OpenSea royalties: five creator-earning myths debunked

The Royalty Conflict

OpenSea processed $430 million in trading volume during a recent 30-day period, while Blur handled $816 million in the same timeframe. Blur users access listings from OpenSea and LooksRare through an aggregator interface. Because OpenSea automatically sets royalties to optional when it detects trading on Blur, creators must use on-chain tools to block the rival marketplace if they want to enforce full creator earnings on all secondary sales. To earn full royalties on OpenSea, creators of smart contracts made after January 2, 2023, must use on-chain tools to block marketplaces like Blur. If they do not block these platforms, OpenSea reduces creator royalties to an optional status. Blur advises creators to block OpenSea to ensure they receive full royalty payments. This competition forced OpenSea to temporarily eliminate its 2.5% marketplace fee and lower mandatory creator royalties to 0.5% for certain projects. The struggle involves a difficult tradeoff between strict royalty enforcement and composability. Blocklists allow creators to shut down contracts that circumvent royalties, but bad actors can simply spin up new marketplaces to evade them. Allowlists provide more security because they only permit transfers through approved smart contracts, but they also restrict an NFT’s ability to interact with DeFi or gaming applications.

The Volume Illusion

Market volume figures often mask significant manipulation. A study by Gerry Tsoukalas found that wash trading accounts for 38% of NFT trades and 60% of the total traded value across several major exchanges. On LooksRare, wash trading accounted for 95% of trade volume because the platform offered aggressive rewards for trading. While 110 traders in a single study netted $8.9 million from wash trading, 152 accounts lost $416,000 because the cost of gas fees exceeded the profits they made from the transactions. Do you know how much of your favorite collection’s volume is actually self-trading? The researchers developed a machine-learning framework that uses public blockchain data to identify likely wash trades by looking for patterns like self-trades or circular trades where an asset passes through three or more wallets. These models can detect self-trades where a user moves an NFT between two wallets they control or circular trades where an asset ends up back with the original owner. Researchers also identify common funding, where both the buyer and seller are funded by the same source. Jarod Koopman of the IRS notes that the agency looks for traders who purposely manipulate the market to take advantage of other investors. Even as detection improves, there is a concern that AI agents might learn to collude and artificially pump prices.

The Concentration Myth

The concentration of money in the creator economy makes the idea of a broad middle class a myth. The top 1% of creators captured 21% of all payment volume in 2025, up from 15% in 2023. Only 11% of surveyed creators earn six-figure annual incomes. Instead of chasing massive audiences, 44% of communities consist of only 1 to 100 members. Most creators prioritize transformation over reach, with 69% of creators identifying member transformation as their primary growth strategy. Most creators now function as solo entrepreneurs, with 48% running their content, community, and monetization alone. This shift moves revenue away from social platforms toward owned, recurring models. For instance, 88% of creators monetize through paid memberships, whereas only 18% earn from sponsorships. YouTube paid more than $100 billion to creators, artists, and media companies over the past four years. While 67% of creators find new members via social platforms, they increasingly move monetization downstream to owned spaces. The global creator economy was valued at roughly $200 billion in 2025 and shows a 22.7% compound annual growth rate.