- The success of platforms like Blur has caused a significant shift in the NFT market.
- Major marketplaces are choosing between customers and creators.
- Leading NFT platforms OpenSea and LooksRare have upgraded their platforms to better align with current market conditions.
- Magic Eden has taken a different approach.
NFTs have experienced remarkable growth this year; however, the sector has yet to bear fruit for creators. Today, marketplaces like Blur, which charge a nominal 0.5% creator fee, account for over half of the trading volume generated by NFT traders.
This, in turn, has prompted leading NFT marketplaces like OpenSea to follow suit and cut rebates to stay relevant. With platforms struggling to compete in current market conditions, they face the difficult choice of prioritizing either customers or creators.
LooksRare recently launched an upgraded version with new features and policies that align with the current competitive landscape. The update comes in response to OpenSea’s recent shift from creator royalties despite their claim of “supporting” creators.
According to the NFT platform, LooksRare V2 is designed to be more “scalable” and “efficient.” It does so by offering the same services as Blur and drastically cutting protocol fees and creator rebates because it is “meta.”
In its official announcement, LooksRare shared:
“LooksRare’s protocol fee is now a fixed 0.5%, all the way down from 2%. Given the current market meta, we’re removing creator rebates for the time being.”
Besides the slashed fees, LooksRare also announced other upgrades, including 50% fewer gas fees than Blur, replacing WETH with ETH, introducing buying and listing NFTs in bulk, and more.
While platforms like LooksRare backtrack from their focus on creator incentives, marketplaces like Magic Eden are doubling down on empowering creators.
After dominating NFT sales on Solana, Magic Eden has quickly gained prominence as a leading NFT marketplace. It has since evolved and expanded to support four networks.
While competitors like OpenSea, Blur, and LooksRare pivot from creator incentives, Magic Eden plans to respect royalties by enforcing them in its Ethereum marketplace, Eth Genesis, launched on Friday, April 7.
Additionally, the platform aims to give its partners a “royalty boost” by sharing revenue from its marketplace fees. Despite current market trends, Magic Eden said it would continue supporting creators with royalties.
It would be interesting to see which approach will ultimately prove successful. Magic Eden reports a daily trading volume of 87,570 SOL, or approximately $1.8 million at press time, compared to LooksRare’s $324 thousand.
On the Flipside
- DappRadar reported that Magic Eden only generated $633 in trading volume at press time.
- Web3 venture capitalist Animoca Brands released a set of NFT licenses that enforces creator royalties.
Why You Should Care
NFTs were initially introduced to benefit both creators and sellers through incentives. Leading marketplaces are backtracking from their focus on creator incentives and moving towards pumping trading volumes, which can damage the ecosystem. However, with the current market conditions, the NFT market is expected to grow to $211 billion by the end of 2035. Time will tell how this new pivot plays out.
Solana introduced a game-changing update:
Solana Dramatically Cuts NFT Minting Costs – Here’s How
Follow how Blur became the top NFT marketplace: