The Future of Royalties: Permanent, Programmable, and Owned

Royalties are not enforced. The original ERC-721 standard lacks a native mechanism for royalty payments, making them an optional feature dependent on marketplace goodwill. This created a social contract that platforms like Blur and SudoSwap broke to gain market share by offering zero-fee trading.

Programmability is the only solution. The technical fix is on-chain enforcement via standards like EIP-2981 for fungible fees and EIP-5218 for transfer hooks. These standards allow creators to embed royalty logic directly into the NFT smart contract, making payments non-negotiable and automatic upon any transfer.

Permanent ownership of the fee stream. Protocols like Manifold's Royalty Registry and 0xSplits create permanent, ownable financial assets from royalty streams. Creators can tokenize, sell, or use future royalties as collateral, transforming a voluntary payment into a programmable financial primitive.

Evidence: After Blur's zero-royalty policy, creator earnings on major collections fell over 50%. In response, platforms like OpenSea now enforce royalties only for collections using on-chain enforcement tools, proving the market forces the technical hand.

Royalties become permanent assets. On-chain royalties are no longer just a fee stream; they are a discrete, ownable financial primitive. Protocols like Manifold's Royalty Registry and standards like EIP-2981 create a persistent, non-custodial claim on future cash flows, decoupling value from the underlying asset's ownership.

Programmability enables financialization. This asset class is natively programmable, enabling automated distribution via Safe{Wallet}, collateralization in DeFi lending markets like Aave, and bundling into tradable indices. The securitization of cash flows transforms illiquid future revenue into present-day capital.

Sovereignty shifts to creators. The traditional intermediary model is obsolete. Smart contracts enforce automatic, immutable payouts, removing reliance on centralized platforms. This creates a direct, verifiable economic relationship between creator and collector, governed by code, not policy.

Evidence: The $100M+ in secondary sales royalties processed by Manifold's registry demonstrates the latent demand for this infrastructure, while the integration of royalty standards into major marketplaces like OpenSea and Blur validates the economic model.

Optional royalties are dead. Marketplaces like Blur and OpenSea's Seaport 1.5 made royalties a suggestion, not a rule, leading to a 95%+ drop in creator fees on many collections.

Enforcement is now on-chain. Protocols like Manifold's Royalty Registry and 0xSplits create programmable payment rails that lock fees into the asset's transfer logic, making evasion impossible.

The new standard is EIP-2981. This NFT royalty standard provides a universal, on-chain lookup for fee recipients, allowing any marketplace or wallet to discover and respect the creator's terms automatically.

Evidence: Collections using EIP-2981 with on-chain enforcement on Manifold have maintained 100% royalty collection, while those relying on marketplace policy have seen near-zero fees.

Royalties are a protocol primitive. They are not a marketplace feature. This shift moves enforcement from application-layer policy to a settlement-layer guarantee, making royalties resistant to centralized delistings like those seen on Blur and OpenSea.

Programmability enables complex logic. Royalties can now be split automatically, vest over time, or fund community treasuries. Standards like EIP-2981 and EIP-5218 provide the on-chain hooks for this logic to execute during any transfer.

Creator-owned logic is the endgame. Projects like Manifold's Royalty Registry and 0xSplits demonstrate that the royalty contract itself is an asset. Creators deploy and own this code, making their revenue stream portable and permanent across any future marketplace.

Evidence: The Manifold Royalty Registry secures over 1.5% of all Ethereum NFT volume, proving demand for a canonical, on-chain source of truth that bypasses platform-specific policies.

Royalties become permanent assets. On-chain royalties are not just a fee; they are a persistent, ownable cash flow stream. This transforms a contractual obligation into a financial primitive that can be valued, traded, or used as collateral.

Programmability enables financialization. Protocols like Manifold's Royalty Registry and EIP-2981 standardize royalty logic, allowing for complex splits, vesting schedules, and automated distributions. This programmability is the prerequisite for secondary markets.

Creators own their revenue streams. Unlike Web2 platforms that control payout terms, on-chain royalties are creator-owned infrastructure. This shifts power from intermediaries to the asset originator, enabling direct monetization strategies.

Evidence: Platforms like Sound.xyz and Zora have pioneered immutable, on-chain royalties, demonstrating that enforceable creator fees are viable and demanded by artists when the infrastructure is transparent and user-owned.