How to Make Your First Ethereum NFT Royalties!

In the fast-paced world of digital art and collectibles, non-fungible tokens (NFTs) have taken center stage. NFTs have captured the imagination of artists, creators, and collectors alike, offering a new way to buy, sell, and trade digital assets. But what makes NFTs even more compelling for creators is the potential for NFT royalties. In this comprehensive guide, we will walk you through the process of making your first Ethereum NFT royalties, ensuring you not only earn from the initial sale but also from secondary market transactions.

Understanding NFT Royalties

What are NFT Royalties?

At its core, NFT royalties represent an ingenious concept within the world of NFTs. When an artist creates and mints an NFT, they have the ability to program a royalty fee into the token’s smart contract. This fee, typically a percentage of the resale price, is automatically paid to the original creator every time the NFT changes hands. This unique feature ensures that artists continue to benefit financially from their work even after the initial sale.

NFT royalties are a powerful tool for creators. They provide a source of passive income and align the interests of artists and collectors, as both parties have a stake in the NFT’s future value.

How NFT Royalties Work on the Ethereum Blockchain

To grasp the mechanics of NFT royalties, it’s essential to understand the Ethereum blockchain’s role. Ethereum, one of the most widely used blockchain platforms for NFTs, supports two primary standards for NFTs: ERC-721 and ERC-1155.

1. Smart Contracts and Blockchain Technology

NFT royalties are made possible through the use of smart contracts. These self-executing contracts are integral to the Ethereum blockchain and facilitate the automation of royalty payments. When an NFT is created, the smart contract is programmed to include the creator’s wallet address, royalty percentage, and instructions for handling royalties.

2. ERC-721 and ERC-1155 Standards

Ethereum’s NFT standards, ERC-721 and ERC-1155, play a crucial role in royalty distribution. ERC-721 is the standard for single, unique NFTs, while ERC-1155 supports both single and multiple copies of NFTs. Both standards include provisions for royalty payment, making it easy for creators to implement this feature.

Creating Your Ethereum NFT

Setting up a Digital Wallet

Before diving into the world of NFTs and royalties, you’ll need a digital wallet. Ethereum wallets come in various forms, including software wallets, hardware wallets, and web-based wallets. Some popular options include MetaMask, Trust Wallet, and Ledger Nano. Here’s a brief overview of the process:

1. Choose Your Wallet

Select a wallet that aligns with your needs and security preferences. Consider factors like ease of use, security features, and compatibility with NFT marketplaces.

2. Create and Secure Your Wallet

Follow the wallet provider’s instructions to create your wallet. Ensure you store your wallet’s private key securely, as it grants access to your digital assets. Losing your private key means losing access to your NFTs and royalties.

Minting Your NFT

Once you have your digital wallet in place, it’s time to mint your NFT. Minting is the process of creating a new NFT and uploading it to the blockchain. Here are the steps involved:

1. Choose the Right Platform

Select an NFT marketplace that supports Ethereum. Platforms like OpenSea, Rarible, and SuperRare are popular choices. Each has its unique features, fees, and user base, so explore them to find the best fit for your art.

2. Uploading Your Digital Artwork

Once on the platform, look for the option to create a new NFT. You’ll be prompted to upload your digital artwork. Ensure the file meets the platform’s specifications for format, size, and resolution.

3. Adding Metadata and Royalties Information

This is where the magic of NFT royalties happens. While creating your NFT, you’ll have the opportunity to set the royalty percentage you want to earn from secondary sales. Common percentages range from 5% to 15%, but you can choose what suits you best. This royalty information is stored in the NFT’s smart contract.

Understanding Royalty Options

Fixed Royalties vs. Variable Royalties

When setting up your NFT royalties, you have the choice between fixed and variable percentages. Each has its advantages and considerations.

1. Fixed Royalties

Fixed royalties are a set percentage that remains constant regardless of how many times the NFT changes hands. For example, if you set a fixed royalty of 10%, you will always receive 10% of the resale price, no matter if the NFT is resold once or a hundred times.

2. Variable Royalties

Variable royalties allow you to set different percentages for different sales. This gives you the flexibility to earn higher royalties from early sales and lower royalties as the NFT appreciates in value. For instance, you could set a 20% royalty for the first resale and reduce it to 10% for subsequent resales.

Setting Royalty Percentages

Choosing the right royalty percentage is crucial. There’s no one-size-fits-all answer, as it depends on your goals and the perceived value of your artwork. Here are some considerations:

1. Industry Standards and Recommendations

Industry norms suggest royalty percentages between 5% and 15%, with 10% being a common choice. However, some artists have successfully set higher royalties, especially if their work is in high demand.

2. Finding the Right Balance

Strike a balance between earning royalties and encouraging secondary market activity. High royalties may deter collectors, so consider your target audience and their willingness to pay for your NFTs.

Launching and Promoting Your NFT

Choosing the Right Marketplace

Selecting the right NFT marketplace is crucial for your NFT’s success. Here are some factors to consider:

1. Overview of Popular NFT Marketplaces on Ethereum

  • OpenSea: The largest NFT marketplace, offering a wide range of NFT categories.
  • Rarible: Known for its decentralized governance and creator-centric approach.
  • SuperRare: Specializes in high-end digital art NFTs, often associated with exclusive artists.

2. Considerations for Fees and Exposure

Different platforms have varying fee structures, including listing fees, gas fees, and marketplace fees. Research these fees and weigh them against the platform’s reach and audience to make an informed decision.

Creating an Enticing Listing

Once you’ve chosen your marketplace, it’s time to create a listing that captures potential buyers’ attention. Here’s how:

1. Crafting a Compelling Title and Description

Your title and description should tell a story about your NFT, its significance, and your creative process. Use keywords and relevant tags to make your NFT discoverable.

2. Setting a Reasonable Starting Price

Consider your NFT’s value and the current market conditions when setting your starting price. A competitive starting price can attract more bidders and increase the likelihood of a higher final sale price.

Promoting Your NFT

Creating an NFT is just the first step; promotion is equally crucial. Here are some strategies to get the word out:

1. Leveraging Social Media and Online Communities

Share your NFT listing on platforms like Twitter, Instagram, and Discord. Engage with your audience, answer questions, and build a community around your work.

2. Collaborations and Partnerships

Collaborate with other artists, influencers, or NFT projects to expand your reach. Joint promotions can introduce your NFT to a wider audience.

Earning Royalties

Primary Sales Royalties

Primary sales royalties are straightforward. When someone purchases your NFT on the primary market (i.e., the initial sale), the royalty percentage you set in the smart contract is automatically transferred to your wallet. It’s a seamless process that requires no additional effort on your part.

Monitoring Your Earnings

Most NFT marketplaces provide tools to track your earnings. You can see how much you’ve earned in royalties from each sale, providing valuable insights into your NFT’s performance.

Secondary Market Royalties

The real magic of NFT royalties happens in the secondary market. When your NFT is resold, you continue to earn royalties. Here’s why this is significant:

Exploring the Benefits of Royalties on Resale

  1. Passive Income: Secondary market royalties offer a source of passive income for artists. As your NFT gains popularity and value, these royalties can become a substantial income stream.
  2. Long-Term Value: NFTs can appreciate in value over time, and you’ll benefit from each resale. This aligns your interests with collectors, as both parties want to see the NFT’s value increase.

Best Practices and Tips

Protecting Your Digital Assets

While NFTs provide an exciting opportunity, they also come with potential risks. Protect your digital assets with these strategies:

1. Strategies to Prevent Unauthorized Use

Consider watermarking your digital artwork or releasing lower-resolution versions for display purposes. This can discourage unauthorized use.

2. Copyright Considerations

Understand copyright laws in your jurisdiction and how they apply to digital art. Consult legal experts if needed to ensure your rights are protected.

Staying Engaged with Your Community

Building and nurturing a community of collectors and supporters is essential for long-term success. Here’s how:

1. Building a Loyal Following

Engage with your audience on social media and in NFT communities. Share your creative process, behind-the-scenes content, and updates about your work.

2. Responding to Collector Inquiries

Be responsive to collector inquiries and requests. Building positive relationships can lead to repeat sales and referrals.

Case Studies and Success Stories

To illustrate the power of NFT royalties, let’s look at a few case studies and success stories from the NFT world.

Artist A: Fixed 10% Royalty

Artist A, a talented digital artist, minted an NFT with a fixed 10% royalty. After the initial sale, the NFT changed hands several times on the secondary market. With each resale, Artist A received 10% of the resale price. Over time, their royalties added up to a substantial income, allowing them to focus more on their art.

Artist B: Variable Royalties

Artist B decided to experiment with variable royalties. They set a 20% royalty for the first resale, which incentivized early collectors to buy their NFT. As the NFT’s value increased, Artist B gradually reduced the royalty to 10%. This strategy boosted initial sales and maintained interest in their work.

Future Trends and Developments

As the NFT landscape continues to evolve, several trends and developments are worth keeping an eye on:

Predictions for the NFT Market and Royalties

  • NFTs are likely to become more integrated into mainstream culture, attracting a broader audience of collectors and creators.
  • Royalties could become a standard feature on most NFT marketplaces, further increasing their prevalence.

Emerging Blockchain Technologies

New blockchain technologies may impact NFT royalties and how they are distributed:

  • Layer 2 solutions and Ethereum upgrades could reduce gas fees, making NFT royalties more cost-effective.
  • Interoperability between blockchain networks may expand royalty opportunities beyond Ethereum.


In the exciting world of NFTs, earning royalties on your Ethereum NFTs is a game-changer for artists and creators. It not only provides a source of passive income but also strengthens your connection with collectors who share in your success. By understanding the mechanics of NFT royalties, choosing the right platform, and implementing smart strategies, you can embark on a journey to make your first Ethereum NFT royalties, ensuring that your creativity continues to be rewarded in the digital age.

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