This isn’t really a secret. When NFTs emerged as a coherent asset class in 2021, their value proposition was primarily one of rampant speculation. Since then, the NFT project has vast millions Attempting to shift the brand towards a more serious and sustainable future. Most have decided to go all in on a temporary and provocative concept of intellectual property (IP).
However, what exactly IP means in this context and to what extent NFT projects can grant IP rights to their holders have not yet been resolved. This week Yuga Labs billions of dollars The company behind Bored Ape Yacht Club—presentation They announced that they plan to grant exclusive commercial rights to holders of the acquired Ethereum NFT collection, Moonbirds. february.
There was just one problem with the plan. In 2022, the original creator of Moonbirds will submit the collection under Creative Commons 0 (CC0), a very firm legal tool that waives all copyright claims to Moonbirds NFT works, and place the pixelated owl characters in the public domain.
The Moonbirds’ official statement on the matter, posted Monday, seemed like an attempt to avoid this reality. ““If you made something in the CC0 era, cool,” the company said. wrote. “But from now on, if you want to keep doing that, you have to own a Moonbird.”
Twitter users immediately protested. Some, including copyright lawyer Alfred Steiner, argued that the company’s position was legally invalid. Moonbirds are now in the public domain and nothing can put the toothpaste back in the tube.
I see no way to interpret this other than to say it was something the public was free to do. @Moonbird Now you have to own Moonbird to create art, but of course this is false.
— Alfred Steiner (@alfredsteiner) April 30, 2024
It wasn’t long before oil prices began to adjust their positions. Within hours of the initial announcement, Greg “Garga” Solano, the company’s co-founder and CEO. wrote Commercial rights related to Moonbirds will only be granted to new 3D versions of Moonbirds artwork and will only be available to current NFT holders.
These commercial rights will be similar to those enjoyed by Bored Ape Yacht Club NFT holders, Solano said. For many years, Yuga has allowed BAYC holders to create and sell Bored Ape themed artwork, including: burger restaurant and canned water company. This meant that Moonbirds-themed chocolate bars and plush stuffed animals may soon appear, but only current NFT holders will be able to create them.
So what is the truth? Is anyone free to infringe on the Moonbirds copyright until the end of time? Or does Yuga have the power to control who creates Moonbirds-themed merchandise?
you’re right. Newly updated artwork has similar commercial rights to BAYC/MAYC, etc.
Old art doesn’t disappear. Think of it like the way DeGods and others have provided new versions along the way.
— Garga.eth(Greg Solano) 🍌(@CryptoGarga) April 29, 2024
According to Brian Frye, a law professor at the University of Kentucky who specializes in NFTs and intellectual property, both statements could be true at the same time. This fact exposes a major problem with how IP is currently understood and discussed within cryptocurrencies.
For Frye, it all comes down to the crucial difference between copyright and trademark rights. When Yuga says that holders of a Bored Ape or Moonbirds NFT have special commercial rights, the company is implying that their provenance comes from the individual NFT copyrights.
Copyright protects the content of a work, such as the plot of a book or the unique characteristics of an illustration. Therefore, Yuga argues that each of Bored Ape or Moonbird owns its own copyrights, and that the owners can exercise them for their own benefit.
But Frye and other legal scholars Alfred Steiner—Bored Ape Don’t believe that commercial experiments like burger joints actually rely on copyright. Instead, Frye claims he is leveraging the generic Bored Ape brand, which falls under trademark law. Simply put: People are lining up for Bored Ape burgers because they are affiliated with the Bored Ape Yacht Club brand. Not because it depicts a Bored Ape. #6184 Specifically.
The distinction is a double-edged sword. In the case of the Moonbird controversy, this means that oil prices are likely to be the cause. ~can do Police commercially exploiting the Moonbirds brand. But this also means that the whole concept of individualized, copyright-based commercial rights controlled by NFT holders is somewhat illusory.
In fact, all they are saying is that oil prices will be selected selectively. ~ no We are suing the current NFT holder for trademark infringement. However, there is little that can protect those holders if the company changes its mind.
Meanwhile, the original Moonbirds submitted under CC0 will remain in the public domain. However, the CC0 distinction does not grant any rights to the Moonbirds trademark. Any average person trying to open a Moonbirds ice cream shop in the near future will face challenges. legal boardingWhen you get a stern phone call from Yuga’s lawyer.
decryption We reached out to Yuga Labs several times for this story, but did not receive a response.
For Frye, the Moonbirds episode shows how much IP has become a buzzword and added value to NFT brands, despite the lack of legal clarity surrounding the topic.
“There’s a certain subset of (Yuga’s) customers who are really obsessed with the idea that IP is important,” Frye said. decryption. “They don’t even know what it means. But it’s a talisman: ‘IP! I want to own the IP, whatever it is.’”
In fact, in the hours after Yuga announced this week’s Moonbirds, the collection’s floor price (the price of the cheapest listed NFT on the market) soared nearly 30%. NFT price floor.
But short-term victories can be terrible victories. Since NFT prices plummeted during the cryptocurrency winter of 2022, Yuga has struggled to find a way to regain the cultural dominance it once enjoyed. At one point it cost nearly $430,000 to join BAYC in April 2022, when the project was at its peak. For now I just $42,000.
I was doing that last week announce Yuga has just experienced a wave of layoffs, CEO Greg Solano said, saying the company has “lost its way.”
The point of this week’s announcement is that a more active crackdown on the Moonbirds trademark could temporarily increase owners’ awareness of the Yuga’s value. It may already have been that way. But in the long run, self-limiting who can engage with the Moonbirds brand could be counterproductive in the cryptocurrency market, says Frye.
“One thing they strive for is goodwill with their customers,” Frye said. “And now to come back and say, ‘Anyway, we’re going to try to get our intellectual property back, which is mostly just an illusion,’ seems like an incredible ‘L’ to them.”
Editor: Andrew Hayward