An NFT’s royalty percentage and receive address may optionally be included in an NFT upon its minting. After the NFT has been minted, the royalty may never be modified. If an NFT includes a royalty, then every time the NFT is sold, the appropriate percentage of the sale will be paid to the royalty’s receive address (typically the address of the original artist). The amount paid both to the new owner, as well as the royalty address, will be clearly displayed within the Offer.
On other blockchains, royalties are paid at the discretion of the marketplace on which the NFT is custodied. If an NFT is custodied outside of any marketplace, then royalties are not possible. On Chia, however, the royalties are built directly into the NFT. While under-the-table transfers could still circumvent royalties, they would also introduce counterparty risk for both the buyer and seller. In order to transfer a Chia NFT in a trustless manner, royalties must be paid.