Why Zero Royalties Stand To Hurt Diverse Creators The Most

The traditional art world suffers from a diversity issue that in many ways Web3 was intended to fix. Zero royalties put that promise in jeopardy.

Working as an artist for the past ten years, Maliha Abidi is all-but-too familiar with getting zero income for her work after the initial sale. 

In part, that’s why she created Women Rise NFT, a collection of 10,000 art pieces representing women from around the world. Unlike when she sells a piece of her physical art, Abidi receives royalties in perpetuity every time a Women Rise NFT changes owners. 

But now, prominent NFT marketplaces like sudoswap and X2Y2 no longer require buyers to pay royalties on certain purchases. And NFT trading volumes are down nearly 100% since May due to the decline of cryptocurrencies overall. 

The result: The livelihood of Abidi and other Web3 creators is in jeopardy. 

“The whole point of royalties is to set new foundations within the Web3 space that stop the exploitation of artists,” she said. “We should be setting an example and pushing the traditional art world to treat artists more fairly.”

Rewarding artists for their work is a common Web3 ethos. Yet creator royalties are not hard-coded into smart contracts or enforceable on the blockchain every time an item sells. When this hard truth entered the public discussion several weeks ago, Web3 leaders came out en masse advocating for royalties. 

“I cannot wrap my head around an art collector in this space purposefully circumventing royalties,” Sofia Garcia, the founder of ArtXCode, posted on Twitter. “When you acquire the work of an artist, you are saying: ‘I support you.’ If you can’t stand by that statement, don’t touch their art.”

Listen: Web3 Check-In w/ Sofia Garcia

The traditional art world also suffers from a diversity issue that in many ways Web3 was intended to fix. U.S. museum collections are composed of as many as 85% white and 87% male artists, due largely to the exclusion that women and people of color experience in the space. But in Web3, creators have open access to marketplaces like OpenSea and LooksRare, providing new opportunities to create audiences for their work. 

Photographer Lori Grace Bailey got into Web3 for that very reason. The idea that she can post her work on her blockchain and create income perpetually for not just her, but her children, was a big driver for her adapting her work. 

She is now focused on using the power of the blockchain to ensure those royalties don’t go away. 

“Decentralization to me and many other artists is about moving the power back into the hands of the creator,” she said. “Creators are now able to utilize and create their own smart contracts via services like Manifold.xyz to ensure the rules are laid out to their exact preferences.” 

For Abidi, zero royalties slowing down the little progress diverse artists have made in Web3 is very real. Since Abidi can only create a certain amount of artwork per year, she is dependent on royalties to ensure that she is financially rewarded if any of her limited work takes off in popularity. 

And that dependency is only heightened during poor market conditions.

“Especially in unprecedented times, artists royalties go a long way for artists to make a living,” she said. “I don’t know what this is even up for debate, to be honest.” 

This is not financial advice. If you don't want to spend money investing in crypto or Web3 — you don’t have to. The intent of this article is to help others educate themselves and learn.

Caroline Fairchild is Editor in Chief at BFF

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