Royalties
What are Royalties
Royalties are a form of payment or compensation that individuals receive in exchange for the use of their intellectual property, such as patents, copyrights, trademarks, or other creative works. It is common in various industries, including music, literature, film, software, and more.
This general concept also applies to blockchain technology; the key difference lies in automation. Through smart contracts, we can designate the owner of royalties and automatically trigger royalty payments when specific actions occur on the blockchain.
So, how do royalties work in KleverChain?
Royalties in KleverChain
In KleverChain, royalties work in conjunction with the assets created by users. Whether it is a token or an NFT, when a user of the blockchain creates an asset, they can specify additional parameters that define how royalties will function for certain transactions related to that asset. For instance, they can set it up so that every time someone transfers the asset to another party, a royalty fee will be charged from that transaction and sent to the royalty owner's address (which can be different from the address of the asset's creator).
Even if the asset has already been created, the Asset Trigger contract allows one to change or initialize a royalty system for that asset. Simply choose the "Update Royalties" trigger type or "Change Royalties Receiver" trigger type if you wish to change the address that receives the royalty fees.
The royalties can even be split between multiple accounts.
Here are all the royalty types in KleverChain:
- Transfer fixed: Charges a fixed amount of KLV every time someone transfers an NFT from one account to another. This applies only to NFTs.
- Transfer percentage: Charges a percentage amount of the asset being transferred to another account. This applies only to Fungible assets.
- ITO Fixed: Charges a fixed amount of KLV every time someone buys an asset from an ITO.
- ITO Percentage: Charges a percentage amount every time someone buys an asset from an ITO.
- Market Fixed: Charges a fixed amount of KLV every time a seller puts their NFT up for sale in a marketplace. This applies only to NFTs. The royalties owner only receives the value after the sale is completed.
- Market Percentage: Charges a percentage fee when someone effectively buys an NFT from a marketplace.
| Type | Contract | Fungibility | Out/In* | Payer | Moment | Currency |
|---|---|---|---|---|---|---|
| Transfer Fixed | Transfer | NFT | Out | Sender | When transferred | KLV |
| Transfer Percentage | Transfer | FT | Out | Sender | When transferred | Currency of the transferred asset |
| ITO Fixed | Buy | FT and NFT | Out | Buyer | When bought | KLV |
| ITO Percentage | Buy | FT and NFT | In | Seller | When bought | Currency of the token price |
| Market Fixed | Sell | NFT | Out | Seller | When sell order placed | KLV |
| Market Percentage | Buy | NFT | In | Buyer | When bought | Currency of the NFT price |
*The royalty can be charged as an additional fee on top of the price (the buyer pays 10 KLV for one asset and an additional 2 KLV for royalties), or the royalty can be deducted from the received value in a transfer/buy contract (the buyer pays 10 KLV, but the seller only receives 8 KLV, as the other 2 KLV go to the royalties owner).