Non-fungible tokens or NFTs are sold on the promise of “ownership,” but a new review suggests many creators and buyers still have no idea what that means. A review from blockchain investment company Galaxy Digital finds that only one of the 25 most valuable NFT projects even tries to give buyers direct intellectual property rights to the underlying art, and many offer confusing or nebulous licenses despite recent efforts to clean up the space.
The Galaxy report analyzes the terms of major NFT projects, including the Yuga Labs project Bored Ape Yacht Club (BAYC), Gary Vaynerchuk’s VeeFriends, and World of Women as well as the “metaverse” social platforms Decentraland and Sandbox. It concludes that “the vast majority of NFTs convey zero intellectual property ownership of their underlying content,” and many of their operators (including Yuga Labs) “appear to have misled NFT purchasers” about the extent of their rights. Some projects have tried to prevent confusion by adopting the widely known Creative Commons license, but in the process, some have effectively untethered IP rights from the NFT — making it “impossible” for NFT holders to defend exclusive rights to the art.
