Table of Contents

• Introduction
• What Are NFT Royalties?
• How NFT Royalties Work Through Smart Contracts
• The State of Dubai’s NFT and Crypto Market
• Why NFT Royalties Matter for Artists, Creators, and Investors
• Legal Framework Governing NFT Royalties in Dubai
  • Virtual Assets Regulatory Authority (VARA)
  • DIFC Digital Assets Framework
  • Compliance Obligations for Marketplaces
• Secondary Market Rules for NFTs in Dubai
• Challenges in Enforcing NFT Royalties
• Emerging Solutions for Royalties Enforcement
• Case Studies and Global Comparisons
• Benefits of Enforcing NFT Royalties in Dubai
• How Websima Can Help Creators and Marketplaces
• FAQs
• Conclusion
• Websima

Introduction

Dubai has rapidly emerged as one of the world’s top NFT and Web3 hubs, driven by its proactive regulatory frameworks and booming digital asset market. According to the Chainalysis 2024 MENA Report, the UAE processed over $30 billion in on-chain crypto value between July 2023 and June 2024, ranking among the top economies in MENA and recording a 74% year-over-year growth in DeFi activity.

With NFT marketplaces thriving, NFT royalties — the automated payouts creators earn from secondary resales — have become central to Dubai’s Web3 ecosystem. But enforcement isn’t automatic everywhere, raising questions about legal compliance, smart contract enforcement, and secondary market rules.

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— Xaif Crypto| (@Xaif_Crypto) July 20, 2025

This guide breaks down NFT Royalties Dubai, exploring legal frameworks, market trends, and technology solutions shaping Dubai’s creator-driven NFT economy.

What Are NFT Royalties?

NFT royalties are creator payouts from secondary NFT resales. Embedded within a token’s smart contract, they ensure creators continue to earn whenever their work changes hands in the resale market.

Key features:

• Typical rates range from 5% to 10%.
• Payouts are automatically transferred to the creator’s wallet.
• Enforcement depends on marketplace integration and smart contract standards.

Example: An RWA NFT artwork in Dubai sold for AED 15,000 resells for AED 60,000. A 10% royalty embedded via the NFT smart contract ensures the creator receives AED 6,000 instantly.

How NFT Royalties Work Through Smart Contracts

NFT royalties rely on smart contracts programmed during minting to:

• Specify royalty percentage.
• Route automatic payouts to the creator’s wallet.
• Log all resale transactions on-chain for auditability.

However, marketplace-level integration determines enforcement:

• Some marketplaces, like OpenSea, recently moved to optional royalties, allowing sellers to bypass payouts.
• Others, like Magic Eden and Dubai’s Nifty Souq, enforce royalties on-chain, ensuring compliance.

For Dubai, where VARA-regulated secondary markets prioritize creator rights, enforcing royalties at the smart contract level is becoming the norm.

The State of Dubai’s NFT and Crypto Market

Dubai has established itself as a global leader in NFTs through strong regulatory oversight and Web3 investment:

• $30 billion in on-chain crypto flows were recorded in the UAE between July 2023 and June 2024 (Chainalysis MENA 2024 Report).
• DeFi adoption surged 74% YoY, supporting NFT-powered ecosystems.
• Initiatives like Dubai Design District’s NFT exhibitions and Emirates Airlines’ NFT loyalty program have mainstreamed NFTs.
• VARA’s pro-regulation stance has attracted global NFT creators and marketplaces to Dubai.

This growth necessitates robust frameworks for enforcing royalties and regulating secondary sales as well as a UAE-based NFT index to track digital assets trends.

Why NFT Royalties Matter for Artists, Creators, and Investors

Creators

• Sustains long-term income beyond initial sales.
• Incentivizes creators to mint higher-quality work.
• Protects against value dilution in resale markets.

Investors

• Encourages healthy NFT ecosystems with creator support.
• Drives higher asset valuations when creators remain involved.

Dubai’s Web3 Ecosystem

• Supports Dubai Vision 2031 by creating a creator-friendly digital economy.
• Strengthens global competitiveness by attracting artists and collectors worldwide.

Legal Framework Governing NFT Royalties in Dubai

1. Virtual Assets Regulatory Authority (VARA)

The Dubai Virtual Assets Regulatory Authority (VARA) sets NFT-specific compliance guidelines:

• Marketplaces must disclose royalty structures transparently.
• Smart contracts must comply with consumer protection laws.
• Resale platforms must maintain auditable logs for all transactions.

2. DIFC Digital Assets Framework

The Dubai International Financial Centre (DIFC) offers an alternative, common-law-based framework for NFTs:

• Recognizes NFTs as digital property.
• Enforces contractual royalty rights within DIFC jurisdiction.
• Facilitates dispute resolution between creators and marketplaces.

3. Marketplace Compliance Obligations

VARA-regulated NFT platforms in Dubai must:

• Embed royalty structures within user dashboards.
• Provide clear disclosures for both primary and secondary sales.
• Enforce AML/KYC standards for high-value NFTs exceeding AED 55,000.

Secondary Market Rules for NFTs in Dubai

Secondary NFT markets operating in Dubai are required to:

• Enforce royalties through smart contracts wherever technically feasible.
• Provide mandatory disclosures of royalty rates before resale.
• Maintain complete audit trails for all secondary transactions.
• Integrate AML-compliant wallet verification for high-value trades.

Challenges in Enforcing NFT Royalties

• Optional Royalties on Global Platforms: Platforms like OpenSea allow royalty bypassing.
• Off-Chain Transactions: OTC trades remain outside on-chain tracking.
• Cross-Jurisdiction Complexities: NFTs traded outside Dubai may not comply with VARA rules.

Emerging Solutions for Royalties Enforcement

1. On-Chain Enforcement

Dubai-based platforms like Nifty Souq integrate smart contract–level enforcement.

2. EIP-2981 and Global Standards

Ethereum’s EIP-2981 protocol defines a universal royalty standard, adopted by compliant platforms globally.

3. VARA’s Role

VARA is developing market-wide royalty enforcement mechanisms to ensure creator-first ecosystems.

Case Studies and Global Comparisons

Dubai: Nifty Souq

• Implements on-chain royalty enforcement.
• It has attracted 5,000+ artists across MENA since 2023.

Global Comparison

• OpenSea (US): Optional royalties → creator backlash.
• LINE NFT Marketplace (Japan): Mandatory on-chain royalties enforced by regulators.

Dubai’s clear frameworks give it a competitive edge over optional-compliance markets globally.

Benefits of Enforcing NFT Royalties in Dubai

How Websima Can Help Creators and Marketplaces

At Websima, we specialize in NFT marketplace development, smart contract design, and royalty compliance solutions:

• Create NFT platforms aligned with VARA’s rules.
• Develop smart contracts enforcing on-chain royalties.
• Build cross-chain solutions ensuring royalty enforcement globally.

FAQs

1. Are NFT royalties enforceable under Dubai law?

Yes, NFT royalties are enforceable if structured through smart contracts and compliant marketplaces regulated by VARA.

2. What’s the typical royalty rate in Dubai?

Most platforms default to 5–10%, though creators can customize rates.

3. How does Dubai’s approach compare globally?

Dubai’s regulatory clarity and VARA oversight make it one of the most creator-friendly jurisdictions worldwide.

4. How does Websima support NFT creators?

By providing custom smart contracts, marketplace infrastructure, and cross-border compliance integration.

Conclusion

With Dubai positioning itself as a global NFT hub, NFT Royalties Dubai are becoming critical to building a sustainable Web3 economy.
By combining:

• Smart contract enforcement,
• VARA’s regulatory frameworks, and
• creator-focused NFT marketplaces,

Dubai is shaping a transparent, compliant, and globally competitive NFT secondary market.

Websima: Your Partner in NFT Marketplace Development

At Websima, we empower creators, investors, and marketplaces to thrive in Dubai’s growing NFT ecosystem.

Our services include:

• NFT marketplace development aligned with VARA compliance.
• Smart contract integration with royalty enforcement.
• Cross-chain solutions for secondary market management.

Contact Us Today to build a compliant, creator-friendly NFT platform in Dubai.