NFTs rarely offer intellectual property rights to underlying art, says report

NFTs make ownership details extremely clear. When a digital asset is purchased, details of the owner are coded into the token and stored permanently on the blockchain. Therefore, NFTs provide undisputed ownership of digital assets. However, when it comes to usage licences and intellectual property (IP) rights of the said digital asset, things get a bit blurry.

A report by Galaxy Digital found that among the top 25 most valuable NFT projects, only one collection tries to provide buyers with IP rights to the underlying art. The rest just confuse buyers and retain the right to change the usage licence for their NFT collections at any time. Confused? Tag along as we explain the usage and intellectual property aspects of an NFT.

To begin with, all NFTs offer usage licences, which can be split into four broad categories. These are commercial rights, limited commercial rights, personal use only, and creative commons zero. Let's understand each licence and how the various NFT collections approach them.