As the popularity of NFT continues to grow, more and more people are buying and selling these unique digital assets on various platforms. However, as with any online transaction, there are important privacy considerations to keep in mind. It is important that NFT buyers and sellers understand how their personal information is collected, used and shared by the platforms they use.
The registration process on the platforms may vary and require additional verification by the registrant. The Foundation, for example, requires sellers to verify their account before they can sell NFTs, while OpenSea and Rarible do not have a verification process.
On 28th February 2023, the European Commission has sent a Statement of Objections to Apple about its concern on the contractual restrictions that Apple imposed on app developers on music streaming providers. Specifically, on the contractual restrictions which prevent them from informing iPhone and iPad users of alternative music subscription options at lower prices outside of the app and to effectively choose those. The Commission thinks that this performance violates EU’s law because Apple’s anti-steering obligations are unfair trading conditions in breach of Article 102 of the TFEU (Treaty on the Functioning of the European Union).
NFTs is not only related to intellectual property law. Of course, intellectual property law plays an important role in this aspect, but NFTs can refer to other areas of law, which are mainly national laws. Examples of such areas of law include: contract law, property law, tax law and in some cases also banking law and finally also the aforementioned intellectual property law.
At the beginning, there should be asked the question of what legally NFT is or what rights the possession of NFT provides. Everything in principle depends on the smart contract and other contractual frameworks related to NFT. From the technical side, NFT consists primarily of a number (tokenID) and an alphanumeric code (smart contract address code) that is somehow associated with a digital file or physical asset. The buyer of such a token first acquires the right to hold NFT in his wallet and to sell the token. In addition to the above-mentioned rights, the buyer may also acquire ownership rights to the underlying assets, an exclusive license or a limited license relating to the underlying assets. In view of the above, it can be concluded that the nature of NFT is non-uniform.
Non-fungible token (hereinafter referred to as NFT), it is a unit of data stored in a distributed data register, known as a block chain (blockchain), thanks to which a digital asset is unique and therefore non-tradable. A blockchain NFT file does not itself contain an actual digital artwork, video clip, or music. It should be thought of more as a contract that can be represented like this: “Mr. B owns file Y”. Therefore, NFT can be used successfully as a personal digital event ticket. The story of NFT was born with the publication by Yoni Assia article on “Coloured Coins” (Coloured Coins), which consist of small denomination bitcoins used to represent various assets, i.e. real estate, shares, subscriptions or works of art. It can include both tangible and intangible real estate. The main difference between NFT and cryptocurrencies is that while cryptocurrencies such as Bitcoin are fungible, NFT is as a principle immutable. The primary purpose of NFT is to provide an authentic record of an asset. It can therefore be concluded that free access to such a token may generate little or no value. This theory, however, was disproved by Jack Dorsey, who generated over $2.9 billion after posting his first ever tweet. Therefore, there is some risk associated with NFT, as further development of the token may contribute to the idea of copyright originality being considered useless.
The arrival of NFT on the market has started to cause some new copyright problems. In national courts, we can more and more often encounter court proceedings regarding infringements of NFT copyrights. One of the more interesting examples of the importance of copyright in the context of NFT is Quentin Tarantino’s NFT. At the end of 2021, he announced that he would “mint” seven iconic scenes from the movie “Pulp Fiction” in the form of NFT. Each such NFT consists of digitized chapters from the original handwritten script, as well as unreleased scenes and Quentin Tarantino’s personalized audio commentary. The film studio Miramax, to which Tarantino sold most of the rights to the film, became interested in the case. However, the director retained the rights to the script. Miramax studio filed a lawsuit for infringement of their copyright because they decided that yes, Tarantino owns the rights to the script, but that NFT will use the brand owned by the studio, so it should benefit financially from the tokens. Currently, the case has calmed down a bit, because the parties agreed to a compromise in a private meeting and testified in court that they wanted to focus on cooperation and joint creation of NFT, unfortunately the terms of such a settlement were not disclosed.