Yuga Labs and LSLTTT Holdings Restrict NFT Trading on OpenSea and Blur
The creators of the Bored Ape Yacht Club (BAYC) NFT collection, Yuga Labs, and Pudgy Penguins creator LSLTTT Holdings, have decided to block certain NFTs from being traded on popular marketplaces like OpenSea and Blur. Instead, these collections will only be available on SudoSwap V2 and X2Y2 decentralized marketplaces.
Mara Collection and Royalties
The Mara collection, created by Yuga Labs, features 10,000 NFTs of creatures called Maras in the Otherside metaverse. These NFTs can breed and evolve but primarily serve as companions to Kodas, who guard the Otherside.
In NFT trading, royalties are paid to the creator each time their piece is resold. This provides artists like Yuga Labs and LSLTTT Holdings with a passive income stream. By buying an NFT with royalties, you directly support the creator.
Declining Royalty Payments
OpenSea and Blur have been reducing royalty payments due to declining activity in the NFT market. The average royalty payment dropped from 2.5% in 2022 to 0.6% as of July 2023. Blur specifically reduced creator fees to a minimum of 0.5%. OpenSea also changed its creator policy to require an on-chain enforcement method for receiving royalties.
OpenSea retired its OpenSea Operator Filter tool after it didn’t receive enough community support. The tool allowed creators to block marketplaces that didn’t enforce creator royalties.
Hot Take: Balancing Royalty Fees and Market Activity
Yuga Labs and LSLTTT Holdings’ decision to restrict NFT trading on OpenSea and Blur highlights the ongoing challenge of balancing royalty fees and market activity. While royalties provide creators with passive income, reducing fees aims to stimulate trading and increase activity in the NFT space. As the NFT market continues to evolve, finding the right balance between supporting creators and encouraging market participation remains crucial.
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