In 2012, Goblintown non-fungible tokens gained popularity as a result of holders’ urinating on them. Some of them are now dissatisfied with the unexpected movements made by the creator.
Truth Labs, the creator of the Goblintown Ethereum NFT collection that became popular as the NFT market crashed last year, has been accused of “rugging” investors by converting all of the project’s artwork into animated GIFs of a middle finger grasping three more middle fingers.
“Ignore royalty fees. To hell with construction and artistic support. Flipping is the defining characteristic of Web3. To hell with the community, revere the flipper. “Long live the slow rug,” read one hundred thousand animated NFTs.
Truth Labs continues to advocate for the enforcement of creator royalties despite recent decisions by leading marketplaces Blur and OpenSea to only enforce a minimal 0.5% creator royalty charge for a number of products. A creator royalty is a fee associated with the sale of a non-fungible trading card on the secondary market, which typically ranges from 5 to 10 percent of the transaction price.
The sarcastic and mocking tone appears to reflect the company’s perception of a shift among some merchants who no longer honor full creator royalty payments when selling NFTs, and perhaps also among marketplaces that permit such conduct.
Truth Labs also announced on Thursday that it had disabled the bidding, listing, and trading of Goblintown NFTs on OpenSea and Blur in preparation for the migration of its NFTs to a new smart contract that fully enforces creator royalty payments on-chain. Smart contracts consist of the code that powers autonomous decentralized applications (dapps) and NFT initiatives.
Truth Labs stated that it will promptly airdrop a new version of each affected NFT, complete with the original artwork, to holders’ wallets before the end of the day on Sunday.
Frequently, “rugs” are projects that developers have abandoned or failed to execute on. This has not been done by Truth Labs, but the abrupt change in artwork and trading limits has not been well received by all holders. This was also achieved with its lesser-known NFT collections, including IlluminatiNFT, The 187, and Grumpls.
Truth Labs did not respond to Decrypt’s request for comment in a timely manner.
What is this thing’s significance? Truth Labs intends to retain creator royalties and its chosen percentage of revenue from all secondary sales of its NFTs, a sentiment shared by many other creators, projects, industry participants, and NFT markets over the past few months as the NFT ecosystem has been disrupted.
Beginning this summer, new marketplaces began to challenge the long-standing custom of honoring full creator license rates by luring customers away with cheaper exchanges, thereby taking market share. Consequently, as their once-dominant market share diminished, more established markets quickly followed suit.
Royalties can be a significant source of revenue for NFT creators, especially for once-popular collections such as Goblintown. According to CryptoSlam data, the project has seen over $101 million in trade activity to date, the majority of which occurred in May and June 2022, shortly after the free NFT mint.
“We as a team are committed to enforcing a royalty level that makes farming an unprofitable activity. All Truth collections will have 5% royalty going forward,” Truth Labs announced on Tuesday. “Farming” refers to Blur’s NFT marketplace, which compensates traders for flipping NFTs but is perceived by others in the industry as a form of market manipulation.
Although the discussion of royalties is divisive among NFT producers and collectors, many Goblintown proprietors have viewed Truth’s decision to support royalties with skepticism. Some have criticized the team for failing to provide Goblintown’s proprietors with “value” and for engaging in “centralized decision-making.”
In response to the news, ArtsDAO co-founder Rahim Mahtab stated, “It goes against the ethos of this space to deny your holders the opportunity to make this decision.” Another Twitter user referred to the trade suspension as “unacceptable,” adding, “Go back to Web2.”
Goblintown began as a freewheeling, devil-may-care initiative to celebrate toilet humor, as well as the depravity and decadence of NFT traders and the subculture that has developed around them. Despite this, some collectors are perplexed by the manufacturers’ demand that they adhere to their guidelines.
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