💍Ensuring Compatibility with EIP-2981 in ERC1155 Contracts

In this tutorial, we’ll explore a common vulnerability found in the ERC1155 token standard related to NFT royalties. Specifically, we will address the issue of incomplete implementation of EIP-2981, the NFT Royalty Standard, which can lead to interoperability issues with marketplaces and platforms that enforce royalty payments.

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What is EIP-2981?

EIP-2981 is the NFT Royalty Standard, which allows NFT creators and holders to specify royalties that should be paid when an NFT is resold on secondary markets. This standard is essential for ensuring that creators can earn a portion of future sales, even if the token is transferred through external marketplaces.

When an NFT contract adheres to EIP-2981, it exposes a mechanism for querying the royalty amount that should be paid to the creator. This is done by implementing the royaltyInfo function, which returns the recipient’s address and the royalty amount based on the sale price.

In addition to implementing royaltyInfo, EIP-2981 requires contracts to declare their support for the royalty standard by exposing the correct interface ID in the supportsInterface function, as described in EIP-165: Standard Interface Detection.

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The Vulnerability: Missing EIP-2981 Interface Declaration

While many contracts successfully implement the royaltyInfo function from EIP-2981, they often fail to declare that they support the EIP-2981 interface. This can cause problems for external platforms like marketplaces, which rely on EIP-165 to detect whether a contract supports specific standards.

If an NFT contract fails to register the EIP-2981 interface ID in its supportsInterface function, the marketplace may not know that the contract supports royalties. As a result, royalties might not be paid to the creator, causing a loss of funds or rights for creators.

Example Vulnerability

A contract might implement the core royalty functionality but fail to declare its support for EIP-2981. For example:

function royaltyInfo(uint256 tokenId, uint256 salePrice)
    external
    view
    returns (address receiver, uint256 royaltyAmount)
{
    // Royalty logic implementation
}

However, if the supportsInterface function does not return true for the EIP-2981 interface ID (0x2a55205a), platforms will not know to invoke the royalty functionality.

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Impact of the Vulnerability

The impact of this vulnerability is significant for creators, marketplaces, and collectors:

1. Lost Royalties: If the royalty information is not detected, creators will not receive their fair share of future sales.

2. Marketplace Interoperability Issues: Marketplaces that rely on interface detection will not handle royalties correctly, leading to inconsistencies in royalty payments across different platforms.

3. Creator Rights Violations: Creators may lose out on income that they are legally or contractually entitled to.

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Mitigating the Vulnerability

To prevent this vulnerability, it’s essential to ensure that your contract correctly declares support for EIP-2981 using the EIP-165 standard. This can be done by modifying the supportsInterface function in your ERC1155 contract to include the EIP-2981 interface ID.

Step-by-Step Implementation

Here’s how to implement proper support for EIP-2981 royalties in an ERC1155 contract:

Step 1: Ensure the Contract Implements royaltyInfo

First, your contract should implement the royaltyInfo function as required by EIP-2981. This function takes the token ID and the sale price, and returns the royalty recipient and the amount of royalties that should be paid.

// EIP-2981 Royalty function
function royaltyInfo(uint256 tokenId, uint256 salePrice)
    external
    view
    returns (address receiver, uint256 royaltyAmount)
{
    // Assuming a fixed 5% royalty
    uint256 royalty = (salePrice * 500) / 10000;
    return (royaltyRecipient[tokenId], royalty);
}

Step 2: Update supportsInterface to Include EIP-2981

Next, you need to update the supportsInterface function to declare that your contract supports the EIP-2981 interface. The interface ID for EIP-2981 is 0x2a55205a.

// Implementing the supportsInterface function
function supportsInterface(bytes4 interfaceId) public view override returns (bool) {
    return super.supportsInterface(interfaceId) || interfaceId == 0x2a55205a; // EIP-2981 Interface ID
}

Step 3: Test the Implementation

Make sure to test your contract on different marketplaces to ensure that it correctly interacts with their royalty mechanisms. Use tools to check that royalties are being paid correctly upon secondary sales.

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Conclusion

Ensuring that your ERC1155 contracts properly support the EIP-2981 NFT Royalty Standard is crucial for maintaining fairness and creator rights in the NFT ecosystem. Without properly declaring support for EIP-2981 via EIP-165, your contract may fail to distribute royalties, leading to financial and legal issues.

By following the steps outlined in this tutorial, you can avoid this vulnerability and ensure that your contracts are fully compatible with the broader NFT marketplace ecosystem. Always verify that royalties are being calculated and paid as expected, and ensure full compliance with all relevant standards to safeguard the interests of creators and users alike.