The well-known Solana NFT brand is the most recent collection to make the conversion to a royalty-free model.
The NFT collection DeGods is the latest to start charging no royalties. The group called the move its “next experiment.” It said that the move was the best choice for its business and that it protects the collection from possible future lawsuits over artist royalties.
Non-fungible tokens, also called NFTs, are cryptographically unique tokens that are linked to digital and physical content, memberships, or proof of ownership.
Before NFTs, the standard in the industry was to pay artists royalties based on a percentage of sales on the secondary market. But it was hard to keep track of these follow-up sales, which is a problem that NFTs are well-equipped to solve.
But artists and NFT marketplaces have shown in recent actions that they want to move away from this model. The top collection of Ethereum NFTs, CryptoPunks, also has 0% royalties, and other well-known creators are giving away all commercial rights to their work.
Sunday, DeGods wrote on the collection’s Twitter account about the change.
“We still believe that royalties are an incredible use case of NFTs,” DeGods tweeted on Sunday. “We will continue to support creators that want to find solutions to enforce royalties.”
DeGods are a group of 10,000 Solana NFTs that will come out in October 2021. People who own DeGods or DeadGods NFTs can stake them and get DUST utility tokens in return. The DUST utility token from Dust Labs was first made available as a reward for people who owned DeGods.
According to data from CoinGecko, the DUST utility token is now worth $1.27, which is 4.7% less than when DeGods announced it.
DeGods says that the t00bs and y00ts NFT collections will be affected by the new policy of paying no royalties.
“If royalties go away… I think the space will be more open to redefining what ‘rug’ means,” tweeted DeGods pseudonymous creator Frank, referring to accusations that DeGods was a “rug pull” or scam. “For 5 months people labeled us a dead project & a rug.”
In August, Solana NFT marketplace Solanart tweeted that it was “re-introducing” custom fees for buyers and sellers on the marketplace. The tweet said, “This time, YOU choose what’s fair.”
Solanart took note of DeGods’ move to 0% fees today and defended the collection against claims that it is going to zero.
“We heard DeGods are going to ZERO? Well sell me all you want for 33.33 SOL then fuck off (& use 0% fees),” they tweeted.
On Twitter, Dylan Shub, the founder of Crown Capital DAO, questioned what the DeGods said.
“Considering you made a big spiel when the royalty debate started about how you will be enforce royalties or deny service,” he tweeted, “I would genuinely like to hear a bit more about how you arrived at this conclusion.”
“This decision is not good for the space,” @hyxttcrypto initially wrote. “In the short term teams have mint funds, but long term royalties are the main incentive for teams to keep active, motivated, be able to to grow and employ people in the space. DeGods are where they are because of royalties.”
“It’s weird that @frankdegods is needing to defend a move to 0% royalties,” tweeted @Punk9059, the pseudonymous research director for the Proof Collective. “It’s a SOL transfer from him to everyone else. And everyone else is mad.”
“I am for royalties. But he just got millions off y00ts mint & raised VC funding,” they continued. “Seems very off to suggest this shows he doesn’t care.”
“They are just frontrunning the market,” wrote DeGods fan @punk828_. “Everyone is already looking for zero royalties. This just forces teams to build outside revenue streams and actual businesses and not just be a jpeg project with no real world use case.”
Even @hyxttcrypto changed his mind after a few hours.