OpenSea’s royalty policy changes have accelerated the exodus of creators.
At the same time, all eyes are on ‘OKX’, which is looking to expand its NFT marketplace. Also there is ‘friend.tech’, an emerging player in the Web3 space, to attract active users.
According to Dune Analytics, OpenSea’s Ethereum-based monthly active traders in September were around 92,000. The number is measured based on registered users who have made at least one transaction, which is about 18% of the peak of 511,762 in February 2022. That’s a drop of 419,762 monthly active traders in just 18 months.
At the center of the exodus is a change in ‘royalty policy’. Previously, OpenSea switched its creator royalty policy to an “opt-in” model. This caused NFT creators to leave and look for alternative platforms. OpenSea announced plans to scrap the operator filter and switch all secondary sales of new collections to an optional creator fee. The move was met with criticism from the Web3 industry. Most notably, billionaire investor Mark Cuban criticized NFT marketplace OpenSea’s plans to stop enforcing creator royalties. He also emphasized that NFT platform Recur will be phased out. OpenSea was faced with the most threatening data to its viability. Many NFT creators have been making a living from royalties, so this can be a crisis. According to Dune Analytics, royalties paid to creators on OpenSea have dropped 76% in the past two months to $83,970 as of November 21.
In the meantime, it’s worth noting the moves by emerging players to attract active NFT users. OKX, in particular, has continued to expand its NFT marketplace. As of September 16, trading volume on OKX’s NFT marketplace increased 114% to $11.54 million. This is noteworthy as it is attracting liquidity from other exchanges, beating out Blur and Opensea. According to Wu Blockchain, The overall active addresses of OKX NFT Marketplace are about 49.6% of Blur and 14.8% of OpenSea, which may be more attractive to Degen players. About 31.13% of the addresses come from Power Users.
The second half of the year will also see the arrival of a new big player, friend.tech. Recently, the TVL of the Base-based Web3 social media app friend.tech reached $20,161,989. In the last 9 days, the daily trading volume was $12.3 million. That’s more than OpenSea. Who are friend.tech’s active users? There has been an increase in participation from creators as well as famous YouTubers who have nothing to do with crypto. As freind.tech continues to improve its UI and add features such as the option to purchase with a credit card, it will continue its strategy to attract active users.
In the Web3 ecosystem, there are no absolute power houses forever. If OpenSea, the centerpiece of the NFT marketplace, continues to lose active users, it will only be a matter of time before it is overtaken by emerging rivals.