Short
- A new Galaxy Digital research report claims that NFT project creators are falling short in granting IP rights to holders.
- It calls out Bored Ape Yacht Club and Moonbirds as projects that have “misled” buyers with potentially IP rights claims.
One of the most compelling selling points for some NFT There is the ability for projects holders to commercialize their avatars to create and sell derivative artwork, merchandise, and more. But a new report from Galaxy Digital shows that major NFT projects have “misled” buyers about what they are getting when it comes to IP rights.
released on Friday, “A Survey of NFT Licenses: Fact and Fiction” Examines the largest NFT projects based on implied market value today, particularly with regard to the rights they claim to confer on their holders. The report concludes that, in fact, “the vast majority of NFTs ascribe zero intellectual property ownership to their owners” — and it specifically highlights two projects that Galaxy researchers believe will help buyers. IP rights have been falsely marketed: Bored Apes Yacht Club and Moonbirds.
The report claimed that some NFT projects are much more permissive with their IPs than others. The bored apes of Yug Labs Arguably the most famous example of a project that grants holders a comprehensive license to use them Ethereum NFT images as they see fit. It has given birth to apparel, Marijuana packaging, music projectand also ape-themed fast food restaurant,
Other projects place constraints on commercialization, such as doodle, which the report notes limits the amount of income that can be generated from derivative works, as well as the ability to modify the original artwork. During this, Gary Vaynerchuk’s We Friends The project has a very limited “Personal Use Only” license that does not allow for user-generated commercial products.
There are also projects that fully adopt the open source philosophy, or creative commons zero (CC0) The “no rights reserved” approach allows anyone and everyone to create derivative projects using the artwork – not just NFT holders. the noun is sure most famous example ofwhereas moonbirds is about to switch to that kind of license,
However, even when an NFT project confers broad commercialization rights, Galaxy Digital’s report claims the language may be confusing or contradictory, or outright false. Alex Thorne, Head of Galaxy Digital Research decrypt That with such NFTs there is often a discrepancy between “what the public thinks they are buying and what they are actually buying”.
One NFT is a blockchain token which represents the ownership of something. profile picture collection like bored ape yacht club and cryptopunks Popular examples are, as well, the technology can be used for sports and entertainment collectibles, digital artwork, and video game items.
For example, in the case of Bored Ape Yacht Club, Yug Labs License Says that “when you buy an NFT, you own the completely boring app, The Art.” However, Era Labs is still the copyright holder that owns the intellectual property, and as such, Galaxy Digital writes that Era “implicitly acknowledges that the NFT holder does not, in fact, own the art.”
earlier this weekYuga Labs issued much longer and more comprehensive IP licensing agreements for cryptopunks And meebitsA couple of popular NFT projects that make it acquired earlier this year, Those agreements provide more clarity on the rights of NFT holders, but Noah Davis of Era Labs Told decrypt Last week That the bored app license will not be updated to match those licenses.
decrypt Galaxy Digital reached out to Era Labs for comment on the report and criticism of its Bored Ape Yacht Club licensing agreement, but did not hear back by the time of publication.
Meanwhile, reports follow moonbirds recently announced plan To adopt a CC0 license. Tech Entrepreneur Kevin Rose web3 Startup Proof launched the project earlier this year, and Moonbirds website wrote “You have an IP” when you buy Moonbirds NFT. Despite that claim, Proof said it would put Moonbirds in the public domain.
“The fact that Proof could unilaterally change the terms of its license, and did so, is further evidence that the holders of Moonbirds NFTs did not, in fact, ‘own the IP,’” the report read.
Kante described it decrypt As “a more serious case of discrepancy between marketing material and stated license” than something like Bored Ape Yacht Club. Several Moonbirds owners have expressed anger at the decision, with one claiming that a “six-figure licensing deal” is planned with the brand. CC0 fell after announcement,
FYI, soon after @moonbirds CC0 Announcement, I actually lost a 6 issue licensing deal I was working on for some time.
I understand the decision, but the team’s approach could have been better.
up and forward
See you all in Parliament later today!
— Lakoz.eth (🦍 ) (@Lakoz_) 5 August 2022
Evidence did not respond immediately decrypt’s request for comment About Galaxy Digital Report
The report further claimed that only one of the top 25 projects by market capitalization “even attempted” to actually grant IP rights to holders: women’s world, It notes that women’s world Most considerate is the licensing agreement that seeks to address the shortcomings of the others on the list—but it also has issues, particularly with regard to rights transfers after secondary market sales.
“Essentially, no NFT project is successfully transferring IP rights,” said Thorne. decrypt, “This is a big problem for the future” metaverse And also dramatically undermine that proposed dream of Web3, which is user-owned digital asset rights over this future version of the Internet,” he said.
Why so? Broadly speaking, Thorne suggested, this is because the NFT space is still nascent, and such commercialization rights initiatives only gained momentum last year. Some of these license agreements appear “amateur,” he said, and many projects simply take cues from one another. But as the NFT space matures, the license terms are expanding.
“The Boring Ape Yacht Club is a good example, because as they got bigger and bigger and they did” built their metaverseThese agreements have become clearer and clearer and more professional,” Thorne explained. decrypt,
Galaxy Digital’s report ultimately concludes that NFT owners need to fight for clarity on IP rights, and it is up to project creators to find ways to adopt genuine Web3 ownership, rather than simply grant licenses. Otherwise, it suggests, “the NFT landscape will clearly evolve into Web2 products that are marketed and disguised as Web3 products.”