How NFTs protect artist?

Reality Check
24 April, 2021 by
How NFTs protect artist?
James Huang

How NFTs protect artist?

The idea behind NFTs enabling artists to exercise control over their work, to more easily sell it, to more strongly protect against others appropriating it without permission.  It helps to provenance, ownership, distribution, and control of artworks. 

The growth of NFTs in art has been fuelled by its unique attributes. NFTs can allow artists to better monetize their work by selling NFTs directly online without middlemen. And unlike the traditional art market, artists may benefit from the rise in value of their work by incorporating commission requirements in the smart contracts that accompany NFTs.

Some hope that NFTs will open up a new revenue source for artists, including underrepresented artists, either by allowing artists who traditionally do not sell in galleries to sell directly to buyers online, or by allowing artists to sell something in addition to their tangible works. For example, an artist could sell an NFT of the digital image of a painting or sculpture to one buyer, while selling the physical work to another buyer, allowing the artist an additional opportunity to profit from the work.

NFT and IP

However, NFT's usefulness when it comes to IP rights is currently limited, and even problematic. The dilemma here is that ownership of NFT does not translate into ownership of an original work. In other words, buying an NFT does not mean that one is buying the underlying IP rights in a given content. You may consider NFT (unless explicit stated by the artist/ creator) as an autographs of the artist.  I would say NFT is a digital receipt showing that the holder owns a version of a work. Buyers’ beliefs about what they "own" do not translate to legal reality. You won't own the artist by getting the artist autographs, right?

NFT and authenticity 

Due to the size limit and the cost to hold large size of data in blockchain network.  You may consider NFT provide a "shortcut" or "symbolic link" to the digital content itself rather than storing the digital content directly.  In other words, you can have an NFT "pointer" to a file which has been change its content (meta data) by anyone without knowing it.

What is our view?

There are different myths right now in the market about NFTs, when people buy an NFT, they buy exactly that… a token. At best this token represents a digital receipt or digital autograph. Currently, most of NFTs are simply “blank digital claims” that have no legal value and no verifiable link with the actual creation.

NFTs aren’t trustless. It comes down to the fact that nothing that isn’t native to a public blockchain can be managed in a trustless manner. As soon as you re-introduce agents (creator, issuer, market place) and external assets somewhere in the process, then you fall back to traditional trust mechanisms. 

As we look to the future of the art market, NFTs will almost certainly play an important role. These digital collectibles open up a whole new world for artists, musicians, and brands to expand their mediums and tap into new audiences and collectors. 

MERCURY is launching a new add-on soon to connect our e-commerce customer to setup their NFTs and optionally add contract detail (such as ownership, IP) to the NFT to create a uniqueness to customers.

How NFTs protect artist?
James Huang
24 April, 2021
Share this post
Archive
We are fully compliant with the GDPR laws. We promise to safeguard your data and protect your privacy rights.