this post was submitted on 18 Aug 2023
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Turns out that the smart contract is a post-it note stapled to the NFT and the marketplace can just ignore what the post-it note says because it's not legally binding.
What they can't do is trade with marketplaces that do enforce the contract. Originally it was enforced because if one marketplace stopped enforcing it the marketplace would be cut off from the Echo system but turns out that the 5 big marketplaces just need to agree to drop it and everything is fine.
There is no good design for this. The only design that works is external regulation and laws wich is why we use that for real things that aren't scams.
Nah the actual limitation is that providing people a way to transfer the token without paying a royalty is essential if you want to give people the option to freely transfer it between their wallets without selling it and paying a royalty. You could write a smart contract that does enforce this but then you would lose the ability to have that free transfer.