'I Want My NFT': Money for Nothing for Intellectual Property Rights in the Modern-Day Non-Fungible Token Transaction

Abstract

NFT makers are creating NFTs integrated with IP that are being purchased for exorbitant amounts. On the flip side, NFT purchasers are buying up NFTs for these high prices because they may think they are buying the underlying rights. This "Money for Nothing" problem - taking its name from the Dire Straits song - is what this paper terms as the "IP-NFT" Conundrum that explains the basic misunderstanding NFT consumers have about the IP rights (or lack thereof) they are acquiring when they acquire NFTs. Part I of this paper will focus on an overview of NFTs and the lack of IP rights associated with NFTs, or the “IP-NFT Conundrum”. This section will include a discussion of how NFTs are being defined with respect to a series of trademark cases, copyright law and patents, which is covered in other literature as well as forthcoming papers from the author. Part II will then outline the current marketplace of NFT trading platforms and the “Money for Nothing” problem that exists where a mismatch or imbalance is created between consumer understanding of what they are wanting to purchase from a NFT and what is actually really being purchased. Part III will finally discuss potential solutions to the “Money for Nothing” IP-NFT Conundrum problem – e.g., NFTs embedded with smart contracts that automatically embed IP rights upon sale, stronger educational initiatives involving NFTs, or the creation of platforms (or integration of rules and policies on existing platforms) that will facilitate the ideal transfer of IP rights for NFT transactions.