OpenSea Embraces ERC-721C Token Standard to Safeguard NFT Royalties

OpenSea, a prominent NFT marketplace, has adopted the ERC-721C token standard, which establishes enforceable on-chain royalties for NFT creators. Aiming to tackle the issue of NFT wash trading, this standard enables "programmable earnings," ensuring creators are fairly compensated when their NFTs are resold in secondary markets.

OpenSea Implements ERC-721C Token Standard to Protect NFT Royalties

London, United Kingdom - March 14, 2023 - OpenSea, the leading non-fungible token (NFT) marketplace, has announced the integration of the ERC-721C token standard, a groundbreaking advancement designed to address the long-standing challenge of enforcing on-chain royalties for NFT creators.

Prior to the introduction of ERC-721C, NFT creators faced significant hurdles in securing their rightful earnings from secondary market transactions of their creations. This was primarily due to a loophole in the previous ERC-721 token standard that allowed traders to avoid paying royalties by transferring NFTs through platforms that did not honor creators' royalty requirements.

Recognizing the urgent need to address this issue, OpenSea has partnered with Limit Break, the blockchain gaming firm responsible for developing the ERC-721C standard. This innovative solution effectively closes the loophole and ensures that creators receive their rightful earnings, regardless of where their NFTs are traded.

The ERC-721C token standard introduces the concept of "programmable earnings," enabling creators to set and enforce earnings percentages and recipient addresses directly on-chain. This empowers creators with greater control over their earnings and eliminates the risk of losing out on royalties due to wash trading or other fraudulent activities.

Limit Break's Medium blog post succinctly explains the transformative nature of the ERC-721C standard: "In the long-run, this allowed for the incentivization of zero-fee, royalty-optional trading with airdrops, effectively turning tokens intended to be non-fungible into proxies for fungible tokens."

To ensure widespread adoption and interoperability, the ERC-721C standard is backward-compatible with the existing ERC-721 standard. This allows for seamless integration without disrupting existing NFT ecosystems.

OpenSea's recent implementation of ERC-721C is a significant milestone for the NFT industry. It empowers creators to set and enforce royalties, fostering a sustainable and equitable environment where their creative efforts are duly compensated.

Creators using OpenSea Studio can now effortlessly implement the ERC-721C standard. Custom smart contract creators are also advised to upgrade their contracts to be compatible with ERC-721C or ERC-1155-C to ensure future compatibility.

As a result of this integration, OpenSea now supports exclusive sales for creators who enforce earnings using the ERC-721C standard. This provides creators with an exclusive platform to sell their works while ensuring their royalties are protected.

The industry-wide adoption of the ERC-721C token standard is a testament to the growing recognition of the importance of protecting creators' rights in the digital art market. OpenSea's leadership in implementing this standard signifies its commitment to fostering a fair and transparent ecosystem for both creators and collectors.