Etsy sellers are abandoning the marketplace over an influx of AI-generated listings and disclosure rules they say go unenforced, according to WIRED. A Boulder artist who cleared $40K on Etsy in 2021 selling custom pet watercolors watched sales drop 30% in 2022 and another 50% the following year as cheaper AI portraits climbed above her in search results, and a UK illustrator of 10 years reports a 98% sales decline over the past year. Etsy has permitted AI-generated art since 2024 provided sellers disclose it, and VP of customer operations James Ossman told WIRED that enforcement is complex and the company has more work to do. Fybe, a crafts marketplace banning AI content and dropshipping in favor of volunteer human moderation, opens to vendors on August 1.
