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DYOR 🔬

Yesterday, NFT marketplace OpenSea announced sweeping changes to how it handles “creator fees” (AKA, royalties). Starting August 31, 2023, OpenSea will move to optional royalties. Those collections that used the Operator Filter — which limited sales on non-royalty-enforcing platforms — will see it enforced until February 29, 2024.

The TL;DR is this: OpenSea has capitulated to the market pressure exerted by rival platforms like Blur and join the race to the bottom. Is this surprising? No. Is it unfortunate? Yes.

As OpenSea admits, making Operator Filter work would require buy-in from all players in the ecosystem. But that was never going to happen. It claims that, “creator fees aren’t going away – the ineffective, unilateral enforcement of them is,” but that’s not really how things work.

Making royalties voluntary puts the onus on sellers to honor them… which many won’t, especially in thin-margin trades and the depths of a bear market. It also puts artists in an awkward position. If they can’t rely on royalties they need to charge more for initial sales, or create bigger collections, or simply create more work. Charging more can limit sales. Scaling their output can dilute the value of their catalogs.

Investor Mark Cuban had some fighting words for OpenSea, despite being an investor in the company, and there’s been plenty of added vitriol directed at the marketplace from artists.

But as with most things, one person’s loss is another’s gain, and other platforms that do enforce royalties have seized on the chance to big themselves up.

It’s not just lip service, though, enforcing royalties can be a differentiator, and one that a certain sort of collector might fine attractive when deciding where to direct their capital.

This week I attended a gig for a band that plays 200-plus gigs a year but will probably never play a venue that holds more than 500 people. After the show I bought a record that cost $3 more (or ~10% more) than it would’ve if I bought it elsewhere, but I did it anyway. Because, 1. I know more of the $30 goes to the artist that way, 2. I got to literally put the money in their hand, and 3. I want to help them keep doing what they do.

If you believe artists deserve royalties and you want to support them, vote with your feet… or your transaction approvals. Buy their work on the sorts of platforms that help them build sustainable careers. Or reach out to them directly. But don’t continue to support broken platforms and then bemoan the world that inevitably creates in years to come.

Headliners 🤘

• As part of it’s “Onchain summer” promo for its new base network, Coinbase is offering consumers a $2 NFT of infamous Pixelmon character Kevin, clad in summery finery. Minters get entered into a draw to win a PIxelmon egg and the chance to buy a Kevin physical collectible:

• DeGods co-founder Finn is leaving the project, but claims their “departure has nothing to do with any recent events,” as they began their transition out of the company “in early July.” The pounding DeGods has taken this week can’t have helped, though.

• Magic Eden has created a $1 million fund to “launch the next generation of bluechip NFT projects on [*checks notes*] Polygon.”

• Hardware wallet-maker Ledger has added support for PayPal, allowing users to buy Ether and Bitcoin and other cryptocurrencies via the Ledger Live app:

• Sam Bankman-Fried’s bail was revoked. LOL.

• Meanwhille, the Securities and Exchange Commission (SEC) is expected to give the thumbs-up to Ether-futures ETFs as soon as October:

NGMI ☄️

Grimes’ baby daddy and plumbing fan, Elon Reeve Musk, is planning to remove the option to block accounts on X, the service formerly known as Twitter (and still referred to as such by all reasonably people).

Musk has done some dumb stuff (and lost a lot of money) since taking over the microblogging service/social network, but this one is impressively dumb even by his admittedly low standards.

One of the hardest parts about social media (just ask Mark Elliot Zuckerberg) is moderation. It’s essential but nearly impossible to do well. Twitter doesn’t do it well, so the block feature lets users take matters into their own hands to fend off scammers, harrassers, and other ne’er-do-wellers, and “mute” doesn’t do it well enough, because scammers can still see your content.

Removing the option to block users while letting people buy timeline prominence through paid verification is only going to further enshitificate things. But remember, it’s not too late to block/mute Elon Musk… or to move to Bluesky.

Metaversalism 🔥 

• We’ve been taking to the streets of New York to ask people on the street (🎶 dee da dee da dey 🎶) questions about NFTs. The results have been hilarious and encouraging. Hilarious because most people still have no idea. Encouraging, because that means — despite everything that’s happened over the last two years — we really, truly, genuinely, unambiguously, are still early:

• We like talking to other humans, especially in person, which is why we’re been taking every chance we can to do precisely that with Web3 artists, movers, shakers, and other luminaries. Most recently? Self-taught photographer and master community builder, Dave Krugman (look out for the full interview on our socials soon):

• And last but by no means least, we’ve also been working on a new series called #Hyperculture, that brings you orb-grade ponderings about Web3:

That it. That’s the newsletter.

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Until next time, see you in the metaverse… or on Bluesky! 👀