Royalties were presented as a defining feature of NFTs: creators would earn on every resale forever. The payment was always a marketplace convention rather than a property of the token.
The standard never carried an enforcement hook
The common token standard defines ownership and transfer. It contains no notion of a sale price, because a transfer function does not know whether money changed hands.
A royalty therefore cannot be deducted at the token level. There is nothing to deduct from and no price to calculate against.
What emerged instead was a metadata standard letting a contract state a royalty percentage, which marketplaces could read and choose to honour.
Marketplaces paid voluntarily while it suited them
Early venues enforced royalties because creators chose where to launch, and a marketplace that stiffed creators would not attract collections.
That alignment held while a small number of venues shared the market and each depended on creator goodwill for supply.
It stopped holding once trading volume concentrated in secondary markets, where the seller chooses the venue and the creator has no say.
Fee competition made the payment a disadvantage
A new marketplace could offer sellers better proceeds simply by making royalties optional, without changing anything else about its service.
Sellers responded to price as sellers do, and volume migrated. Venues that continued enforcing royalties found themselves competing against a structurally cheaper option.
The outcome was determined by the fact that royalties were never a right, only a norm, and norms do not survive a competitor that ignores them.
Contract-level enforcement is possible but costly
Creators can restrict transfers so tokens only move through approved contracts that pay royalties. This makes the payment enforceable at the token level.
The cost is that the asset becomes less freely transferable, which conflicts with the ownership claims that made NFTs interesting in the first place.
Allowlists also require ongoing maintenance, and a collection whose creator stops updating the list can find itself untradeable on newer venues.
The economics moved to the primary sale
With secondary income unreliable, creators shifted their expectations toward the initial mint, pricing it to cover the work rather than treating it as a foothold.
Some replaced royalties with ongoing benefits that require the creator's continued participation, so holders have a reason to want the creator funded.
Structuring value around something the creator actually controls has proved more durable than relying on a payment any venue can decline to collect.