One of NFTs' most-cited advantages for creators is resale royalties — getting paid every time your work resells, not just on the first sale. The mechanism is real, but it's more fragile than the pitch usually suggests, and understanding why matters if you're planning to rely on it as ongoing income.

How royalties are supposed to work

When you mint an NFT, most marketplaces let you set a royalty percentage (commonly somewhere in the low single digits to around ten percent) that's meant to be paid to you automatically on every future resale, in perpetuity, without you having to do anything further.

Technically, this royalty is usually enforced by the marketplace's own code at the point of sale, not by the NFT's core token standard itself — which is the root of the problem described below.

Why enforcement isn't actually guaranteed

Because royalty payment is typically enforced by marketplaces rather than baked immutably into the token standard, a marketplace can choose to make royalties optional or skip them entirely — and several major marketplaces have done exactly this in response to competitive pressure, since removing mandatory royalties can make trading cheaper for sellers on that platform. A buyer can also resell a piece through a peer-to-peer transaction or a marketplace that doesn't enforce royalties at all, bypassing the creator payment entirely.

Some newer token standards and marketplace tools attempt to enforce royalties more strictly on-chain, but there's no universal, guaranteed standard across the whole NFT ecosystem yet — enforcement varies by marketplace and by the specific contract standard used.

What this means practically for creators

Treat royalties as a potential bonus on top of your primary sale revenue, not as a reliable recurring income stream you can plan around. This isn't a reason to avoid NFTs — primary sales remain the dependable part of the model — but it does mean pricing your initial mint and edition strategy as though royalties might not fully materialize, discussed in our general NFT minting guide.

What to check before choosing a marketplace

If royalty income matters to your strategy, check a marketplace's actual current royalty enforcement policy directly rather than assuming — these policies have changed multiple times across the industry and vary significantly between platforms. For collaborative work, also confirm the marketplace supports automatic multi-party royalty splits if you need them, as covered in our guide to music NFT royalties.