NFTs are original digital assets that represent a certificate, which are becoming very popular among artists, influencers and even sports franchises, which use them to monetize their works or digital goods.
Cryptoart constitutes a new creative aspect, focused on the production of digital works of art that are distributed globally in a free market that, moreover, does not need the intervention of intermediaries for its proper functioning. All this, thanks to blockchain technology.
Blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system. A blockchain is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain.
What are the NFTs (Non-Fungible Tokens) ?
The crypto art is sold through NFT (Non-Fungible Tokens).
Non-Fungible means that it’s unique and can’t be replaced with something else. For example, a bitcoin is fungible — trade one for another bitcoin, and you’ll have exactly the same thing. A one-of-a-kind trading card, however, is non-fungible. If you traded it for a different card, you’d have something completely different.
These non-fungible Tokens are representations in digital format of an artistic work, which is incorporated into the blockchain, through a smart contract.
The incorporation to the NTF blockchain provides added value, since the blockchain system certifies the authorship, authenticity and originality of the token of the incorporated artwork, by means of encrypted and unchangeable data that make it a unique piece of work.
NFTs are characterized by being:
- Unique: these assets have many analogies with works of art, but here the owner can digitally certify that he is the sole and true owner of the original work.
- Indivisible: NFTs cannot be divided into smaller parts, and have all the value as a complete entity or token.
- Indestructible: the data in an NFT is stored through a smart contract, which means that it cannot be destroyed, deleted or replicated.
- Verifiable: there is a history of who has bought or sold an NFT and who its current (absolute) owner is, including the original creator from whom that digital asset was purchased in the first place.
Can all types of crypto art be sold as an NFT?
Yes, everything can be sold, from a photo, image, video, meme, GIF, etc. You can even sell the rights to a soccer player's jersey or a theater ticket, as long as this is legally validated.
How can I protect my rights as the author of an original work?
Most legislations, attribute to authors the exclusive exercise of the rights to exploit their works, regardless of the way in which such exploitation occurs.
Therefore, anyone who intends to profit from the sale of an NFT through the blockchain, must previously acquire from the author, the corresponding rights to carry out said exploitation of the work in accordance with the law and without incurring in violations of the rights of third parties.
How can Intellectual Property Rights be assigned?
The authors of the tokenized digital works are the ones who can directly assign the Intellectual Property rights through a license as long as the legal regulations are respected.
Do these transactions have legal implications?
Some of the most delicate points of the NFTs within the legal field is Intellectual or Industrial Property.
Why? Because when you are coining an NFT you are uploading a work legally protected by Copyright to a database called blockchain and with this a proof is generated that verifies that you have made a copy, that you uploaded it and then you publicly communicated the copy.
Therefore, and as the first challenge of Intellectual Property, there is a risk that this technology brings with it a violation of Copyright when people who do not have those rights to carry out the NFTs upload, copy, upload and publish the content.