Metapherse
Published in

Metapherse

Can NFT’s generate royalties ?

Innovation in “on chain” capability is changing the paradigm when it comes to generating royalties for NFTs on Ethereum

The problem of interoperability

  • For royalties to be paid, interoperability of platforms is crucial
  • All platforms need to recognise the IP of the original work and pass on parts of profit from future sales, irrespective of whichever platform it gets sold from in perpetuity.

Will future innovations in Ethereum solve for NFT royalties?

So what are the use cases solving for this?

  • Unlike other NFTs where the metadata is hosted on a centralised web server, in EulerBeats the metadata of the music and image is contained within the token implementation itself.
  • The data and the script to re-generate the art and music are stored on the Ethereum blockchain.
  • If the EulerBeats website were ever to shut down, you can still use the seed and the script to generate your art and the beat.
  • The aim of this project is to keep all data and logic required to construct the art and music permanently on Ethereum for eternity.
  • It’s a pioneering use case of pushing the boundaries of “on-chain” NFTs storage by placing the “recipe” for art, music, and economics into an Ethereum block.

Can ERC-1155 thereby solve for royalties?

Second use case

  • ZORA NFTs explicitly separates contentURIs and metadataURIs and provides a sha256checksum for each
  • This allows anyone the ability to quickly verify the integrity of the data at any time if a URI has been updated
  • In order to allow the ZORA community to integrate with metadata schema, they provide a media metadata schema repository, that can serve as the source of truth for community supported metadata schemas
  • They are defined as JSON schemas, and generate Types, Parsers, Generators, and Validators that are automatically served through the ZDK

Is there a “Royalty Standard” being created on Ethereum ?

  • This standard allows NFTs that support ERC-721 and ERC-1155 interfaces, to have a standardized way of signalling royalty information
  • More specifically, these contracts can now calculate a royalty amount to provide to the rightful recipient
  • If a marketplace chooses not to implement this EIP, then no funds will be paid for secondary sales
  • It is believed that the NFT marketplace ecosystem will voluntarily implement this royalty payment standard; in a bid to provide ongoing funding for artists/creators
  • NFT buyers will assess the royalty payment as a factor when making NFT purchasing decisions
  • While this standard focuses on NFTs and compatibility with the ERC-721 and ERC-1155 standards, EIP-2981 does not require compatibility with ERC-721 and ERC-1155 standards. Any other contract could integrate with EIP-2981 to return royalty payment information
  • ERC-2981 is, therefore, a universal royalty standard for many asset types

What I still cannot wrap my head around just yet?

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Dev

Work @ Google. Ex Adobe, SAP, LinkedIn, IBM — Musings on growth, art, investing, life and a few other interests