So Sudoswap, a decentralized NFT platform, recently launched a new product called “sudoAMM” to provide liquidity for NFTs and earn fees. It sparked debate because of the potential consequences of its fee structure, which does not honor creator royalties.
Sudoswap’s AMM appears to be on an upward trend in the NFT space, as NFT traders pushed cumulative trading volume on it to over $10 million on August 11.
SudoAMM’s increased popularity may alter the NFT game in terms of creator royalties, allowing you to sell an NFT on the marketplace without having to pay the additional 5% or 10% set as a creator royalty.
The shocking reality is that creator royalties are not hard-coded into smart contracts, and NFT marketplaces must agree to honor them in order for artists to receive royalties on their creations in perpetuity.
“Trading on sudoswap means you only pay a 0.5% fee versus the usual 7.5% (2.5% + 5% royalty) fee on other platforms, enabling better price discovery,” according to their July announcement.
This NFT marketplace has some innovative features, such as allowing users to deposit a combination of NFTs from a single collection and ETH along a specific price range known as a bonding curve. They can then earn trading fees when other users exchange NFTs for ETH and vice versa.
Crypto Twitter is buzzing because the NFT community is railing up in a heated debate on whether Creators should receive royalties or not for their works.
NFT traders will go where the fees are the lowest. They will trade at high frequency, look for arbitrage opportunities, and enter/exit projects and positions to maximize profit. This gives sudoswap a competitive advantage over other marketplaces that honor royalties.
Yawww, a Solana NFT marketplace, sparked a similar debate when it launched earlier this summer without royalties enabled.
The largest NFT marketplaces, such as OpenSea, Magic Eden, and LooksRare, honor creator-set royalty amounts. And it’s only a debate because NFT artists rely on third-party, often centralized entities to execute royalty payments.
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