Moonbirds Nearly Doubles Cool Cats All-Time Royalty Fees This Week
Moonbirds, a collection of 10,000 utility-enabled NFTs from Proof Collective, launched and sold out on Apr. 16 with a mint price of 2.5 ETH. Since then, the project has amassed more than $14 million in royalty fees from nearly 90,000 ETH (~$283 million) worth of secondary sales on OpenSea.
In comparison, Cool Cats, a successful OG NFT project that launched back in July 2021, has earned slightly more than $8 million in 10 months from royalty fees. In Ether terms, Cool Cats is still in the lead at 101,000 ETH, but that seems likely to change soon.
The Moonbirds team takes a 5 percent cut on each secondary sale, a fairly standard practice in the NFT space. Cool Cats, until recently, took a 2.5 percent cut on each secondary sale. But with the launch of Cooltopia, the Cool Cats team decided to double that percentage to the standard 5 percent, a move that was met with opposition by some on NFT Twitter.
Cool Cats really had the audacity to raise their royalty fees 😂 actually wild. Rooting for them but can’t logically be bullish on a team this out of touch.— Willy ₿ullish 🍌 (@WillyTheDegen) April 15, 2022
If Cool Cats had taken 5 percent from the beginning, they’d have made more than $16 million from royalty fees in slightly less than a year.
OpenSea also takes a 2.5 percent cut on each secondary sale, another fairly standard practice for NFT marketplaces. In the last week on Moonbirds volume alone, OpenSea earned more than $8 million in marketplace fees.
It’s clear the secondary marketplace is a massive revenue stream for successful NFT projects, but where does the money go? In the case of Moonbirds, is it necessary for projects to collect millions of dollars on a weekly basis?
Moonbirds, the popular NFT project from @proof_xyz, earned more than $11 million in royalty fees in the last four days.— Lucky Trader (@LuckyTraderHQ) April 19, 2022
It is quickly approaching $250 million in total sales volume in less than a week. In comparison, Cool Cats has done ~$312 million all time.#Moonbirds pic.twitter.com/0OWpuht0qH
OpenSea is a for-profit business that cares little about the overall success or failure of one specific project. Its job is to extract value on all NFT transactions. But Moonbirds and Cool Cats shouldn’t be extracting value from their own projects. And they’re likely not.
Each project is free to spend marketplace royalty fees however it sees fit. They’re all unique and have their own marketing and growth opportunities. But in general, marketplace royalty fees are used to further the development of NFT projects, whether through branding opportunities, gaming developments, new personnel acquisitions, or something else.
Time will tell what Moonbirds decides to do with its $14 million (and growing) royalty fee treasury. As for Cool Cats, the team is using their funds to solve one of the blockchain’s most difficult problems: frictionless gaming.
For more on Cool Cats unique royalty fee strategy, see “Cool Cats | Using Royalty Fees to Solve Frictionless Blockchain Gaming” (coming soon).