Welcome to Magic Eden, your go-to EVM marketplace for NFT collections. At Magic Eden, we believe in empowering creators by providing robust royalty settings that ensure fair compensation for their digital assets. In this guide, we'll walk you through the intricacies of royalty settings on our platform including a FAQ section, allowing you to maximize your earnings and take full advantage of the opportunities offered by the burgeoning NFT market.
Understanding royalty settings
Royalties are fundamental in the NFT ecosystem, providing creators with a mechanism to earn a percentage of the resale value for their work, ensuring fair compensation for their contributions.
Recent advancements like ERC721-C and ERC-1155C offers a comprehensive avenue for creators to secure their earnings. With ERC721-C, creators gain enhanced control over their royalties, allowing for enforceable on-chain programmable royalties—a significant step towards fairness and transparency. This contract effectively allows creators to block platforms which do not respect creator royalties. (These steps also apply to any 721 or 1155 contract.)
At Magic Eden, royalties are paid out in a structured manner to prioritize creator compensation. Here is the order at which royalties are prioritized:
1. ERC2981 setup
Initially, if a collection has ERC2981 setup on the contract, royalties will be distributed according to the specifications of this protocol. This ensures seamless and transparent royalty payments for creators. No further action is needed to be taken by the creator or the platform.
2. PPv2 backfilled royalties
In cases where ERC2981 setup is not available, Magic Eden utilizes PPv2 backfilled royalties as an alternative method. This ensures that creators still receive their rightful share of the resale value, enhancing the overall fairness of the marketplace. Review the subsequent section for further instructions on setting this up.
3. Royalty Registry
Finally, integration with the Royalty Registry facilitates on-chain royalty configurations, empowering creators, particularly those with older collections, to align with current standards and ensure equitable compensation. Please review our article specifically on using the royalty registry.
If you have used the Royalty Registry and it is not being reflected on Magic Eden EVM, please reach out to our support team by opening a ticket using the purple chat widget.
Setting up PPv2 backfilled royalties
To set up PPv2 backfilled royalties for your collection, follow these step-by-step instructions:
Connect to developers.freenft.com
Visit developers.freenft.com and connect your wallet as the contract owner.
Manage your collections
Navigate to the "Manage my collections" section and input your contract address. Click "RETRIEVE CONTRACT DATA" to proceed.
Configure payment processor settings:
Scroll down to locate the "Payment Processor Settings" section. Here, you'll find "Configuration Settings" where you can input the "Royalty Backfill Numerator" and "Royalty Backfill Receiver" values.
Update settings
Once you've entered the required values, click "UPDATE PAYMENT PROCESSOR SETTINGS" to finalize the setup. Please note that a gas fee will apply for this transaction.
ERC-2981 FAQ:
How Are Royalties Configured Using ERC-2981?
Creators set a default royalty amount when the contract is deployed.
Creator adds a custom “update” function so they can change the royalty rate after the contract is deployed.
How Can Creators Update to ERC-2981 Royalties?
By default, ERC-2981 does not come with a way to update royalties after the contract is deployed, so you will need to add this yourself if you wish to change their royalty rate in the future.
How Does a Payment Processor Utilize ERC-2981 to Facilitate Royalty Payments?
ERC-2981 is the primary method payment processor uses to pay royalties. It reads this data on-chain from the NFT contract when an item is purchased. Payment processor attempts to call the “royaltyInfo” function on the NFT contract to determine how much royalties should be paid, and to which address.
Is it Possible for Creators to Add ERC-2981 to Their Existing Contract?
Only contracts that are “Upgradeable” can add ERC-2981
What If the Creator Is Unable to Add ERC-2981?
Creators should configure “backfilled” PPv2 royalties on their contract.
Backfilled PPV2 Royalties FAQ:
Trouble Updating Backfilled Royalties?
In order to update backfilled royalties, creators must connect to the website using the address of the contract OWNER. The contract owner is defined by implementing EIP-173 on their contract or by using OpenZeppelin Ownable Implementation which adds a “owner” function to the contract which payment processor will check for when updating the backfill royalty.
What If the Creator Doesn't Have Ownership of the Contract (i.e., Not Ownable)?
Creators can rely on Royalty Registry if it's already configured, or work with us to set up custom royalties. Creators can also use OpenSea royalties if it's already configured.
By leveraging the powerful royalty settings available on Magic Eden, creators can unlock new revenue streams and maximize their earnings in the dynamic world of NFTs.
If you have any questions or require assistance, our dedicated support team is here to help. Simply reach out to us via the chat widget on help.magiceden.io, and we'll be happy to assist you every step of the way.