Large NFT Initiatives Misled Consumers Over IP Rights

Large NFT Initiatives Misled Consumers Over IP Rights
  • The report “A Survey of NFT Licenses: Facts & Fictions,” came out on Friday.
  • Other programs that impose commercialization hurdles include Doodles.

The opportunity to make money off of one’s avatar by making derivative works of art, merchandising, and more is a major selling factor for certain NFT initiatives. However, a recent investigation by Galaxy Digital reveals that large NFT initiatives have “misled” consumers about what they are really acquiring in terms of their IP rights.

The report “A Survey of NFT Licenses: Facts & Fictions,” which came out on Friday, analyses the current major NFT projects based on inferred market worth, specifically with respect to the rights they claim to confer on their holders.

Improper IP Rights Advertised

The article does state that the “vast majority of NFTs convey zero intellectual property ownership” to their owners and singles out the Bored Ape Yacht Club and Moonbirds as two projects that researchers at Galaxy think improperly advertised IP rights to consumers.

The analysis suggests that certain NFT initiatives are far more liberal with their IP than others. Perhaps the most well-known example of a project that grants holders extensive permission to use their Ethereum NFT images as they see appropriate is Yuga Labs’ Bored Apes. 

Other programs that impose commercialization hurdles include Doodles, which the research states restrict the ability to change the original artwork and limits the amount of cash that can be earned from derivative works.

There are other initiatives that take a “no rights reserved,” or Creative Commons Zero (CC0), stance, allowing anybody to use the artwork in their own derivative works, not simply those with a valid NFT. Perhaps the most well-known instance of this is Nouns, and Moonbirds will soon adopt this license.

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