OpenSea, the leading NFT marketplace during the 2021-2022 bull run, is now in the midst of a transition to a new “OpenSea 2.0” launch with a much leaner team to follow fired last fall. And we’re starting to understand what that will look like as the once-dominant market considers its evolution and next steps.
On Tuesday, OpenSea announced support for the ERC721-C Ethereum NFT token standard developed by video game startup Limit Break that allows project creators to enforce royalty payments on secondary market transactions.
It’s OpenSea’s latest move to adapt to changing tides NFT royalty enforcement in the past year and a halfas rival marketplaces shunned once-standard creator fees.
The marketplace had said this would happen at the end of 2022 continue to extract royalties in response to creator pushback and launched a protocol to protect royalties on new collections. But ultimately OpenSea removed from the operator filter protocol and stopped supporting it at the end of February. ERC721-C represents a new attempt to address the royalty problem.
We’re excited to announce that creators can now use ERC721-C from @limitbreak to set up and enforce their own creator monetization on OpenSea.
What is ERC721-C? ERC721-C is a standard that allows creators to implement programmable and enforceable creator monetization on-chain. It’s also… pic.twitter.com/iGAuGsjNid
— OpenSea (@opensea) April 2, 2024
ERC721-C support was made possible by the recent launch of OpenSea’s Seaport 1.6 protocol update, CEO and co-founder Devin Finzer said Declutterwhich lets creators set conditions before an NFT can be transacted, in this case honoring royalties.
“In general, we’re interested in new ways to support creators’ revenues,” Finzer said. “Seaport 1.6 was made possible by the Dencun upgrade to Ethereum, so that was something that allowed us to implement this functionality in this specific way.”
OpenSea laid off about half of its staff in November following a dramatic shake-up among NFT marketplaces earlier this year Upstart rival Blur overtook OpenSea thanks to encouraging transactions through its own token. An OpenSea representative could not confirm the size of the company’s team at the time of publication.
Finzer said the leaner company has reimagined the NFT marketplace experience, with plans to combine the OpenSea and OpenSea Pro platforms into a single interface, develop “a truly streamlined and smooth user onboarding experience” and provide custom interfaces in for categories such as gaming and ticket sales.
“We’re really innovating the product in a pretty big way,” Finzer says. “This means a real visual renewal of the product and a renewal of the infrastructure.”
The shift comes at a time when OpenSea’s market share has faded to a single-digit percentage, with less than 3% of cross-chain trading volume in recent times, according to data from Tiexo– and less than 7% in the last 30 days. The reigning champion of late is Magic Eden, which has launched a rewards program in parallel with an upcoming “NFT” token airdrop.
OpenSea has long resisted the idea of launching its own token, as rivals like Blur and LooksRare have done in the past. It has been the biggest burning question in the market for years, especially as competitors have gained momentum by launching their own tokens or rewards programs tied to future token drops.
When asked whether he thinks such token incentives are sustainable, Finzer wouldn’t elaborate on whether the market will consider creating and dropping its own ecosystem token. But he acknowledged that token incentives are “really exciting” and could be an effective way to align users with the protocols they use.
“Overall, this idea of getting users to participate and be incentivized and attuned to crypto is very exciting,” Finzer said. Declutter. “And that’s something that we’ve seen everywhere in crypto, basically since the beginning of the crypto crisis Bitcoin and Ethereum is that there is more participation – there is more to the game when it comes to using crypto products.”
“I think we’re seeing this trend happening more and more in crypto, and it’s really exciting to see.” he added. “But no, there is nothing to report on our front in that regard.”
Finzer gave a similar answer regarding whether OpenSea plans to provide support Bitcoin ordinal numbersthe NFT-like protocol that helped Magic Eden get an edge above all other rivals in recent weeks. However, he is intrigued by how Ordinals have captured the attention of Bitcoiners, but says recent developments in the Ethereum ecosystem have also been compelling.
“There’s no announcement yet on that front either,” Finzer said of the Bitcoin assets. “But I certainly think the Ordinals ecosystem is quite interesting overall. It really engaged the Bitcoin community.”
However, Bitcoin Ordinals transactions tend to have a higher value, and Finzer said that low-cost transactions over Ethereum Layer-2 networks such as Base are currently a bigger focus for OpenSea.
Of layer 2 reimbursements are falling sharply After the Dencun upgrade, they see significant demand on Base and expect scaling networks to better support use cases such as gaming. Making it easy to move funds across networks and transactions is still a work in progress with layer 2 systems, he added, but he sees their emergence as an important step in bringing NFTs to the masses.
“Gas costs have to go down, right? And the exciting thing is that they have now fallen dramatically. It’s just a matter of sticking things together and making the user experience really good for today’s users,” he said. “Our vision has always been to dramatically reduce costs and scale blockchain so we can support all kinds of use cases.”
