Nansen: NFT royalties hit a two-year low in June 2023, with a week of payouts falling to ~$3.8M from a ~$76M April 2022 peak, as royalty-optional platforms rise
Context & Ripple Effects
Nansen's June reading is the latest step in a collapse Nansen itself has tracked across the cycle: after users spent ~$2.7B worth of ether minting NFTs in H1 2022, payouts to creators fell 98% from a January 2022 peak of $269M to $4.3M by July 2023, with OpenSea and Blur cutting royalty rates amid the bear market.
The mechanism is competitive rather than purely cyclical: royalty-optional marketplaces let traders skip the fee, and even enforcement-first venues are losing volume — Art Blocks, which enforces 5% royalties, saw sales slide from $587M in August 2021 to $6.5M in April 2023. The June figure matters because it shows royalties failing as a revenue line while trading itself continues.
First-order effects
- NFT creators who priced their business models around secondary-market royalties lose most of an income stream now running near ~$3.8M a week, down roughly 95% from the ~$76M weekly peak of April 2022.
Second-order effects
- Marketplaces enforcing royalties, like Art Blocks, face a squeeze between honoring creator fees and matching royalty-optional rivals on effective cost to traders, pushing platforms to compete on volume incentives instead of fee policy.
Third-order effects
- If enforcement keeps failing where liquidity lives, NFT creator economics structurally shift toward upfront mint revenue and optional tipping, with royalties surviving only in curated niches rather than as a market-wide standard.
The trend: NFT marketplaces are dismantling royalties as a default creator payout through fee competition, converting creator compensation from a guaranteed protocol feature into a platform-level choice.