Bored Ape's 30 ETH Floor Price Drop Impacts Ethereum NFT Royalties

Bored Ape's 30 ETH Floor Price Drop Impacts Ethereum NFT Royalties

In a startling revelation, blockchain analytics firm Nansen has reported that royalties earned by non-fungible token (NFT) projects have hit rock bottom, marking a two-year low. This news comes amidst recent turbulence in the NFT market, including a drop in the floor price of Bored Ape Yacht Club (BAYC) NFTs and the controversy surrounding the launch of the Azuki Elementals collection.

The once-thriving NFT ecosystem experienced its peak in April 2022, with creators raking in a staggering $75.7 million in just one week. However, Nansen's data paints a starkly different picture today. Yuga Labs, the mastermind behind BAYC, has seen their total royalties dwindle to a still-impressive $165.5 million across their portfolio of NFT collections.

Another notable player, RTFKT, has earned a substantial $79.9 million in royalties from their various collections, including the popular CloneX. Azuki, known for their zuki, Beanz, Elemental Beansa, and Elementals collections, has amassed $58.2 million in royalties.

Not to be left behind, Proof, the creative force behind Moonbirds, soared to $35 million in revenues. Doodles, the artistic endeavor featuring Doodles, Space Doodles, Genesis Box, and Dooplicato collections, made an impressive $27.4 million. Pudgy Penguins, with their adorable Pudgy Penguins, Lil Pudgys, and Pudgy Rods drops, brought in a respectable $8.3 million in revenue.

Nansen emphasizes the significance of NFT royalties as a crucial indicator of a studio's financial foundation for ongoing development, as they play a vital role in generating revenue. The ability to sustain and nurture NFT projects heavily relies on the income derived from royalties.

Historically, NFT marketplace OpenSea held the lion's share of responsibility for distributing royalty payments to NFT projects. However, a major shift occurred in 2023 when rival marketplace Blur introduced a groundbreaking policy. Unless projects explicitly opted out or enforced specific percentages, Blur mandated a minimum of 0.5% royalties. This policy change disrupted the status quo and reshaped the landscape of royalty payments.

OpenSea, in response, gave buyers the freedom to choose whether to pay royalties unless projects had opted out or imposed their own percentage requirements. This move leveled the playing field between OpenSea and Blur, with Blur gaining an edge in terms of royalty payments during periods of high trading volume.

The future of NFT royalties remains uncertain, as the market grapples with various challenges. However, creators and collectors alike will be watching closely to see how this landscape evolves and if it regains the momentum witnessed in the past.

Total royalties paid to NFT projects. Source: Nansen NFT trends dashboard

Nansen's findings uncover a noteworthy insight into the world of NFTs. The top 10 NFT collections have collectively amassed a staggering sum of more than $345 million in royalties. A striking revelation from the data is that Yuga Labs alone accounts for a substantial 44% of this amount, with their royalties reaching an impressive $150 million. Equally intriguing is the fact that a mere 20 NFT projects have managed to surpass the $10 million mark in terms of earnings from royalties up until now.

also read: Nike & Fortnite Forge Web3 Partnership, Unveiling Sneaker NFTs

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