When did the top ten Ethereum NFTs in royalties encounter a turning point?

*Original text: "Most Profitable NFT Projects by Royalty Earnings on Ethereum", author Nicholas Boey, compiled by Odaily Planet Daily Jessica. *

This article examines the profitability of top NFT projects on Ethereum based on royalties earned from launch to July 12, 2023. This analysis only considers royalty income and does not include any other external sources of income. Royalties are converted to USD based on CoinGecko price data at the time of sale. The study focused specifically on Ethereum-based collections of NFTs, with the following findings:

The most profitable NFT project on Ethereum

**Yuga Labs (BAYC) was the most profitable, bringing in $59.1 million in royalties from April 23, 2021 to July 12, 2023, followed closely by Otherside at $53.3 million (royalty usage fee). Interestingly, 81.2% of the royalties earned by Otherdeed were generated in the same month that the series launched in May 2022, indicating the huge hype surrounding the series' release. **

**MAYC is the third most profitable series with cumulative royalties of $43.7 million. These three series account for the majority of Yuga Labs' overall royalty revenue, totaling 87.3%. **

**The second most profitable project is Nike's fashion platform RTFKT, from March 3, 2021 to July 12, 2023, the project has accumulated royalties of 83.7 million US dollars. RTFKT's most profitable series is CloneX, a collaboration with renowned artist Takashi Murakami, which has generated $37.9 million in royalties. This was followed by CloneX Mintvial and MNLTH, with cumulative $13.9 million and $16.4 million, respectively. Despite the release of more than 20 series, these three series make up the majority of RTFKT's royalty income, accounting for 81.5% of the project's total. **

**Azuki development team Chiru Labs ranks 3rd in terms of royalty income, with cumulative revenue of $59.2 million from January 12, 2022 to July 12, 2023. The majority of Chiru Labs' royalties can be attributed to its flagship line, Azuki, which accounted for 75.5% of the company's total revenue. The Beanz followed with $12.4 million in royalties, with their latest line, Azuki Elementals, already raking in $1.5 million just two weeks after its launch from June 27, 2023 to July 12, 2023. **

Top 10 Ethereum NFTs Mined by Footprint

Top 10 Most Profitable NFT Projects (by Ethereum Royalty Income)

** NFT royalties earned on Ethereum every year **

**2022 is the most profitable year for NFT projects on Ethereum, with royalties of $330.8 million, accounting for a staggering 69.6% of the total royalties earned from March 2021 to July 2023. The top earners were Yuga Labs and RTFKT, with $115 million and $57 million, respectively. Chiru Labs is a notable newcomer, taking the third spot among one of the most lucrative NFT projects, with $53.8 million in royalties. Launching in 2022, Murakami also ranks among the top 10 projects in terms of royalty income. **

**Meanwhile, sales in 2021 (March 2021 to December 2021) contributed significantly, accounting for 23.2% of total royalties for the period, which totaled $110.4 million. Yuga Labs topped the list with $41.7 million, followed by RTFKT with $24.7 million and Parallel.Alpha with $18.2 million. **

**However, while 10 of the 10 most profitable NFT projects in 2022 continued to hit record high royalties, Parallel Alpha saw a sharp decline, earning only $4.8 million in 2022 revenue, which is 73.5% lower than its 2021 revenue. **

** Looking at sales from January 2023 to July 2023, only earned 7.2% of total royalties for the same period, amounting to $34 million. Yuga Labs maintained its lead with $22.1 million in revenue, while Chiru Labs overtook RTFKT for second place with $5.4 million. RTFKT followed with $2.1 million in royalties. **

**To put this in perspective, the top 10 most profitable NFT projects would need 9.7x current royalties to reach 2022 revenue. These figures mark a major shift in the NFT market, as both collectors and traders choose to avoid paying royalties entirely, while transaction volumes generally decline in 2022-2023. **

**When is the most profitable NFT project on Ethereum? **

The top 10 NFT projects on Ethereum by royalty revenue have been on an upward trend in 2021 and 2022, peaking in April and May 2022, where the profitability of NFT projects soared sharply, and the top 10 The project's total assets in 2022 are $175.5 million. This compares to a total investment of $155.3 million in these projects in the remaining months of 2022.

Yuga Labs and Proof Collective were the most eye-catching of these projects, and they launched new collections during this period. Yuga Labs' Otherdeed series stood out, generating just $43.3 million in royalties, or 48.3% of the total royalties earned by the top 10 titles in May 2022. Likewise, Proof Collective's Moonbirds franchise generated $21.2 million in royalties, or 24.7% of the total royalties earned by the top 10 titles in April 2022.

**This trend of receiving huge royalties in the month of release is common among NFT projects. This can be attributed to the spike in transaction volume when the project was first launched. **Another notable example is Chiru Lab's Azuki collection, which debuted in January 2022 and generated $10.9 million in royalties that month alone. That amount accounted for 24.4% of Azuki's collection revenue in January alone.

In June 2022, the royalties of NFT projects fell sharply by 88.1%, from a peak of US$89.7 million in May 2022 to US$10.7 million in June 2022. This reflects market sentiment following Terra's fall in May 2022. Terra raised investor concerns about potential contagion effects in the NFT space, leading investors to be more cautious and reluctant to participate in the highly speculative digital asset.

**In July 2022, the launch of Sudoswap, a decentralized NFT exchange, sparked discussions within the NFT community about the necessity of creator royalties. **Subsequently, some NFT marketplaces began to employ optional royalties to attract users to their platforms. OpenSea responded in November 2022 with a tool for enforcing creator fees on-chain. However, their efforts hit a setback when Blur discovered a vulnerability in January 2023, prompting OpenSea to revert to optional royalties without on-chain enforcement in February 2023.

**With the passage of time, the cancellation of creator royalties has resulted in a significant decline in the royalty income of top NFT projects. **Overall, total royalties earned by these projects plunged 91.0% from $303.5 million in Q1 2022 to $27.3 million in Q2 2022.