Secondary-sale royalties were treated as a defining feature of NFT markets, then largely stopped being paid. The reversal happened because the payment was never enforced where the ownership actually changes.
Transfers do not know a sale occurred
The common token standards define a transfer function that moves a token from one address to another. That function takes no price and has no concept of payment.
A sale is therefore assembled elsewhere, usually by a marketplace contract that receives money, forwards a share to the creator and then calls the transfer.
Because the royalty lives in the marketplace layer rather than the token, it applies only when the sale goes through a marketplace that chooses to apply it.
The metadata standard describes but does not compel
There is a widely adopted interface for publishing a royalty amount, which lets any platform ask a collection what it expects to be paid.
Reading that figure is voluntary. The interface is a way to advertise the intended fee, not a mechanism that deducts it.
For a while nearly everyone honoured it, and the distinction between a convention and a rule went unnoticed because no one was testing it.
Fee competition made the convention expensive
Marketplaces compete for order flow, and a venue that skips the creator fee offers sellers a visibly better outcome on identical goods.
Once one venue did so successfully, others faced a choice between losing volume and matching the terms. Most made royalties optional, defaulted them low, or dropped them altogether.
Sellers responded predictably. The share of trades routed through fee-honouring venues fell sharply, and creator income from resales fell with it.
Enforcement attempts move the rule into the contract
The technical response was to make the token itself refuse certain transfers, blocking any operator contract not on an approved list.
This works, but it constrains what owners can do with their property and it depends on someone maintaining the list, which reintroduces a central point of control into an asset sold as self-sovereign.
Newer collections often sidestep the argument by taking a larger cut at the primary sale, or by attaching ongoing benefits that only holders registered with the creator can claim.
The episode showed where the rules actually live
Royalties were widely described as a property of NFTs, when they were in fact a property of the platforms most people used to trade them.
Anything not enforced by the token contract depends on the continued cooperation of intermediaries, and intermediaries cooperate for exactly as long as competition allows.
That is the general lesson beyond royalties: to know whether a feature holds under pressure, look at which contract enforces it rather than at which interface displays it.