Ownership and Royalties in the NFT World
In its weekly Tokenverse videocast series, DoinGud brings together creators, blockchain experts and NFT professionals for a thoughtful conversation about the future of Web3 technologies and their potential for social impact, led by Journalist and Producer Ania Poullain-Majchrzak.
In this first episode we explored the topic of “Ownership and Royalties in the NFT World” with the following guests:
- Ovidiu-Valeriu Bojor (insta, twitter), a multi-disciplinary artist from Romania, currently based in Barcelona
- Sholi Goodman, IP rights lawyer
- Anja Blaj, co-founder of Future Law Institute and the president of Blockchain Think Tank Slovenia
- Kyle Gordon, artist and advisor, creative strategist, and curator, co-founder at DoinGud
- Manuel Alzuru, humanist, solar punk, and co-founder at DoinGud
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First, Basics About NFTs
What is an NFT?
An NFT, or non-fungible token, represents the ownership of a digital or physical asset and certifies its authenticity and uniqueness (non-fungible). This data representation is encoded on a digital ledger known as a blockchain.
Manu Alzuru sees NFTs as “web3 cookies” (next-generation cookies), or a new way of showing interaction with a smart contract (an agreement between two parties encoded on the blockchain). These records of interactions can involve anything from conducting a financial transaction to attending an event or completing a level in an online course. In a creators’ world, it is also a way to build a direct connection with fans, collectors, curators, etc.
According to Sholi Goodman, NFTs enable you to control the monetization of your own data and activities — an issue that’s hard to tackle due to wide use of social media and web2 technologies.
What does ownership mean in the NFT world?
Artist Ovidiu-Valeriu Bojor recognizes that the term can be confusing. Does a collector own the piece of art, or simply its copyright?
Anja reminds us that smart contracts do not represent a contract in the legal sense of the term. Unlike legal contracts, which are characterized by a negotiation phase followed by an execution phase, smart contracts focus exclusively on the execution phase. In the case of NFTs, this is the process of encoding the sale and transfer transactions on the blockchain.
The DoinGud Royalty Philosophy
As a creator himself, Kyle has a good pulse on what creators want from an NFT platform. Generally speaking, creators are not concerned with the technical aspects of NFTs, nor should they be. Once on a platform, they should be trusting it to provide a royalty model that is fair for everyone.
Yet the general model has been lacking in that domain. For example, most NFT marketplaces have a fixed royalty rate of 10 to 15% for creators, but do not allow royalties to carry over if the NFT is ever transferred or sold outside of their own platform.
DoinGud’s royalty model, on the other hand, allows creators to receive royalties each time a transaction involving their artwork is made — when they sell it for the first time, when it is sold again on the secondary market, and in the future, regardless of the platform where the transaction occurs.
This novel model stems from Manu’s vision of providing a platform where creators can decide for themselves what royalties they want to receive and how to split the percentages between collaborators. In the future, it will also give collectors the freedom to choose the platform where they want to resell. In other words, creators would be entirely free to customize the ownership model for the entire lifetime of their creations.
Along the same lines, Ovidio focuses on the long-term, and likes the idea of unlocking the future of any particular NFT for its owners to provide them with evolving experiences.
The Future of NFT Ownership and Copyright
Sholi believes that digital ownership will be strongly tied to physical ownership in the near future, leading to copyrights being negotiated on a per case basis for any given parties’ content (as is the case today in the physical world). Whether that means royalties in perpetuity, or only three sales down the line, it is a matter of negotiation between the creator and the platform where the NFT is created.
What if the law can actually morph to adapt to the digital world, instead of the other way around? That’s what Anja is proposing. She believes that what is happening right now in the crypto space and, more broadly, within the digital domain, demands a new digital legal dimension.
In the end, it’s about providing creators with the choice to create their own ownership model.
Corresponding Tokenverse episode of this recap article
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About DoinGud
DoinGud is an NFT ecosystem focused on inspiring creativity and positive social impact. We pride ourselves on accessibility and sustainability, providing next-gen Web3 tools to empower our community to create, curate, collaborate, and connect with one another in the digital space.
Thank you for being part of this amazing journey with us.
Article written by Brigitte Fontaine and edited by Adrien Berthou and Manu Alzuru.
