Legal procedures allow easy access to NFT digital art

THE T.V,In other words, the use of non-fungible tokens in the world of art and culture is in full swing.

While the general public focuses on the best and happiest NFT markets, they are unaware of the legitimate risks behind these models.

Have you ever heard of something like this?

DC 'Wonder Woman' artist Jose Delvaux has been warned after receiving a letter from a DC lawyer for a lawsuit alleging the unauthorized publication of NFT digital artwork as Wonder Woman images.

American rapper Jay-Z has sued the sellers of RAF Records on his behalf, prohibiting the owners of RAF Records from attempting to change the NFT technology of the Jay-Z members' music album.

Quentin Tarantino, director of the classic Hollywood film "Pulp Fiction", has been sued by producer Miramax for conspiring to distribute NFT digital works related to the film.

Although the above situation has occurred in the United States, global interest in NFT has led to conflicts in many countries and regions, and many issues need to be addressed further by police and administration. .

However, following the fire, some legal agreements have yet to be concluded and legal disputes relating to the above issues remain to be resolved.

The content of this article presents the main points for avoiding the legal risks associated with the production, sale and distribution of NFT graphics to sellers and customers through the use of coastal examples in conjunction with current developments on the market. international market for NFTs.

To help the reader understand, the information in this sentence is correct.sellerA legal person or artist who broadcasts NFTs indoors or broadcasts NFTs to a third party and distributes NFT works of art to the public. andthe residentMeans that a trader is purchasing NFT digital artwork on the NFT trading platform.

What is NFT?

awareness

The name NFT is confusing to professionals. The most common understanding is that NFTs are unique, immutable data stored on a blockchain.

Depending on its characteristics, NFTs can interact with easy-to-grip digital devices such as music, graphics, games, etc., and their function is “digital certification”.

Thanks to NFTs, the problem of anonymity and ease of interaction with digital assets is solved, when all markets are closed, making all trading more flexible and open. And smart contracts (smart contracts) enable providers of digital NFT businesses to generate additional revenue.

NFTs are developed by keystroke on the blockchain, typically using the Ethereum ERC-721 technology output model, and typically having at least special characters, metadata, and smart contracts.

legal

Are NFTs a virtual product, a virtual product or a security?

This is directly related to NFT surveillance in many countries and customer legal protections. Section 127 of the “Civil Law” states: “If the law provides for the protection of data and network property, please comply with these laws. "However, there are no legal specifications for DFTs in Greater China.

In the United States, an important finding is that the Howey test is still needed to determine if NFT is safe. separated accordingly"Stocker", NFT issuers and NFT trading platforms must strictly adhere to the requirements of the United States Securities and Exchange Commission (SEC) and follow detailed listing and disclosure procedures.

In addition, this industry is also strictly limited to revenue from smart contracts.

Although the NFT is not a security, it can still be recognized as a "commodity" within the meaning of the "Commodity Trading Act" if the NFT is eligible for secondary marketing and commercialization. The U.S. Commodity Futures Market (CFTC) considers Bitcoin and, like all other significant non-securities digital assets, to be commodities exposed to the CFTC to prevent fraud and fraud against the law.

As a seller and buyer of NFT digital artwork, you need to be extra careful.New laws and regulations governing many countries to avoid risks or downgrading of investment objectives.

NFT and digital art are two treasures.

Charts connected to NFTs are different tools. The difference with NFTs is that the connected graphics are usually not stored on the blockchain because the cost of storing the blockchain is very high.

When a customer purchases an NFT chart, they receive a link in the NFT, which points to a repository for charts, such as the URL of the third page.

We understand that NFT and its digital graphics are independent of each other, and both sides of the exchange need a clear understanding of business concepts.

Despite the legalization of NFT, most of the industry remains digital art.

Buyers are likely to call whatever seems appropriate, if there are only a few.

1)Obtain any rights or licenses to sell artwork through NFTs.

2)It is true what rights the buyer received after the purchase (for example, the legal terms of the smart contract or the description of the goods).

Can I sell NFT digital artwork?

Unlike the NFTs developed by Mint, the graphics rules attached to them are more complex.

Current types of NFT digital art industry include music, graphics, popular signage, dynamic maps (NBA Topshot), tweets, etc.

Please noteThe NFT art industry continues to comply with applicable laws and regulations regarding legal, portrait and contractual obligations.

If the brokerage firm wanted to sell its own digital NFT services created by digital artists, traditional business contracts would not include crypto technologies like NFTs, according to the newspaper. Therefore, the contract should be revised in a timely manner, the Royal Rights Portrait should be allowed to sell NFT digital art, and commercial income from drawing NFT images should be considered income.

for artists,Even if you are selling a work created by yourself, you need to know if you have the right to sell, for example by hiring or hiring someone to create the work, and review the project licenses on time. The path.

DC cartoonist Jose Delvaux has been making comics for "Wonder Woman" since 1976. In March of that year, Jose made a total of $ 1.85 million while collaborating with other actors on the Wonder Woman NFT movie . After DC learned of the existence of the NFT industry, the Justice Department immediately sent a notice to all employees, prohibiting DC Comics artists from selling DC Universe or other NFT-related digital images without permission. .

In the case of companies such as DC or Marvel, when a designer engages in a project, the company enters into a Work for Hire contract under which all rights reserved, including animations and unique images, belong to the company.

For the customers,Because NFT charts cannot be done honestly, analysis of the vendor's “reasonable sales” is a must.

By comparing the sales of NFT graphics to the built-in devices and the secondary activity of the holders to the connection, NFT technology can ensure that the product market in the unbound link and data exchange can be tracked. , but there is no guarantee that there will be no legal issues in the manufacturing process.

If the seller does not have the legal authority to distribute these digital images, the buyer is responsible for investing at his own risk.

Well-known NFT trading platform Rarible this year received a letter from law firm Marvel asking them to remove Spider-Man artwork for sale for $ 5,500 on the platform. Following receipt of this notice, Rarible immediately decided to ban customers who had paid $ 5,500 by selling the services they currently have on the blockchain. Buyers can now not view digital images of Spider-Man purchased from the crypto wallet on the Rarible website.

How to write a "sales contract"?

When it comes to the commercialization of these digital arts, the legitimate benefits are a change in ownership or license rights.

Membership:That is, the special right to own, use and dispose of certain items.

Copyright clearance:According to intellectual property, these are the rules that generally include the rights of creation, distribution, modification and translation.

when you become a member, then according to the “first sales law” of US law (also called the “law of operations” in Mainland China), the insurer has no control over the exchange of multiple copies of a company. Parties who are legally authorized to sell, distribute, etc., may themselves decide to resell copies of their work.

If you have permission restrictions, the above principles do not apply and the license rights that the buyer ultimately obtains are all part of the seller's contract.

love love,You must obtain the members of the digital art form before the buyer can obtain the rights to sell.

Unlike traditional products, buyers and sellers can discuss terms and conditions together. Due to the uniqueness of NFTs, these contracts are usually drafted by the seller in advance and are defined as part of a smart contract or directly to the buyer in the terms of the product description.

If the contract is misunderstood due to the buyer's negligence or blindness, it can lead to the investment target (such as misunderstanding their resale rights).

The authors examined several “sales contracts” advertised in the NFT market and found that the contracts were different. For example, music sold on the Zora platform by Linkin Park member Mike Shinoda in a public contest "only permits self-restraint, not commercial use and resale rights by NFT. , and you may not authorize, trade, develop, distribute, derive, public service or public relations plans. authorization. "

Christie's auction contract for NFT art is over 30 pages long and is more of a risk note. I understand the implications of the law.

The contract is usable

For example, Clonex series sold by RTFKT studio on the Rarible platform, the sales contract for this series is published in the product description, and the buyer can click Link to see all the general conditions of the contract.

In addition, the sales contract for the NFT creative series 'Pepsi Microphone Drop' released by Pepsi-Cola Company can be seen in the smart contract. Below are some examples of PepsiCo terms and conditions.

Acceptance of the Content or the NFT does not authorize or endorse any licensee, licensee or title of the Content other than as set forth herein.

Unless stated otherwise herein, receipt of such digital works or NFT does not authorize or acknowledge the licensee, licensee, or participant in the digital works.

The copyright owner retains all rights to the content (including compliance with the law, trademark, name, image, art, design, art and / or of any other exclusive property). allow the person to get approval here.

The copyright owner retains all rights (including legal, trademark, name, image, graphics, art, design, art and / or other proprietary rights) on this digital work without authorization of the rights to the recipient.

... The beneficiaries of this NFT have the right to restrict, revoke, exclude, not modify, access non-sublicensable licenses, use, display, publish and publish the Language and NFT terms here. The recipient is a member of this NFT; (ii) Self-service and non-commercial use; and ...

... the recipient of this NFT has the right to restrict, revoke, exclude, not modify, the non-sublicensable license to access, use, view, publish and publish the material digital and NFT no. How long has the client had this NFT; (ii) Personal and non-commercial use ...

In accordance with the above rules, the author notifies the seller when signing the sales contract:

1,Words should distinguish between NFTs and digital graphics, so don't confuse them with tools or policies.

2,It is clearly stated that the buyer has acquired the members on a copy of the digital works or has obtained a license to exploit the digital works.

Three,If there is a license restriction, you must specify the types of rights under the copyright license and the rights restrictions (such as personal and non-commercial copying).

The closing contract must include the terms and conditions, such as liability for breach of contract, law enforcement, and dispute resolution (the PepsiCo agreement mentioned above states that state law of New York applies).

Now, since most of the high market value NFT digital works are sold in foreign NFT markets, the seller of the contract is in English and used for the foreign customs code, so the buyer has high legal knowledge.

approved by the author,For an expensive NFT digital art business, you don't have to speculate on a sales contract, frequently seek help, and assess the right business model and investment risk.

system

We believe that the expansion of the NFT digital art business will increase oil prices and exchange rates, and the trading platform can benefit the most.

The seller and the buyer should be aware of these standards, pay particular attention to the environmental regulations of different countries, and ensure that they do not become "interference" by defending their rights and interests in accordance with the laws and regulations in force. force. . Pare due to negligence.