NFT: On April 26, World Intellectual Property Day (IP) is celebrated. IP is an important legal abstraction that comprises a series of rights related to the creation of the intellect and its protection through rules that provide for the protection, for example, of trademarks, copyrights, invention patents, geographical indications, among others.
The institute of intellectual property is alive and constantly impacted by technological advances in society, which can, at times, both assist and hinder authors in realizing their rights. Recently in the area of copyright, we have followed the challenges posed by the so-called “collaborative Web”, with the profusion of content being generated by Internet users, fostering an interesting remix culture, on an unprecedented scale, imposing important contrasts, reflections and legal interpretations. in relation to the current regulation.
Technological disruptions have accelerated in recent years, bringing sophisticated discussions precisely at the intersection of law and technology. An example of this is the recent advent of the so-called NFT – non-fungible tokens (or in Portuguese, “non-fungible tokens”), which has attracted attention for the values generated in virtual transactions and for having the ability to bring interesting possibilities in the cultural area.
In short, NFTs are like stamps of digital authenticity or digital certificates, which use blockchain technology – the same technology used by cryptocurrencies -, creating a digital technical scarcity. However, while cryptocurrencies are fungible, – that is, they can be replaced by other currencies of identical value -, NFTs are like “non-fungible crypto arts”, that is, unique, exclusive and irreplaceable.
Several artists, influencers and investors took the opportunity to recently create works in the NFT format, reaching surprising figures. Artist WhIsBe sold a 16-second animation of a NTF gold bear for $ 1 million at Nifty Gateway. Jack Dorsey, Twitter’s CEO, sold his first tweet as NFT for $ 2.9 million. The famous art of Nyan Cat, known as the flying kitten meme, was sold as NFT for 300 ETH, the equivalent today of more than $ 700,000. The artist Beeple sold his image collage art called “Everydays: the First 5000 Days” in NFT for $ 69.3 million at Christie’s, joining the list of one of the most expensive arts by a living artist ever sold.
NFTs support both the registration of immaterial goods, such as GIFs, tweets, memes, digital art works, music, among others, and the representation of material goods, such as paintings, automobiles, real estate, etc., making goods digitally unique and safely kept with their integrity and originality preserved.
When a person obtains an NFT on any of the assets listed above, he / she consequently holds the registration of ownership of this asset, related to property rights. This registration is carried out via blockchain – as mentioned above – by creating an exclusive digital signature. Thus, its falsification is impracticable, bringing a clear benefit from the point of view of intellectual protection, in addition to valuing property as a safer asset. Only that owner will be the effective owner of the original asset.
From the point of view of copyrights, NFTs appear as a new possibility for artists to increase their financial gains through the controlled sale of digital copies of their works. The NFTs allow a better management power over the works that are made available and commercialized in the virtual environment.
On the other hand, however, the risks are still present in this context. For example, there is a possibility of artificial inflation of the price of NFTs, which can be traded for exorbitant values between different cryptocurrency portfolios of the same individual, making their value (and the value of similar tokens) appear higher than it is in reality. One must also consider the fact that the development and maintenance of NFTs is not sustainable from an environmental point of view, due to the energy consumption required by them. Other risks related to NFTs are being mapped and must be closely observed by society and regulators.
Technological advances continue to generate significant changes in intellectual property, empowering creators, expanding the possibilities of consuming intellectual works and interacting with current regulations, in a complementary or, sometimes, challenging way. The fact is that technology disruptions require a careful, quick and careful look, and the valuable opportunities that arise from this scenario are already on the radar of artists, investors and consumers.