Let the NFT Self-Experiment begin!
Non-fungible tokens (NFTs) aren't new, in fact they've been around for years. However, it took the auction of an NFT linked to an image by Christie's Auction House and the fall of the hammer at a spectacular USD 69 million to create worldwide attention and interest in NFTs.
This has inspired many to rethink how this technology could be used. Not only in a wide variety of areas to solve problems, but also to create new business projects. Couldn't trademarks, designs, inventions or patents be transferred in this way with greater legal certainty and lower transaction costs? Wouldn't the same principle be applicable to physical objects such as machines, cars, or even real estate? What legal hurdles can be expected, and how could they be overcome?
It is precisely for such developments that we at Schoenherr have formed the IP & Technology Practice Group. Picking the brains of our specialists from various legal fields to provide well-founded answers on the subject of NFTs, we quickly decided to simply give this a try ourselves. In parallel, we analysed the legal intricacies stemming from our NFT self-experiment in the various relevant specialist areas.
In the coming weeks, we will report in detail on this self-experiment and the legal aspects from our NFT task force:
- Guido Kucsko, partner, is fortunately also present as an international conceptual artist. He created a digital artwork for this self-experiment.
- Alexander Pabst, associate and specialist in patent and copyright law, has a profound background in computer science. He immediately set up a wallet, formulated the smart contract and took care of the tokenisation of the artwork. He also provided technical support for the presentation of the NFT artwork on the OpenSea platform and the processing of the sale of the token to the DFC Francisco Carolinum Museum in Linz and will give insights into the technical aspects of the process.
- Anna Katharina Tipotsch, associate with a focus on (and passion for) art law, is coordinating the project and will discuss the copyright issues that arise, together with Alexander Pabst.
- Veronika Wolfbauer, counsel, and Peter Ocko, associate, have dedicated themselves to the complex issues surrounding transferring the NFT under general civil law and will analyse those in detail.
- Dominik Tyrybon, associate, will explore the question of how NFT transactions should be assessed from a regulatory perspective, particularly with regard to anti-money laundering provisions.
- Christian Schmelz, partner, will contribute to the energy law topic, especially since the environmentally impactful energy consumption of transactions in the blockchain is still considerable and also affects NFT projects.
- Dominik Hofmarcher, counsel, IP specialist, and in his spare time a musician, will deal with platforms that use NFTs as a new way of crowd funding for music production and will give insight into that.
- Constantin Benes, partner, specialises in real estate law. The fact that our NFT was bought by a museum and is now already presented in a newly established virtual branch of this museum, inspired him to analyse virtual real estate and give the legal perspective in that regard.
Our NFT self-experiment also led us to an intensive cooperation with a museum dedicated to media art. It has also shown us that this technology can be used in many cultural and economic areas. We will encounter it often in the years to come. And again it is evident that new technologies, new applications of technologies and new business ideas, cannot be judged in a unidimensional way. They always raise issues in many different legal fields and require a coordinated team of specialists. We were excited about this project and enjoyed the teamwork aspect of our NFT self-experiment. All the more reason for us to look forward to sharing the reports with you in Legal Insights which will be shared weekly.
Stay tuned and follow our NFT self-experiment: Keep an eye on our NFT blog article that will keep growing weekly. So, check your inbox often – there are fascinating regular legal insights to come!