NFTs are not a guarantee of ownership on the internet

NFTs have been at an impasse for a few months. In lack of buyers, it is their background system that is under fire from critics.

The NFT market is at an impasse. For a few months, non-fungible tokens have not been so popular. Some collections have reached incredibly low values, a first for NFTs since their inception. A new study today comes to push the NFT a little more. According to Galaxy Digital, an investment company around blockchain technologies, large NFT projects do not actually secure any property.

Non-fungible tokens exist because they are inviolable proof that a digital asset belongs to a person. At least on paper, this notion of ownership is very clear, and it is this that gives NFT its appeal.

But in reality, things are quite different. Galaxy Digital’s report reveals that only one of the 25 NFT projects studied attempts to give buyers direct intellectual property rights to the underlying art. All the others are satisfied with confused licenses, without clear legal basis.

The biggest projects are not the most serious

Among the projects studied and pinpointed by the report, we find the biggest names in the field. The Bored Ape Yacht Club (BAYC) project is notably headlining. It shares space with metaverse projects Decentraland and Sandbox. But according to the report, all of these companies “misled buyers”.

If today some projects have decided to use the Creative Commons standard, already widely used on the internet, it comes much too late, and the ownership of the work can be disputed. Earlier this year, Cornell University had already drawn the same assessment, by including cryptocurrencies in its report.

Two studies that clearly show “inconsistencies” in the operation and access to ownership of BAYC. Yuga Labs — which manages the NFTs in this collection — promises buyers that they will “own” the underlying art. But at the same time, it publishes a contradictory license.

In the end, Galaxy Digital’s report found good only in “World of Women (WoW)”, a collection that makes the “noble effort” to transfer the copyright of the creator of the work during each sale. If this license is not yet perfect, it is taken as an example by the report to show the line to follow for this small universe.

NFTs need to update

The report concludes by explaining that NFT collections need to make an effort on themselves before asking customers to come back in droves. Money is no longer as present as it was a few months ago, but NFTs have made their way into the collective imagination.

We must now reassure a disappointed public, and succeed in winning them back so that they return in numbers to OpenSea and other purchase-resale platforms.

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