Art Blocks, a compilation of generative art NFTs, helped pioneer a movement to compensate creators with royalties whenever NFTs are sold.
Erick Calderon, who is the co-founder of Art Blocks, attempted to ease the tension surrounding the debate on non-fungible token (NFT) creator royalties. Nonetheless, Calderon expressed his personal view on the issue, stating that royalties are essential as they allow creators to continue their creative work.
Art Blocks is a collection of NFTs that specialize in generative art, which is art that is created automatically based on rules established by its creator. When it comes to NFTs, generative art typically refers to artwork that is generated by computer programs that are designed to exist on blockchains. Art Blocks has recently introduced an NFT marketplace that includes creator royalties as a built-in feature.
Royalties, or the money paid to an NFT’s creator each time it is sold, have been a source of contention between creators and collectors for decades. Some artists view built-in royalties as a key value-add – if not the key value-add – of NFTs, and they have been dismayed when NFT marketplaces and collectors have taken actions that undermine the standard practice of rewarding royalties.
“No matter what the stock market cycles do, no matter what [failed crypto exchange] FTX does and no matter what happens with our regulation in our government, the value proposition of being able to prove ownership of a digital asset cannot and will not change,” said Calderon.
Referring to buzzy concepts such as international marketplaces and creator royalties that are unlocked by NFTs, Calderon stated, “all of those are value-add on top of the basic premise of being able to prove ownership of a digital asset.”
Caderon stated, however, that royalties are beneficial for creators and the broader NFT ecosystem, including collectors and investors who would ordinarily avoid purchasing assets that require artists to receive a share each time they are sold.
There are several evident reasons why an artist would prefer to sell NFTs that pay a royalty.
“The concept of being able to not slog through continuously releasing artwork in order to make a living – but being able to be more thoughtful on your releases and create something that can generate in perpetuity, additional income,” is appealing to creators, said Calderon.
Regarding NFT purchasers who wish to avoid royalties that can reduce their profits, Calderon stated, “there are opportunities that can be missed here if we just look at royalties as a transfer tax.”
Calderon argued that NFTs incentivize artists to create better art and engage in the community, leading to higher profits for both artists and investors. He also believes that the Web3 art marketplace is inherently more artist-friendly.
“A lot of things in the traditional art world happened behind closed doors,” he said. “Here, everything is happening in the open. We are all building in the open. We are all innovating in the open. We are all transacting in the open. We know exactly who’s paying royalties and who’s not paying royalties.”
Calderon acknowledged that his free-market argument for creator royalties applies to those who seek to eliminate them: “It’s like gun laws. You have these rights, and people get very aggressive about their ability to retain that right. When you’re talking to a decentralized ecosystem, actually, you have every right to participate in it however you wish.”
Content Source: coindesk.com