Question:

Which platform is the king of NFT royalties?

Compare royalty payouts of 3 NFT marketplaces. Then choose at least 2 additional metrics to evaluate the impact of royalties on NFT market activity.

Overview of analysis:

This investigation contains the following parts:

• The Royalty fee comparison in general
• Time base analysis of Royalty fee
• The most paid royalty fee on NFT collections

About Royalty fee

Artists and creators of digital works should be able to turn their creativity in creating their unique work into a share in all future sales and benefit from it. Such a possibility is called the share of creativity or, in better words, the royalty. In fact, NFT provides the creator of the work with future benefits by proving the true ownership of the digital content. In this way, a portion under the title of royalties from all subsequent sales after the initial transaction goes to the creator of the work.

A royalty payment is a payment made by one party to another that owns a particular asset, for the right to ongoing use of that asset.

Now we want to estimate the Royalty fee of various marketplaces on Ethereum universe and find out the pattern and trend of this fee on them.

Methodology:

The data provided by Flipside has been used to handle this analysis.

• The Royalty fee calculation is done by:

  sum(CREATOR_FEE_USD) as Royalty_fee from ethereum.core.ez_nft_sales

• Useful metrics have been adopted like:

  • Percentage of royalty fee on total volume
  • Share of platform fee
  • Average royalty fee per sale
  • Cumulative royalty fee over time
  • Top NFT collections with most paid royalty fee

Part 1: Platform comparison

Findings:

The outcomes of this part have been summarized as below:

• The ==OpenSea== is the dominated marketplace in term of royalty fee payment.
• The second rank belongs to ==LooksRare== in both volume of sale and royalty fee.
• The ==Sudoswap==, ==Larva labs== and ==NFTX== have zero royalty fee payment on Ethereum.
• The ==Rarible== has the highest percentage of Royalty fee by ==6.15 % of volume==.
• The highest percentage of payment for ==platform fee== belongs to ==NFTX==.
• First week of February 2022== was the highest paid week for Royalty fee with over 67 million USD payment only on OpenSea.
• The ==Looksrare== marketplace has the highest weekly average royalty fee on the last week of August 2022 with over 480 USD.

Part 2: NFT collections comparison

Findings:

Now, its time to dive deep on NFT collections that attract most of the royalty fee on Ethereum.

• The Otherside== NFT collection is the leader of royalty fee payment with over 48 million USD payment.
• The ==Azuki== and ==Boredapeyachtclub== are in the next ranks of most paid royalty fee.
• The ==average royalty fee== payment dominated by ==Boredapeyachtclub== with over ==6100 USD== and the main reason of that, this collection is very expensive.
• The ==Rtfkt== has the highest percentage of royalty fee with ==near 10%== as can be seen.
• Among these top collections, the ==opensea== collection has the highest count of buyers but has the lowest average royalty fee payment.

Conclusion:

• The OpenSea marketplace is the king of Royalty fee.
• The Looksrare has the highest average royalty fee payment.
• The Otherside is the leader of royalty fee among NFT collections.

Useful links:

• Reference 1
• Reference 2
• Medium article

Author:

Credited by MZG

Discord handle: m.zamani#0361

Twitter handle: @GargariZamani