Blockchain And Nft Ip Issues.

31 Jan 2026 --
0 Comments

Blockchain and NFT Intellectual Property (IP) Issues

1. Introduction

Blockchain is a decentralized digital ledger, and NFTs (Non-Fungible Tokens) are unique digital assets recorded on a blockchain. NFTs often represent digital art, music, collectibles, or intellectual property.

While blockchain enables proof of ownership, transparency, and transferability, it also raises complex IP issues, because ownership of an NFT does not automatically confer copyright or patent rights over the underlying work.

Key IP Issues with NFTs and Blockchain:

Copyright Ownership

Buying an NFT typically transfers token ownership, but not copyright unless explicitly assigned.

Trademark Infringement

NFTs using logos, brand names, or characters may infringe trademarks.

Unauthorized Minting / Copying

Someone may mint NFTs of copyrighted works without permission (“unauthorized tokenization”).

Smart Contracts and Licensing

NFTs often rely on smart contracts to enforce royalties; legal enforceability is emerging.

Jurisdictional Challenges

Blockchain is global; disputes may arise in multiple countries.

2. Key IP Legal Considerations in NFTs

Ownership vs. Licensing: NFT ownership is not equal to copyright ownership unless explicitly stated.

Royalties: Smart contracts may automatically pay royalties, but legal enforceability may vary.

Derivative Works: Creating new NFTs based on existing copyrighted material may constitute infringement.

Moral Rights: Some jurisdictions protect the artist’s rights even after NFT sale.

3. Case Laws Illustrating Blockchain and NFT IP Issues

Here are six notable cases, demonstrating how courts are approaching NFT-related IP disputes:

Case 1: Ryder Ripps v. Yuga Labs (2022, USA)

Facts:

Yuga Labs created the Bored Ape Yacht Club (BAYC) NFTs.

Ryder Ripps sold NFTs resembling BAYC without authorization, claiming parody.

Issue:

Whether minting NFTs of another’s copyrighted characters constitutes infringement.

Decision:

The case is ongoing, but courts have recognized that unauthorized minting of copyrighted content may infringe copyright and trademark.

Lesson:

Minting NFTs does not automatically grant legal rights

Parody defense may apply but is context-specific

Case 2: Miramax v. Tarantino (2021, USA)

Facts:

Quentin Tarantino attempted to sell NFTs of handwritten scripts for "Pulp Fiction"

Miramax claimed copyright ownership

Issue:

Can the creator sell NFTs without infringing the studio’s copyright?

Decision:

Court held Miramax owns underlying copyright

NFTs can’t override copyright claims

Lesson:

NFT ownership does not bypass pre-existing copyrights

Artists and NFT creators must secure proper licensing

Case 3: Hermès v. Mason Rothschild (2022, USA)

Facts:

Rothschild created “MetaBirkins” NFTs resembling Hermès Birkins

Hermès sued for trademark infringement and dilution

Decision:

Court granted preliminary injunction

NFTs depicting trademarks without consent are actionable infringement

Lesson:

Trademarks extend to digital assets like NFTs

Corporations should monitor NFT marketplaces for infringement

Case 4: Evolved Apes v. NFT Marketplace Users (2022, USA)

Facts:

NFT project “Evolved Apes” collapsed, team allegedly misappropriated user funds

Users filed IP and contractual claims

Issue:

Accountability in NFT projects, IP rights, and contractual obligations

Decision:

Court emphasized smart contract terms alone are not sufficient; traditional IP law and contract law still apply

Lesson:

Blockchain cannot bypass contract and IP obligations

Clear legal terms are necessary in NFT launches

Case 5: Bored Ape Yacht Club NFT Resale Royalties Dispute (USA, 2022)

Facts:

NFT owners resold BAYC NFTs without paying royalties encoded in smart contracts

Issue:

Are on-chain royalties enforceable under copyright and contract law?

Decision:

Courts held smart contract royalty enforcement is complex, may require traditional legal mechanisms to enforce

Lesson:

Blockchain automates transactions, but legal enforceability may need civil action

Corporations should include off-chain legal backup

Case 6: NFT Art Theft Cases (Multiple Artists, 2021-2023)

Facts:

Various artists found their digital art minted as NFTs without permission

Issue:

Decision:

Courts consistently uphold copyright protection for underlying art, even if NFT ownership changes

Lesson:

Unauthorized minting is actionable

Artists should register copyrights and consider DMCA takedown notices on NFT marketplaces

4. Corporate Strategies to Manage IP Risks in Blockchain and NFTs

Clear Licensing Agreements

Explicitly define rights conveyed with NFT

Specify royalties, resale rights, and derivative works

Trademark and Copyright Registration

Smart Contract Integration

Use blockchain for automated royalty payments

Backed with legal enforceability clauses

Monitoring and Enforcement

Monitor NFT marketplaces for infringement

Take legal action or DMCA takedowns against unauthorized minting

Jurisdictional Planning

Address cross-border disputes in licensing agreements

Choose governing law for smart contracts

5. Key Lessons from Cases

Case	Key Takeaway
Ryder Ripps v. Yuga Labs	Unauthorized NFT minting can be copyright infringement
Miramax v. Tarantino	NFT sale doesn’t override existing copyrights
Hermès v. Rothschild	Trademark rights extend to NFTs; digital dilution actionable
Evolved Apes	Smart contracts alone do not replace contract/IP law
BAYC Resale Royalties	Blockchain royalties need traditional legal enforceability
NFT Art Theft Cases	Unauthorized NFT minting violates copyright; DMCA and litigation applicable

6. Conclusion

Blockchain and NFTs create exciting opportunities for IP monetization but introduce new IP risks. Key points:

Ownership of an NFT ≠ ownership of IP unless clearly licensed

Smart contracts help but cannot replace legal enforcement

Corporations and artists must adopt proactive registration, licensing, and monitoring strategies

The case laws illustrate that courts are applying traditional IP law to digital assets, and legal clarity is crucial for NFT projects to avoid infringement and litigation.