The Open Metaverse Alliance (OMA3), a collaborative group led by executives from blockchain company Animoca Brands and metaverse platform Upland, has formed a new working group with the goal of protecting NFT artists’ earnings on digital marketplaces. This alliance includes major industry players in blockchain technology, NFTs (non-fungible tokens), and the metaverse such as Yuga Labs, creators of the Bored Ape Yacht Club NFT collection, leading NFT marketplace Magic Eden, blockchain-based metaverse platforms Alien Worlds, The Sandbox, and Decentraland.
Together, these companies aim to address ongoing challenges plaguing the emerging NFT and broader metaverse spaces by establishing international standards that NFT marketplaces must follow to ensure creator royalties are upheld. A core objective of OMA3 is to create a set of standards that alliance members commit to in order to maintain the tradition of paying royalties to original artists, typically ranging from 2.5% to 10% of secondary sales. However, some NFT marketplaces have discontinued enforcing royalty payments in order to attract users by offering gamified financial incentives, as seen by Blur overtaking OpenSea as the largest NFT platform by trading volume after removing royalty enforcement.
Surprisingly, OpenSea also announced in August 2022 that it would cease enforcing creator fees, prompting prominent NFT brands such as Yuga Labs to stop selling their virtual assets on OpenSea in protest. Yuga Labs’ Bored Ape-themed collectibles alone had generated over $9 billion in trading volume on OpenSea, making their departure a huge loss for the platform. OMA3 firmly believes moves to discontinue royalty enforcement not only threaten the sustainability of the NFT ecosystem but also undermine core principles of metaverse development. NFTs are expected to play a pivotal role in shaping a more connected virtual world where assets can freely move between platforms, redefining digital ownership.
According to Animoca Brands CEO Rob Yung, a key issue is that many NFT buyers are focused on short-term financial gains rather than prioritizing the long-term well-being of the ecosystem. A core part of OMA3’s mission is to protect creator royalty payments, viewing the metaverse as a utopian virtual world that requires active preservation. By taking on these ongoing challenges, OMA3 demonstrates its commitment to maintaining the credibility and growth of the NFT landscape while also advancing the broader vision for an open, decentralized metaverse.
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