Introduction
Component Royalties are an on-ledger, protocol-native mechanism that allows developers to earn recurring XRD revenue every time a transaction interacts with their deployed Blueprints or Components. Unlike grant programs or one-time funding, royalties scale with ecosystem usage and are enforced by the protocol itself.
This creates a sustainable developer incentive system where building widely-used infrastructure is directly rewarded — every piece of code that contributes to a transaction can earn its share.
How Royalties Work
Developers set royalty amounts on individual functions (Blueprint-level) and methods (Component-level). Royalties are charged as part of the transaction fee whenever that function or method is called.
Royalties can be denominated in:
- XRD — a fixed amount per call (e.g., 1 XRD)
- Approximate USD — a dollar-equivalent amount (e.g., $0.05 per call), where the protocol uses a constant multiplier to convert USD to XRD at execution time
- Free — no royalty charged
A single DeFi transaction that involves multiple Components — say a DEX, a lending pool, and an oracle — pays royalties to each Component's developer. Revenue grows linearly with transaction volume.
Mutability & Trust
Royalties can be marked as locked (immutable forever) or updatable (the developer can change or later lock them). Locked royalties provide certainty to users and integrators that fees will not increase. Updatable royalties may discourage usage, since the developer could raise fees unpredictably.
This opt-in model means developers must balance revenue aspirations against user trust — locking royalties at launch signals commitment, while keeping them updatable provides flexibility.
External Links
- Using Royalties — Radix Documentation
- Developer Royalties System — Radix Knowledge Base
- On-Ledger Recurring Developer Revenue — Radix Medium
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