Glossary › NFTs & Gaming › Royalty
NFTs & Gaming Intermediate

Royalty

Definition

A percentage of secondary sale revenue automatically paid to the original NFT creator. Typically 2.5-10%. Royalty enforcement has weakened as marketplaces compete on lower fees.

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Difficulty
Intermediate
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Category
NFTs & Gaming
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See Also
8 related

◆ Key Takeaways

1

A percentage of secondary sale revenue automatically paid to the original NFT creator.

2

Royalty enforcement has weakened as marketplaces compete on lower fees.

Why It Matters

This concept shapes the NFT and digital ownership landscape. Whether you are collecting, creating, or building in the NFT space, understanding it gives you a significant advantage.

Related Terms in NFTs & Gaming

NFT
Non-Fungible Token — a unique digital asset on a blockchain representing ownership of items like art, music, gaming assets, and collectibles. Unlike fungible tokens (BTC, ETH), each NFT is distinct and non-interchangeable.
ERC-721
The Ethereum standard for non-fungible tokens, defining how unique digital assets are created, owned, and transferred. Each ERC-721 token has a unique ID. The foundation of the NFT ecosystem.
ERC-1155
A multi-token standard supporting both fungible and non-fungible tokens in a single contract. More gas-efficient than ERC-721 for collections. Widely used in gaming for items with varying quantities.
Metadata
The descriptive information associated with an NFT: name, description, attributes, and image URL. Stored on-chain, on IPFS, or on Arweave. Metadata quality and storage method affect NFT longevity.
Token URI
The link pointing to an NFT's metadata file, typically a JSON document containing the name, description, image URL, and attributes. Can point to IPFS, Arweave, or centralized servers.
IPFS
InterPlanetary File System — a decentralized storage network where files are addressed by their content hash rather than location. NFTs use IPFS to store images and metadata in a censorship-resistant manner.
Arweave
A permanent, decentralized storage network where data is stored forever through a one-time payment. Preferred over IPFS for NFT storage because data persistence is guaranteed by economic incentives.
On-Chain NFT
An NFT with all data (image, metadata) stored directly on the blockchain rather than external storage. Fully decentralized and permanent but limited by blockchain storage costs. Art Blocks and Autoglyphs are examples.

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