NFTs as Negotiable Instruments: Croatian and EU Perspectives

Abstract

Non-fungible tokens (NFTs) are a technology most often linked to art and collectibles, yet their potential and possibilities extend far beyond these domains. A sizeable group of scholars believes that NFTs represent the future of web3, largely due to their ability to certify and preserve uniqueness and non-fungibility in an online environment where almost everything can typically be copied without limit. Given the current scope of the NFT market and its potential for growth, these tokens should be contemplated and regulated within forthcoming web3 legislation. One particularly important area where NFTs intersect with the legal framework is contract law. There has already been some progress in this field, and this paper focuses on developments from the Croatian perspective. The concept of tokenization, frequently associated with nonfungible tokens, is reminiscent of an older phenomenon: the negotiable instrument, which is effectively a document embodying certain individual right, that can be transferred from one individual to another. My argument is that NFTs qualify as negotiable instruments (Cro. vrijednosni papiri) because their characteristics align with the legal requirements for such instruments. Moreover, I argue that NFTs can be seamlessly incorporated into the existing legal system under the current definition of negotiable instruments.