Meta’s new 47.5% fee on Metaverse items has pissed off NFT Twitter

Meta

It’s almost six months ago the company formerly known as Facebook changed name to Meta, a nod to its ambitions in the meta-verse. Monday the company released details about how it plans to monetize its Horizon Worlds metaverse app, which is currently only available via VR, launching a test phase that will allow some creators to sell items around the world to users.

One aspect in particular has been grabbed by NFT Twitter: the fact that Meta is taking 47.5% down on every transaction.

For every item sold in Horizon Worlds, a 30% cut goes to Meta via the Oculus platform, and 25% of the remaining amount goes to the Meta App Store. That’s more than Apple’s often criticized App Store fee of 30%, and much greater than what NFT retailers are used to. In the NFT area, the OpenSea marketplace takes a 2.5% reduction on each transaction, and creators typically take between 2.5% and 7.5%.

To be precise, the items Meta sells are non-fungible tokens. They are more reminiscent of the skins and animations that you can currently buy in games like Fortnite. But the metaverse that Meta builds competes with crypto-native metavers such as Sandbox and Decentralandwhere goods in the world are owned as NFTs.

The core of the question is a philosophical point about how metavers should be constructed. A metaverse is any digital world frequented by large groups of people – think Second Life or even games like World of Warcraft. The question is whether the next wave of metavers, driven by the world’s largest social media company, should be closed or open. A closed metavers is a run by a central authority where lands and objects are owned by the company that built the world. An open metaverse allows people to buy and own metaverse land and objects like NFTs and exchange them for cryptocurrency.

Take Sandbox, for example. It is a blockchain-integrated world that is now in beta testing, consisting of fixed 166,464 blocks of land that can be purchased and used as real-world property. Creators make items in the world that they sell for $ TRUE, the original cryptocurrency that can then be exchanged for ether.

The argument is that open metavers will be more organic, virtual communities compared to centrally designed metavers like Horizon Worlds. “Facebook charging 47.5% for every NFT sale is the best thing that has ever happened to us,” reads a tweet, with the implication that Meta’s excessive fee will drive creators towards open metavers like Sandbox and Decentraland.

Crypto boosters say that buying an item in the world like an NFT allows you to truly own it – you can sell it, trade it, or keep it as an investment, just like real-life goods. Meta appears to be aiming to copy some of this benefit, as CEO Mark Zuckerberg said on Monday: “Clearly, the ability to sell virtual goods and be able to take them with you from one world to another. another will be an important part. [of the metaverse]. ”

That Meta would charge 47.5% is offensive to NFT traders, who may point out that Decentraland and Sandbox items carry 2.5% and 5% creation fees, respectively. Yet metavers like Sandbox serve as speculative options where the value of goods can be bought and sold at a profit (or loss). Under this model, creators make money by skimming money from big tickets, which may never be part of the world that Meta builds. Sandbox’s 5% fee is a lot when the item sold is a $ 4.3 million plotcompared to Meta’s cut of 47.5% of a $ 10 costume.

Many people believe that the metaverse is the next big thing: Facebook changed its name to Meta to reflect that belief, and Nvidia’s CEO believes that the metaverse economy will be bigger than the real world. What metavers look like, however, is still up in the air. Much is still unknown about what Horizon Worlds will look like. Meta has previously said that NFTs will be integrated in at least a limited way in its metaverse, and the company is is also reportedly working on a world currency.

Meta has been contacted for comment but did not respond immediately.

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