Non-Fungible Tokens And Copyright: An Intersection

Avani Laad, Dhivya S & Shweta Yadav, Symbiosis Law School, Pune

ABSTRACT

Non-Fungible Tokens (‘NFTs’) have stolen the spotlight from blockchain technology and cryptocurrencies. In essence, it is a digitised token that depicts real life objects recorded on a blockchain. NFTs tie the digital world to the real world by the application of real-world assets which have value attributed in them. The other significant uses of NFTs are loyalty programs (such as air miles), digital rewards and stimulation of gaming experiences. They are also widely used as tokens to represent actual assets such as precious metals, cars, real estate, and even equity or bonds. The underlying assets are thus easily tradeable avoiding the challenges posed conventional markets as well as financial systems.

The authors, in the present research article, seek to study and analyse NFTs in a very particular and important legal aspect – copyright law. The fact that NFTs are largely based on an existing work makes it an interesting scope to study and understand the impacts of facets of copyright law. In the first section, the author seeks the ownership of NFTs in light of ownership of a copyright. Aspects such as what would a sale of NFT mean and value of the doctrine of first sale are dealt with in detail. The next section deals with concerns of copyright infringement and copyfraud. The paper also explores the use of smart contracts as a solution to the concerns that were discussed elaborately. The last segment focuses on the future of NFTs in reducing counterfeiting.