Do you want to know how to set royalties on OpenSea?
Perhaps you’ve started creating your first NFT but you can’t seem to figure out where you should set the creator royalty?
Don’t worry, because it’s actually quite simple if you know where to look and understand how OpenSea has structured creator royalties.
In this article, you’ll learn how to set royalties on OpenSea as well as how high they should be.
It’s time to learn!
Key Points (tl;dr)
- NFT royalties are like a commission that the original creator of the NFT receives on every trade that happens on the secondary market. This commission, defined as a percentage, is automatically enforced by the underlying smart contract.
- When creating your own NFT collection, it is important to consider various factors when setting the royalty percentage. Set it too high and it might come across and greedy and potentially stifle trading activity. Set it too low and you might not generate enough royalties to re-invest into the project.
- Setting the creator royalty on OpenSea is very easy. You must do so on the collection level, within the “Creator Earnings” section. OpenSea let’s you set a royalty between 0% and 10%.
For a step-by-step guide on how to set royalties on OpenSea, PLEASE SCROLL FURTHER DOWN THE ARTICLE.
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Solved: How to Set Royalties on OpenSea in 3 Easy Steps
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Here’s the answer. Great article by @ChrisHeidorn right here: https://tokenizedhq.com/how-to-set-royalties-on-opensea/
How Do NFT Royalties Work?
NFT creators can set a fixed royalty percentage on their collections. That means that every time an NFT from their collection is sold to a new owner, the underlying smart contract will automatically deduct the creator royalty from the sales proceeds and transfer them to the creator’s wallet. This allows for potentially perpetual residual income for the original creator.
Creator royalties are one of the biggest game-changers that NFTs have introduced to the art world.
You see, previously in the traditional art world, the original artist only benefited from primary sales of their work.
As an artist became more famous, they would be able to sell their new work for higher prices, however, they wouldn’t get a single dime from the secondary sales.
This is particularly unfair when masterpieces are being auctioned off for millions of dollars.
But with NFTs the game has changed completely.
Artists and creators are now able to embed a structural creator royalty into their work.
They do not only earn money on the primary sale, but also on every secondary sale.
The more their NFTs are traded, the more residual income the creator will receive.
And that’s exactly why so many people are trying to learn how to set royalties on OpenSea.
We also have a guide that explains exactly how to see royalties on OpenSea because it’s not always obvious where they are displayed.
How High Should My NFT Royalty Be?
OpenSea allows creators to set a creator royalty between 0% and 10%. There is some debate about what the right percentage is. High royalties can come across as greedy and potentially stifle trading activity. Low royalties may not yield sufficient royalties to re-invest into a project. The vast majority of projects set their royalty between 5% and 10%.
Even if you already know how to set royalties on OpenSea, you might be wondering what the right percentage is.
From a technical point of view, a custom NFT smart contract will allow you to set whatever percentage you want.
However, OpenSea has limited this option and allows creators to set a royalty of anywhere between 0% and 10%.
There is some debate around what the best solution is here and not everyone necessarily agrees.
Let’s have a quick look at the competing arguments.
Arguments for a higher royalty
- You are the original creator
- Proceed allow you to invest into more value
- Investors are more like to hold longer
Arguments for lower royalty
- Royalties are a cost factor and can stifle trading activity
- Increased trading may compensate a lower percentage
- It looks less greedy
There’s really no perfect answer to the question.
Some of the most successful collections have low royalties (e.g. Bored Ape Yacht Club) and others have high royalties (e.g. VeeFriends).
In the end, it all depends on your preferences.
If you’re still new to the NFT game and are planning on launching your own project soon, you can get some additional help from our guide on how to price your NFT.
How to Set Royalties on OpenSea
You can set the royalty percentage for your NFTs by editing the collection they belong to. Within the “Creator Earnings” section you can set the creator fees you like to receive on secondary sales. If your NFT doesn’t belong to a collection yet, you can create a new one and add it afterward.
One of the biggest misunderstandings amongst people who are new to NFTs is that they think they set their creator royalty on a single NFT.
That’s one of the main reasons why they end up searching for advice on how to set royalties on OpenSea.
It’s important to understand that an NFT doesn’t exist in isolation.
Every NFT needs to be linked to a smart contract and that is where certain things, like royalties, are set.
Within the OpenSea system, this means that you can’t actually set a royalty on a specific NFT.
Instead, you need to set the creator royalty on the collection level.
You don’t necessarily need to create the collection first since you can add NFTs to it afterward.
However, if you want to learn how to set royalties on OpenSea, you’ll have to create a collection first.
When you create a collection, you can set the creator fee within the section called “Creator Earnings”.
Once you’ve created the collection and added NFTs to it, OpenSea’s smart contract will take care of the rest.
It’s that simple.
Conclusion
Creator royalties are one of the biggest attractions of NFTs and that’s why so many creators are getting into them.
Unfortunately, the way OpenSea has structured them isn’t very intuitive and that’s why so many are trying to figure out how to set royalties on OpenSea.
Luckily it’s incredibly easy as long as you know where to look.
Just remember, royalties are set on the collection level, not the token level.
Here at Tokenized, we want to help you learn as much as possible about the coming NFT revolution. We help you navigate this fascinating new world of non-fungible tokens and show you how you can integrate tokenization into your own business.
