Magic Eden launched on Solana in September 2021, founded by Zhuoxun Yin, Jack Lu, Sidney Zhang, and Zedd Yin. Within three months it was the dominant NFT marketplace on Solana, handling more than 90% of volume. At its peak in 2022, Magic Eden was valued at $1.6 billion in its Series B. It was one of the fastest-growing marketplaces in crypto history.
Then came the royalty wars. In October 2022, under pressure from professional traders who wanted lower fees, Magic Eden made creator royalties optional — a move that infuriated artists and communities who relied on royalty income. The backlash was brutal. Communities like DeGods publicly criticized the decision. Tensor, the trader-focused competitor, grew rapidly during this period. By early 2023, Magic Eden’s market share on Solana had cratered.
The comeback took time. Magic Eden reintroduced royalties, expanded to Ethereum, Polygon, Bitcoin Ordinals, and Base, and repositioned itself as a multi-chain retail marketplace rather than a Solana-only power tool. The ME token launched in December 2024 with a massive airdrop to users across all supported chains. The launch was chaotic — eligibility criteria sparked controversy — but by 2025 Magic Eden was back to being the largest NFT marketplace by user count, even if Tensor still dominated Solana trader volume.
The Magic Eden story is a lesson in the cost of trying to please your biggest customers. By catering to traders with the royalty change, Magic Eden briefly alienated the creators whose collections made the marketplace worth using at all. Getting both sides of a two-sided marketplace to trust you is hard. Losing one side’s trust can cost you the other. Magic Eden survived by admitting the mistake and rebuilding — but the scar from 2022 is still visible in its market share numbers.
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