OpenSea Takes Bold Step to Compete with Upstart Rival Blur, Temporarily Eliminating Sales Fee

• OpenSea has effectively cut off its primary source of revenue as well as eliminated its own market fees for a limited time on trades.
• A creator royalty is typically a 5% to 10% cut of the sales price paid to the NFT creator. This is how NFT projects generate revenue after the initial sale of tokens.

OpenSea Cuts Fees and Creator Protections in Response to Competition from Blur

OpenSea, the leading NFT marketplace, has announced that it will be temporarily eliminating its 2.5% sales fee and decreasing creator protections. This is in an effort to compete with Blur, a new marketplace that does not charge any fees and offers looser creator protections.

Under the new policy, OpenSea will only enforce a mandatory creator royalty fee of 0.5% for NFT trades for projects without an on-chain enforcement mechanism. Sellers can choose to pay a higher percentage, but they are not required to do so.

Creator royalties are typically a 5-10% cut of the sales price that is paid to the NFT creator. This is how NFT projects generate revenue after the initial sale of tokens.

OpenSea’s decision comes in response to a significant week for Blur. On Tuesday, Blur distributed its BLUR token to over 100,000 NFT traders. The next day, Blur urged NFT project creators to block OpenSea trades.

Blur does not charge any marketplace fees, which has helped it attract a growing number of users. On-chain data indicates that Blur’s user count is growing rapidly, while OpenSea’s is declining.

In response to Blur’s challenge, OpenSea has announced that its operator filter tool will no longer prevent marketplaces from implementing the same type of approach that it has just revealed. This means that other marketplaces will be able to offer lower fees and looser creator protections, which could further erode OpenSea’s market share.

It remains to be seen whether OpenSea’s changes will be enough to stem the tide of users migrating to Blur. However, the fact that OpenSea is willing to make such significant changes suggests that it is taking the competition very seriously.

Blur Responds by Urging Creators to Block OpenSea Trades

In response to OpenSea’s changes, Blur has urged NFT creators to block OpenSea trades. Blur says that it will only implement full royalty settings for projects that have banned OpenSea.

Blur characterizes the move as a response to OpenSea’s previous decisions, while OpenSea maintains that it sought to safeguard creators as a result of actions by Blur and other competing platforms.

The battle between OpenSea and Blur is likely to continue for some time. It remains to be seen which platform will emerge victorious, but the competition is certainly good for NFT creators.