Only ten NFT issuers account for 27% of total creative royalties, however, this wealth concentration poses issues with centralization and opportunity.
According to a brand-new study published today by Mike Novogratz’s Galaxy Digital, royalties from secondary sales on platforms like OpenSea have brought in $1.8 billion for Ethereum NFT producers.
Sal Qadir and Gabe Parker, researchers at Galaxy Digital, revealed that the average royalty rates for NFT artists on OpenSea—the top overall marketplace by trade volume—have increased by a factor of two over the past year, from a 3% share of sales to 6%.
Additionally, the researchers found that royalties were concentrated among just 10 companies, which implies that the NFT economy may be more centralized than previously imagined.
Nearly half a billion dollars worth of royalties, or 27% of total Ethereum NFT royalties, were received by the top 10. The research, which is based on information from Flipside Crypto, claims that 482 NFT collections combined brought in 80% of market royalties.
NFTs—individual blockchain tokens that represent ownership—are frequently “minted” or sold for the first time on a third-party website made by the NFT developers, or through a specific launchpad made accessible from some markets. NFTs may then be sold again after the mint on websites like OpenSea, Magic Eden, LooksRare, and others.
The $4 billion business has reaped well over $147 million from royalties alone and has shifted its attention to creating blockchain games. Given that Yuga’s enormous Otherside metaverse land mint earlier this year generated $561 million in total sales in only 24 hours, this is not at all surprising.
Data from Dune Analytics and the Galaxy report, which claims that OpenSea accounts for over 80% of all Ethereum NFT marketplace volume, show that OpenSea continues to account for the majority of all NFT resales despite the fact that new NFT markets are still constantly emerging.
Creators can select the portion of royalties they want to receive from secondary sales when minting NFT projects through OpenSea. The royalties from those sales have brought in a total of $76.7 million for those creators. When taken as a whole, that places you third on Galaxy’s ranking.
The teams behind The Sandbox, Doodles, and Gary Vaynerchuk’s VeeFriends are among the other famous NFT developers on the list, along with Proof (Moonbirds and Proof Collective), Chiru Labs (Azuki), and Chiru.
Nike was the highest earner with $91.6 million in earnings, according to a second data set that solely included historical brands. There are other non-Nike-branded NFT products listed there from RTFKT, a digital studio that Nike bought in 2021. Dolce & Gabbana, Gucci, and Adidas are among the names on the list.
