An NFT royalty is a cut of every resale that's meant to go back to the creator, usually somewhere between 2.5% and 10%. It's real money when it's paid. But in most cases nothing in the token forces anyone to pay it. The marketplace decides. And since 2023 most of the big ones have decided it's optional.

How royalties are supposed to work

You mint a piece and set a royalty, say 5%. The piece sells for 1 ETH, then resells for 3 ETH a year later. On a marketplace that honours the setting, 0.15 ETH lands in your wallet without you lifting a finger. That was the pitch that brought a lot of artists on-chain in 2021.

2.5%Low end of the usual NFT royalty range
0.15 ETHWhat a 5% royalty pays on a 3 ETH resale
Aug 2023When OpenSea made creator fees optional

The catch is where that 5% lives. The common standard, ERC-2981, lets a contract announce a royalty. It doesn't make anyone pay it. Payment happens only if the marketplace's own code chooses to send it.

Three ways an NFT can resell, and whether the creator gets paid NFT resells 5% royalty set Marketplace enforces it e.g. an ERC-721C collection Marketplace makes it optional buyer or seller chooses Wallet-to-wallet deal no marketplace involved Creator paid Maybe Nothing
Same NFT, same 5% setting. Whether you get paid depends on the route the resale takes.

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Why the big marketplaces stopped enforcing them

Traders hate fees. When Magic Eden made royalties optional on Solana in October 2022, volume followed the cheaper option, and the rest of the market felt the pull. OpenSea held out with a blocklist tool, then gave up in August 2023: creator fees went optional for new collections that month and for existing ones from February 2024.

Wallet-to-wallet sales were never covered at all. Two people can agree a price over Telegram, swap the NFT and the ETH directly, and the creator sees nothing.

Some newer contracts fight back. ERC-721C, from Limit Break, lets a creator block transfers through marketplaces that won't pay. It works, but it only covers collections minted with it, and it narrows where the piece can trade.

Liquid works the other way. Every secondary sale on the platform pays the creator a 10% royalty by default, and a further 5% is added back into NFT liquidity across the platform.

What this means if you're a creator

On most marketplaces, price your mint as if royalties will never arrive. If they do, good, that's a bonus. There, the primary sale is the only money you can count on, which is why edition size and mint price matter more than the royalty number. Liquid is different. By default the creator gets 40% of each mint, 50% is locked inside the NFTs as liquidity backing in FUSD, and the platform takes the remaining 10%, half of which is spread across existing NFTs. You can lower your own 40% to lock more into each NFT. Every secondary sale on the platform then pays the creator the default 10%, so on Liquid royalties from platform sales are paid every time, and you can lower that 10% too and send part of it into your collection or to charity. Our guide to minting your first collection walks through that.

What to check before you pick a marketplace

Read the marketplace's current creator-fee policy yourself, on the day you list. These rules have changed more than once in three years. If you're splitting income with collaborators, check it supports automatic splits, which matters most for music, as our music NFT guide explains.

And if royalties are central to your plan, ask one question before you mint: does this contract enforce them, or only announce them?