Yuga Labs takes a stand for creators
In a move that appears to be more symbolic than impactful at the moment, Yuga Labs has made the decision to no longer support marketplaces that do not enforce creator royalties. This announcement, made through a post on X, highlights the company’s commitment to a creator-focused web3 ecosystem. Yuga Labs states that their collections with a royalty filter will only be traded on platforms that enforce creator royalties.
Context of the announcement
This decision comes over a year after Blur managed to capture the majority of NFT trading volume, partly due to their incentivized airdrop and significantly reduced royalty structure. OpenSea, the previous market leader, subsequently lowered its royalty fees in an attempt to compete with Blur.
The decrease in royalty structures, combined with a decline in NFT trading volumes, resulted in a significant drop in Yuga Labs’ revenue last year. In November, Magic Eden announced its partnership with Yuga Labs to launch an Ethereum NFT marketplace that is contractually committed to enforcing creator royalties.
Limited immediate impact
While Yuga Labs’ announcement may one day be considered a turning point, its immediate impact on royalty revenue seems limited. The company is not ending support for its two main trading volume collections, the Bored Ape Yacht Club and the Mutant Ape Yacht Club.
These collections, which generate the majority of royalties for Yuga Labs, are unaffected by this change. Therefore, this update only has a minimal impact on Yuga Labs’ royalty revenue but encourages the team to further develop and prioritize their Otherside collections.
Yuga Labs has released a list of collections that will be exclusively traded on platforms that protect royalty payments. Brands that Yuga Labs intends to protect include several Otherside collections related to the currently developing Metaverse by the company.
