Etsy
recently released its 2025 Transparency Report, giving sellers a
behind-the-scenes look at how the marketplace is handling policy violations,
intellectual property complaints, scams, and buyer protection. If you've been
wondering why so many shops have been suspended or why Etsy seems stricter than
ever, this report provides some answers.
The biggest
takeaway? Etsy is relying more than ever on automation and AI to monitor
listings, while also adding a few improvements to help honest sellers
understand and appeal decisions.
Let's look
at the most important points.
Etsy Is Bigger Than Ever
The numbers
are impressive:
- 87 million active buyers
- 5.6 million active sellers
- Over 100 million listings
With a
marketplace this large, Etsy simply can't review everything manually. Instead,
it now combines automated systems with human reviewers to detect policy
violations and suspicious activity.
AI Is Doing More of the Work
One of the
biggest changes is Etsy's increased use of AI-powered detection systems.
According to
the report:
- AI detection became about 10%
more accurate than the previous year.
- 98% of listing flags came from Etsy's own automated
systems.
- Only 2% came from users
reporting listings.
This means
that contrary to popular belief, most listings are not being removed
because competitors report them. Instead, Etsy's automated systems are
identifying potential problems first.
Intellectual Property Is Still the Biggest Risk
Copyright
and trademark issues remain one of the main reasons shops lose listings.
In 2025
Etsy:
- Processed around 111,000 IP
reports
- Removed approximately 846,000
listings
- Closed around 28,000 shops
for repeated infringement or counterfeit violations
The report
also reminds sellers that Etsy generally removes IP-infringing items after
the rights owner files a complaint. So while you may still see copyrighted
products on Etsy today, that doesn't mean they're allowed—it simply means they
haven't been reported yet.
Etsy Is Fighting Scammers More Aggressively
There's some
encouraging news.
Compared to
the previous year:
- Spam account removals increased
significantly.
- Scam messages dropped by 74%.
Most of the
accounts Etsy removed were fake accounts created for scams, such as fake order
notifications or phishing messages asking sellers to verify payment
information.
Even so,
it's still important to:
- Never click suspicious links in
emails.
- Always check your Etsy
dashboard directly.
- Be cautious with unexpected
messages about orders or payments.
Product Safety Matters Too
Etsy also
removed more than 50,000 products that potentially violated safety
rules.
These
included:
- Hazardous materials
- Dangerous products
- Items considered unsafe for
children
If you sell
products that fall into regulated categories, it's worth reviewing Etsy's
latest policies.
Most Customer Problems Never Become Cases
Another
interesting statistic:
About 92%
of order issues are resolved directly between buyers and sellers.
Only around 0.5%
of orders end up becoming official Etsy cases.
That's a
good reminder that excellent communication with customers is still one of the
best ways to protect your shop.
Etsy Is Improving Seller Tools
The report
wasn't all about enforcement.
Etsy also
introduced several improvements, including:
- A Policy Violations page inside
Shop Manager
- A listing appeals process for
certain policy decisions
- Better seller education through
updated policy guides
- Expanded Purchase Protection
for qualifying orders in 2026
These
changes suggest Etsy recognizes that sellers need more transparency when issues
occur.
What Sellers Should Do Right Now
If you sell
on Etsy, this report highlights a few best practices:
✔ Review your listings for copyright or trademark risks.
✔ Use accurate product photos.
✔ Clearly explain your role in creating, designing, or customizing products.
✔ Keep records of your design process whenever possible.
✔ Learn Etsy's current policies instead of relying on advice from years ago.
The more
automated Etsy becomes, the more important it is to make your listings easy for
both buyers and Etsy's systems to understand.
Final Thoughts
The Etsy of
2026 is very different from the Etsy many sellers joined years ago.
Automation,
AI, and stricter enforcement are now part of everyday life on the platform.
While this can be frustrating, especially when mistakes happen, it also means
honest sellers should focus on keeping their shops transparent, original, and
well-documented.
One lesson
stands out above everything else:
Never build
your entire business on a single platform.
Whether you
continue selling on Etsy, move to Payhip, Ko-fi, Gumroad, or diversify with
platforms like Benable, having multiple income streams gives you more stability
and peace of mind.
A
diversified business is often the strongest business.
