Web2 Train Continues to Roll In and OpenSea Talks Royalties
GM. It's Lootbox again bringing you loot of gems like a blizzard brings snow. Today we have on the menu
- Square Enix's foray into web3
- OpenSea's decision on NFT royalties
Square Enix makes a move on Ethereum
Gaming giant Square Enix (Final Fantasy), has announced its first foray into Ethereum with Symbiogenesis. This is the first game that will make use of NFTs from Square Enix.
Here's what we know
- Symbiogenesis is a “digital collectible art experience” utilizing NFT artwork, that is not only compatible with the game but can be used as a PFP on any number of the now web3-friendly social media sites.
- It is planned to be a web3-based platform with interactive elements. Players can use their NFT as they play through missions centered around monopolies and resources.
This is not the first time Square Enix has dipped its toe in the web3 pool. In 2020 they led a $2M investment round into the popular metaverse "The Sandbox". In fact, they seem to be showing strong belief in web3 with their activities. Here are some of the things they have done recently.
- They sold off a number of franchises (including Tomb Raider) and studios for $300 million.
- Announced plans to bring the popular franchise "Dungeon Siege" into the well-known metaverse "The Sandbox".
- Announced plans earlier this year to launch NFTs tied to Final Fantasy figurines that would come in 2 editions.
The cat appears to be coming out of the bag as more and more Web2 gaming companies make moves into Web3. It should be no shock that many beloved franchises of our past may have a resurgence in Web3. Square Enix coupling this same play while also releasing a brand new title on Ethereum is enough to get my last case of Code Red Mt. Dew out of the closet.
Want more on this? Check it out here.
OpenSea makes a decision on NFT royalties
Once again, creator royalties are the hot topic of the week. OpenSea posted a tweet thread (and accompanying article), explaining their position on the royalty issue. If this is your first time hearing about the royalty issue, here is a quick rundown.
- There has been controversy over creator royalties on NFTs over the past few months. In the red corner is the camp that believes royalties should be optional in marketplaces (beneficial for traders). In the blue corner is the camp that believes royalties should be enforced (beneficial for creators).
- Platforms that have optional royalties have seen royalty payments to creators go down to below 20%.
Now that you are up to speed, let's get back to what OpenSea is doing.
In the thread, OpenSea proposed a solution that they plan to roll out rather quickly.
There’s been a lot of discussion over the past few months about business models for NFT creators & whether creator fees (“royalties”) are viable.
Given our role in the ecosystem, we want to take a thoughtful, principled approach to this topic & to lead w/ solutions. 🧵
— OpenSea (@opensea)
Nov 6, 2022
- The plan involves shifting the decision to enforce royalties to NFT creators by giving them tools that enforce through code.
- This on-chain enforcement tool is a code snippet that can be added to an NFT smart contract. It will enforce creator fees on new collections starting Nov 8. (Some are calling this a marketplace blacklist. More about this later).
- Additional tools and improvements are coming in the near future to help creators.
- No changes would be made to existing collections until Dec 8. Until then, they are collecting feedback from the community before taking action.
How the code works
Basically, the code snippet is enforcing on-chain royalties by effectively making the NFT untradeable on marketplaces that don't enforce royalties. Now, it is important to note that implementing this feature is at the discretion of the creators. This means creators would have to think deeply about the trade-offs.
The internet's reaction
The community on Twitter was clearly divided. Creators on one side, traders and flippers on the other. Traders called the solution a sham and demanded that reduced fees should come from the platform side, not the creator's side while stating that this is a move to blacklist other marketplaces and protect market share. Creators appeared to applaud the option to build their own framework for royalties.
Protecting creator's/developers' royalties is something the industry will eventually accept. It's hard to say with certainty that the way OpenSea has chosen to execute this will lead to a robust solution - adding code to the standard may pose risks unseen. However, one must applaud the way the company has chosen to take the stage and attempt to lead the discussion.
You can read what Decrypt has to say about it here.
The sneaky news you may have missed
- Mighty Bear Games 1337 Mint: Nov 5 and 6 marked a big day for prominent Web2 game studio Mighty Bear Games, as they minted their first NFT collection. The "mighty net" pass will act as a key to the ecosystem, where the company is building its first Web3 game "Mighty Action Heroes". The collection minted out in just about an hour into its second phase of mint. They were trending on Open Sea at #4 shortly after. Want to know more check them out here. https://mightynet.xyz/.
Until Next time...
Have fun with these gems as I go get a cup of hot choco to warm up from this bone-chilling cold.
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