Yuga Labs, the creative force behind the renowned Bored Ape Yacht Club (BAYC), has unveiled its plan to diminish its support for OpenSea in response to the imminent removal of the on-chain royalty enforcement tool, Operator Filter.
Introduced in November 2022, the Operator Filter empowered creators by allowing them to restrict secondary nonfungible token (NFT) sales to marketplaces that upheld creator royalties, effectively filtering out platforms like Blur that did not adhere to these royalty standards.
However, on August 17, OpenSea disclosed its intention to “sunset” the Operator Filter tool by the end of August. OpenSea cited several reasons for this decision, including limited adoption within the ecosystem, instances of platforms bypassing the tool, and resistance from creators.
In response to this development, Daniel Alegre, CEO of Yuga Labs, released a statement via X (formerly known as Twitter) on the following day. Alegre outlined Yuga Labs’ strategy to gradually reduce its reliance on OpenSea’s Seaport marketplace smart contract, stating:
“Yuga Labs will commence the process of phasing out support for OpenSea’s SeaPort, encompassing all upgradable contracts and any new collections. Our goal is to complete this transition by February 2024, aligning with OpenSea’s approach.”
On @opensea's decision to sunset their Operator Filter. pic.twitter.com/ahc155WWkX
— Yuga Labs (@yugalabs) August 18, 2023
Alegre emphasized Yuga Labs’ unwavering commitment to preserving creator royalties to ensure that artists receive equitable compensation for their creative work.
The announcement received a positive response from members of the Bored Ape Yacht Club community. Additionally, prominent content creators and founders of NFT projects, including EllioTrades and Alex Becker, commended Yuga Labs’ decision.
Dotta, CEO, and co-founder of the Forgotten Runes Wizards Cult NFT project, expressed support for Yuga Labs’ move, highlighting the collective influence creators possess in steering toward platforms that uphold royalty payments. Luca Netz, CEO of the Pudgy Penguins NFT project, hinted at following Yuga Labs’ lead, describing it as a “wise move.”
Yuga is banning OpenSea in light of their choice to stop enforcing creator royalties
You love to see it
Like I mentioned yesterday, OpenSea taught us how to filter exchanges with bad behavior by giving us the OperatorFilter registry
Those of us that implemented it, now plan on…
— dotta (@dotta) August 18, 2023
The issue of creator royalties has generated intense debate within the NFT community over the past year. While enforcing creator royalties was a common practice during the initial stages of the NFT boom in 2021, platforms like Blur disrupted the market in October 2022 by offering zero trading fees and an optional creator royalty payment model. This shift led to reduced trading fees and royalty percentages across various marketplaces as they competed for users.
Presently, the NFT community finds itself divided between those favoring the cost-effective NFT trading model, exemplified by platforms like Blur, and those advocating for the continued significance of compensating creators through royalties.
Disclaimer: This article is intended solely for informational purposes and should not be considered as financial or investment advice. The information provided is subject to change, and readers are encouraged to conduct their research and verify details before making any decisions.
