By Shani Merdler, VP Product, Minute Media
It was a watershed moment for nonfungible tokens (NFTs) when digital artist Beeple sold his NFT photo collage “Everyday: The First 5000 Days” for more than $69 million through a Christie’s auction this past spring. The piece was the first ever purely digital artwork sold by the renowned auction house and as a result, mainstream media coverage of NFTs exploded on everything from “Saturday Night Live” skits to headline news in the Wall Street Journal.
While much of the focus on NFTs has looked at the digital art space, NFTs are now being created and sold in a variety of forms expanding from the art world to sports, publishing, entertainment and beyond. Simply put NFTs are unique digital assets that live on a blockchain where ownership of that asset can be verified and authenticated and the NFTs transaction history can be viewed by the public, essentially cutting out any middle men. And while digital art like the GIF meme NyanCat may be one of the most well-known NFTs bought using Ether, a cryptocurrency, NFTs have taken on various forms from video clips, images, songs to yes, even tweets courtesy of Twitter’s CEO Jack Dorsey.
The sports world in particular has been all a buzz lately with record sales of NFTs. Whereas sports fans used to brag about their physical collectibles (e.g. a rare baseball card, an autographed football jersey) they now want bragging rights showcasing their digital ownership of an NFT. For example, LeBron James’ dunk shot against Nemanja Bjelica as a video clip on NBA’s Top Shot yielded more than $200,000. Or Patrick Mahomes launching “The Museum of Mahomes” with NFTs featuring digital artwork of him up for auction with a portion of proceeds going to his charity, 15 and the Mahomies Foundation. Just as rare physical collectibles demand high prices, the same can be said for NFTs- the more rare or unique an NFT is, the higher the price it can command. In the case of Mahomes, he combined NFTs along with signed autograph jerseys and sold them to the highest bidders in his auction. While individual athletes are venturing into the NFT market, smart sports leagues like the NBA are also getting a cut of the profit with the development of Top Shot.
While rare NFTs are soaring in value, opportunities abound for not only savvy investors who hope to watch the value of their NFTs accrue, but also those creating the content in all forms – video, written or image, can utilize NFTs to secure the copyrights for their piece.
NFTs could be the solution for the copyright issues that creators are experiencing today with people’s ability to duplicate any image, video or article that is being created and present it as their own. Even Google is unable to determine the source of an article and requires sites to point to the origin of the content using the Canonical URL tag, otherwise it punishes all sites using the content by degrading their location in the search results, also the site that is the true origin.
While NFT platforms allow the public to check the ownership, this is just the first piece of the technologies that will be created around it. Creators will have the need for platforms to enforce their ownership of the content in various ways. To start, there needs to be the capability to alert creators when their content is being used without permission across the web. Once they are notified, creators will have to decide how to act upon it – this is where the legal tech could kick in.
Because NFTs are still a nascent space, intellectual property lawyers are in demand to hash out everything from licensing to infringement issues. Case in point, DC Artist Jose Delbo who created Wonder Woman and sold a number of images as NFTs for close to $2 million. Since then DC Comics who owns the intellectual property of the Wonder Woman character has cracked down on artists selling their characters as NFTs and Delbo was forced to create a new original character for any future NFT sales. Imagine what it will require in order to do this at scale – demanding the right as well as signing agreements to allow the use of a certain content piece under certain conditions.
But it doesn’t stop there. As creators are more aware of their right to be compensated for the success of their makings, wherever they appear, platforms that offer an aggregated view of the performance and revenue that was generated from a content piece across social media and around the web will be in high demand. This will open the door for optimization services, analytic tools and potentially even create new types of roles, such as Assets Manager, that will be the biz-dev for the creator, in charge of maximizing the yield and revenue for the creator if machine learning will not solve this by then.
While NFTs are only the vehicle, they have the potential to unlock a future of empowerment to individual content creators that can tap into the blockchain technology used for NFTs to become more of an independent worker and remove the barriers that held them tied to larger organizations.