Newsletter #166: New NFT Royalty Models

This week’s featured collector is AtomicMouse

AtomicMouse’s motto is “keeper of key, sweeper of floors and winner of bread.” They have a large and diverse NFT collection. Check it out at is the easiest way to create a gallery of your NFT collection. Show some love for NFTs by sharing this newsletter with your friends!


The results of last week’s poll: When was the last time you purchased an NFT?

The recent poll on NFT purchasing activity offers a nuanced view of current market engagement. On the one hand, 47% of respondents reported buying an NFT within the last 30 days, suggesting active participation. On the other, 33% of respondents last purchased over a year ago, indicating a significant portion of surveyed individuals who have stepped back from active buying. The even distribution of 7% for purchases made 1-3, 4-6, and 7-12 months ago presents an interesting pattern, reflecting steady but subdued activity over the past year.

Exploring new frameworks for NFT royalties

chart describing allowlist, blocklist, and no restrictions on an axis of strict enforcement vs. composability

This week a16zcrypto released a comprehensive analysis exploring the challenges and potential solutions surrounding NFT royalties, a key value proposition for creators in the digital art space. The article delves into the current limitations of enforcing royalties on-chain, primarily due to the difficulty in distinguishing between sales and other types of transfers. It then examines existing solutions like blocklists and allowlists, highlighting their pros and cons in balancing royalty enforcement with NFT composability – the ability for NFTs to interact with various applications and smart contracts.

The piece introduces two novel approaches to NFT royalties that aim to improve upon current models. The first proposes combining an allowlist with a staking mechanism, allowing applications to permissionlessly join the allowlist by staking resources as a commitment to enforce royalties. The second, called “right of reclaim,” introduces a dual ownership model that incentivizes royalty payments without restricting composability. These innovative frameworks aim to address the fundamental tension between strict royalty enforcement and open composability in the NFT ecosystem.

Throughout the discussion, the article emphasizes the importance of finding solutions that preserve composability, maintain digital property rights, and ensure fair compensation for creators. It acknowledges that there is no one-size-fits-all solution and encourages builders and creators to understand the various royalty designs and their tradeoffs to choose the best fit for their unique goals. For a deeper understanding of these complex issues and potential solutions in the evolving NFT landscape, readers are strongly encouraged to explore the full report, which offers valuable insights for creators, collectors, and developers in the NFT space.

7 Reasons Why NFTs Are Not Dead

  1. Market Maturation: The NFT market isn’t dying; it’s maturing. This phase focuses on sustainability and real-world utility, moving beyond the initial hype to more stable, long-term applications.

  2. Evolving Use Cases: NFTs are expanding beyond digital collectibles. They’re finding new applications in various industries, including the creator economy, real estate, and financial markets, demonstrating their versatility and ongoing relevance.

  3. Technological Advancement: The NFT industry has developed revolutionary global property rights systems. This infrastructure enables unique digital ownership and authenticity verification at a fraction of traditional costs, positioning NFTs as a transformative technology.

  4. Ongoing Innovation: Despite market corrections, innovation in the NFT space continues. New platforms in SocialFi and GameFi are emerging, and there’s growing interest from institutional investors as NFTs become more purpose-driven.

  5. Persistent Market Activity: While volumes may be down from peak levels, significant activity remains in the NFT market. For example, Bitcoin-based NFTs have recorded substantial sales volumes, indicating continued interest and engagement.

  6. Industry Transformation: NFTs are reshaping various sectors by providing new ways to represent and trade assets. From digital art to stocks, bonds, and carbon credits, NFTs are creating unprecedented possibilities for ownership and value transfer.

  7. Long-term Potential: Experts view the current state as part of a cycle rather than an endpoint. The foundational technology of NFTs holds immense potential for future applications and broader adoption, suggesting a promising future beyond current market conditions.

While the NFT landscape has evolved from its initial boom, it’s far from obsolete. Instead, NFTs are entering a new phase of development focused on practical applications and sustainable growth, positioning them for long-term relevance in the digital economy.

Read more on why NFTS are not dead at Coindesk and CoinTelegraph.

This week’s poll: What’s the strongest sign NFTs aren’t dead?

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