Intellectual Property Issues Arising From Nfts

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Intellectual Property Issues Arising From Nfts :

At the moment, non-fungible tokens (NFTs) are one of the most talked-about forms of intellectual property (IP). In addition to their traditional uses in marketing and the transfer of goods and services into the metaverse, NFTs can also be utilized as a novel asset class to attract investment. The proliferation of this new asset class across all industries presents interesting issues from intellectual property and NFT standpoint. In spite of non-fungible tokens’ proven utility in the modern digital age, little is known about them. Digital artwork, branded items, and logos are just a few examples of NFTs that might refer to or contain important intellectual property rights. Protecting and preserving people’s rights to their own ideas and creations should be a top priority for any initiative, including non-fungible tokens.

Understanding Intellectual Property And NFT

NFTs present companies with both potential and risks. On the one hand, there’s the opportunity of monetizing your company’s intellectual property rights, and on the other hand, there is the possibility that your company’s intellectual property rights will be misappropriated. First off, there are many different kinds of intellectual property rights, such as patents, copyrights, industrial designs, trademarks, trade secrets, geographical indications, etc., and each of these can be damaged in different ways. However, copyrights, trademarks, and patents are the three areas of IP that are most directly impacted by the minting and sale of NFTs.

Although NFTs have the potential to benefit businesses in many ways, there is also a risk that the intellectual property rights of a company or brand owner will be violated if someone were to mint unapproved NFTs without permission. There are two primary types of Intellectual Property and NFT infringement that may result from the unauthorized minting of an NFT pertaining to a digital asset. Infringement of the reproduction right is one of these (i.e., the restriction against reproducing or copying copyright works). Also, there is the violation of the right to communicate (i.e., the prohibition on communicating copyright works to a new audience not envisaged by the owner of the copyright).

A company or brand can keep tabs on its intellectual property and protect it by taking the necessary measures. For example, the company may already have watch notices in place, which it can then apply to key NFT marketplaces.


For companies or brands, certainly, Intellectual Property and NFT present a plethora of possibilities as well as risks. Nonetheless, for a company or brand to effectively manage its intellectual property (IP) and monetize it, the terms of sale of the Non-fungible token and/or the smart contract encoded in the NFT should make it clear what is and is not permitted with respect to IP rights. Third parties (including NFT purchasers) may use a company’s intellectual property (IP), so it is important to keep an eye on how they’re using it and take action if necessary. Clearly, there are a lot of obstacles to overcome, and it remains to be seen how the law develops.

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