- NFT royalties have seen their steepest decline in two years, shedding light on the revenue outlook for numerous NFT projects.
- The floor price for Bored Ape Yacht Club NFTs has dipped below 30 ETH, indicating changing market trends in the NFT space.
Non-fungible token (NFT) projects have hit a rough patch, witnessing the lowest royalties in two years, according to a recent analysis from Nansen, a leading blockchain analytics firm. This trend presents a potentially worrying financial perspective for several NFT initiatives reliant on these royalties for sustenance and continuous development.
Back in April 2022, NFT creators enjoyed a massive surge in royalties, reaping an estimated $75.7 million in a week. Nansen’s data shows that Yuga Labs, the creator of the famed Bored Ape Yacht Club (BAYC), has raked in around $165.5 million in royalties from its suite of NFT collections.
Declining Revenues Across the NFT Landscape
Other significant contributors to NFT royalties include RTFKT, earning $79.9 million from its collections such as CloneX, and Azuki, bagging $58.2 million from its different collections like Zuki and Beanz. Further, the studio behind Moonbirds, Proof, saw $35 million in revenues, and Doodles generated $27.4 million from various collections. Pudgy Penguins managed to earn a relatively modest $8.3 million across its NFT drops.
However, this declining trend in royalties is of paramount significance, considering they form the bedrock of a studio’s revenue, crucial for ongoing project development.
Historically, OpenSea, the leading NFT marketplace, played a vital role in disbursing royalty payments to NFT projects till 2023. But a shift was observed when rival platform Blur initiated a policy mandating a minimum of 0.5% royalties unless projects chose to opt-out or enforce full percentages.
At present, both OpenSea and Blur are equally competitive in terms of royalties paid through their platforms. However, Blur experiences an uptick in royalties paid when the trading volume experiences a surge.
It is also noteworthy that the top 10 NFT collections have reaped over $345 million in royalties, with Yuga Labs accounting for 44% of the top 10 at $150 million. To date, only 20 NFT projects have earned over $10 million in royalties, indicating a further concentration of wealth in the NFT space.
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