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NFT Licensing Framework Introduced by A16z

An innovative Creative Commons-inspired solution has been proposed by VC firm A16z to address the problem of traditional legal systems being challenged by NFT Licensing.

As part of a free and public set of “Can’t Be Evil” Licenses, Andreessen Horowitz’ crypto arm, a16z, released six NFT-specific Creative Common’s like copyright licensing frameworks on Wednesday.

By offering a lawyer-vetted array of license options similar to Creative Commons, the firm wants to establish some industry standards for NFTs. Non-fungible tokens are surrounded by confusion over intellectual property rights.

With the rise of no-rights-reserved projects, a16z argues that owners need to clarify how their NFTs can be used and how to grant permissions.

Miles Jennings and Chris Dixon, a16z’s general counsel and managing partner, wrote a blog post in which they stated their firm aims to clear up the confusion and ambiguity surrounding NFT licensing.

License Templates

By democratising “access to high quality licenses” and encouraging “standardization across the web3 industry,” they aim to clarify the rights of NFT creators, buyers, and sellers.

The “Can’t Be Evil” set is intended for projects creating and selling NFTs to use as a template. The T&C’s can be found here.

Six options are offered to help creators protect or release their intellectual property rights, especially those that allow buyers to modify artwork or create derivatives.

NFT projects can reference any of the licenses on GitHub directly from their smart contract, thanks to a partnership between a16z and law firms Latham & Watkins LLP and DLA Piper LLP. 

Based on US law, the open source licenses apply only to copyrights, excluding other forms of intellectual property, such as personality rights, according to the document. Under US copyright laws, buyers of both traditional and digital assets are not automatically granted the right to reproduce or publicly display the artwork without a license.

According to a16z, the title “Can’t Be Evil” draws inspiration from Google’s “don’t be evil” slogan.

“Instead of trusting people or corporations to not be evil, we can ensure through code that they “can’t be evil,”

according to a16z. 

Moonbirds & Yuga Labs

Moonbirds, an NFT project whose founders rescinded its holders’ commercial art rights last month, has recently brought Creative Commons licensing issues into the spotlight.

Recently, CryptoPunks and Meebits, both owned by Yuga Labs, updated their terms and conditions to allow NFT holders to use the image of their NFT however they like, without seeking permission from Yuga Labs

A NFT is essentially a piece of code. In most cases, the actual image or artwork is stored off-chain on a remote server, while only the metadata is stored on-chain. (However Moonbirds did recently promise to store NFT art ‘in chain’.)

In the case of an NFT purchase and transfer, the purchaser does not receive the content file that is attached to the remote image, only the metadata. Hence, intellectual property rights for NFT’s have become a thorny issue.

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