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Home Blockchain and web law

What are NFT? A small overview

7. November 2022
in Blockchain and web law
Reading Time: 1 min read
0 0
A A
0
non fungible token g81aadff6c 1280
Key Facts
  • The definition of NFT remains controversial and offers various interpretations.
  • Lawyers struggle with communication around NFTs and their legal status.
  • NFTs could be considered as unregulated bearer bonds.
  • Legal implications depend on the content of the tokens or smart contracts.
  • Blockchain-based NFTs can store a wide range of content, from graphics to proof of ownership.
  • Distributed ledger technology opens up new opportunities, but also poses challenges for lawyers.
  • There is virtually no current case law on NFTs, which complicates the legal situation.

What exactly NFTs (or digital assets) are is still a matter of considerable dispute among legal experts. And it sometimes seems as if not only is the particular legal issue in dispute, but it is also a problem in communication. Just as non-lawyers often equate “company” with “enterprise”, which is of course legally humbug, because the company is “the name of the merchant” (company name is therefore a special great construction 🙂 ), NFT are also often used differently.

Are NFTs now the content stored on a blockchain? Or the underlying smart contract? Or is it the small entry as such? Legally, this can make a very big difference. I once created a graphic some time ago that other blogposts will build on in the near future. Because to the respective legal quibbles one finds already much. But what are NFTs actually?

There is hardly a right or wrong here, because there is virtually no case law on the subject. However, the probably prevailing opinion sees NFTs as bearer bonds not yet regulated by law . NFTs are therefore actually “nothing”, only tokens with a corresponding storage volume of perhaps 3kB. Dhe NFT’s legal handling therefore depends significantly on it, WHAT exactly is stored in the token/smart contract.

 

NFT

 

As you can see, anything could theoretically be stored in NFT, from the familiar “smoking monkeys” to ownership of land. This is the strength in distributed ledger technology, but at the same time it will become the big challenge for lawyers.

Tags: BlockchainBlogCase lawContractdigitalLegal questionSmart contractToken

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