In the face of rising competition from upstart rival Blur, leading NFT marketplace OpenSea announced today that it will temporarily eliminate its 2.5% fee on sales, as well as cut down creator royalty protections as it attempts to weather a rapidly changing market.
Along with axing its own marketplace fee on trades for a “limited time,” effectively cutting off its primary source of revenue, OpenSea tweeted that it will only enforce a 0.5% mandatory creator royalty fee on NFT trades for projects that don’t have an on-chain enforcement method, although sellers can choose to pay a larger percentage. A creator royalty is typically a 5% to 10% cut of the sale price, paid out to the NFT creator. It’s how NFT projects generate ongoing revenue following the initial sale of tokens.
OpenSea’s move comes following a big week for Blur, the upstart marketplace that launched last October. Blur airdropped its BLUR token to more than 100,000 NFT traders on Tuesday, and then Wednesday advised NFT project creators to block OpenSea trades. Blur does not charge a marketplace fee for traders.