Share this article
U.S. Government Study Concludes No NFT-Specific Legislation Needed, Current Copyright Laws Adequate
The study comes despite warnings about the risks associated with NFTs due to bad actors around correcting misinformation or misappropriation of trademarks.
Updated Mar 13, 2024, 7:30 p.m. Published Mar 13, 2024, 7:02 a.m.
Make us preferred on Google
- Current laws around intellectual property are enough to deal with concerns around NFTs, a government study has found.
- The study was requested by Former Democratic Senator from Vermont, Patrick Joseph Leahy and Democratic Senator from North Carolina, Thom Tillis, in June 2022.
The current intellectual property laws are adequate to deal with concerns about copyright and trademark infringement associated with non-fungible tokens (NFTs), a 112-page long study by the United States Patent and Trademark Office (USPTO) and the U.S. Copyright Office has concluded.
The study was requested by Former Democratic Senator from Vermont, Patrick Joseph Leahy and Democratic Senator from North Carolina, Thom Tillis, in June 2022.
STORY CONTINUES BELOW
The USPTO and the Copyright Office conducted three public roundtables and solicited comments from interested stakeholders. The offices found that most stakeholders that the current laws were adequate, even though “trademark misappropriation and infringement are common on NFT platforms.”
“The Offices agree with these assessments and do not believe that changes to intellectual property laws, or to the Offices’ registration and recordation practices, are necessary or advisable at this time,” the study concluded.
The stakeholders also expressed concerns that NFT-specific legislation would be premature at this time and could impede the evolving development of the tech around NFTs.
This despite a technology industry association warning "that bad actors misappropriate trademarks to solicit, and then exploit, consumers’ personal information and urged the Offices to consider this risk in the context of NFTs."
U.S. regulation around NFTs has had a shade of ambiguity, if not a spectrum. In August 2023, Impact Theory, a California-based media company, settled charges brought by the U.S. Securities and Exchange Commission (SEC), the first NFT-related enforcement action by U.S. regulators.
Impact Theory sold three tiers of NFT offerings, and because the company promised investors would profit off the collectibles, the SEC deemed these NFTs to be securities. Impact Theory agreed to set up a fund to reimburse investors and pay a fine of $6.1 million. The case did not suggest regulators consider all NFTs to be securities.
The study said the lack of "controlling judicial precedent regarding whether a trademark registration for physical goods can be enforced against the use of that mark on similar digital goods tied to NFTs complicates enforcement efforts."
Still, the likes of even Donald Trump have introduced and sold out their NFT collections.
Read More: NFT Providers May Need Registration to Comply With UK Money Laundering Rules
More For You
Pudgy Penguins is building a multi-vertical consumer IP platform — combining phygital products, games, NFTs and PENGU to monetize culture at scale.
What to know:
Pudgy Penguins is emerging as one of the strongest NFT-native brands of this cycle, shifting from speculative “digital luxury goods” into a multi-vertical consumer IP platform. Its strategy is to acquire users through mainstream channels first; toys, retail partnerships and viral media, then onboard them into Web3 through games, NFTs and the PENGU token.
The ecosystem now spans phygital products (> $13M retail sales and >1M units sold), games and experiences (Pudgy Party surpassed 500k downloads in two weeks), and a widely distributed token (airdropped to 6M+ wallets). While the market is currently pricing Pudgy at a premium relative to traditional IP peers, sustained success depends on execution across retail expansion, gaming adoption and deeper token utility.
More For You
Crypto faces fork in the road as Clarity Act support wavers, Bitwise says
The asset manager argued that without federal legislation, the industry has three years to become indispensable before political winds potentially shift.
What to know:
- Bitwise said in a blog post Monday that Polymarket odds for the Clarity Act have fallen from 80% to 50% following industry pushback.
- If the bill fails, Bitwise believes crypto must achieve mass adoption in stablecoins and tokenization to force a regulatory hand.
- The firm anticipates a sharp rally upon the bill's passage, while a failure would likely lead to a "slower ascent" tied to proven utility.
