Non-Fungible Tokens: Transforming The Domains Of IPR And Digital Marketplace

Shradha Tomar & Prakhar Sharma, SVKM’s Narsee Monjee Institute of Management Studies (NMIMS), Indore

ABSTRACT

With the continuous evolution of technology, coupled with the advent of Metaverse, the world has stepped into a new digital era. The revolution in the field of information technology has given birth to digital representations of monetary value or rights known as crypto assets. The year is 2023, and an art-cum-digital phenomenon is sweeping various nations worldwide, known as Non-Fungible Tokens or NFTs. These NFTs have now become one of the most popular forms of crypto assets. However, their distinct features have led to the emergence of new legal questions in the field of law. Legal experts have tried their best to address the deadlock created by NFTs in reference to their legal status, however, their efforts have all gone in vain due to the unique and complicated nature of NFTs, that have features of both fractional ownership and fractional property rights. Furthermore, its conflict with Copyright Law has also given a major headache to the experts of law. Through this paper the authors aim to delve deeper into the critical issues regarding the legal status of NFTs. This paper first elaborates on NFTs, analyzing its different aspects such as the technology through which it is created, process of trading, unique features etc., and then discusses the legal aspects of these digital entities. Furthermore, the paper looks into various arguments pertaining to the nature of an NFT, along with addressing the conflict of NFTs with the concepts of ownership and property. This paper also traces in brief the recent developments pertaining to the field of virtual digital assets that took place in India, that will enable us to emphasize upon the fact that how urgently a regulatory mechanism on digital assets is required. At last, this paper analyzes the conflict of NFTs with intellectual property law, vis-a-vis the Indian Copyright Act, in the light of various judicial pronouncements across the globe that have attempted to resolve this enigma surrounding the NFTs.

Keywords: Non-Fungible Tokens, NFT, Crypto assets, Cryptocurrency, Virtual Digital Assets, Copyright, Intellectual Property, IPR laws