Source | The NLR
The Thinking Lawyer’s Guide to Non-Fungible Tokens (NFTS)
First there were CryptoKitties. Then came digital art, CryptoPunks and NBA Top Shot. But when Beeple’s digital art piece “Everydays: The First 5000 Days” sold at Christie’s for US$69 million, the NFT mania truly began. And as with any wave of media mania, there also came the groundswell of negative media and hand-wringing about NFTs.
We believe it is time to address the pros and cons of NFTs from a thoughtful, legal perspective. NFTs are not all evil nor are they a panacea for artists and musicians. Here are our thoughts on the most common questions we have received from our clients about NFTs.
WHAT ARE NFTS?
NFTs are non-fungible tokens issued on a distributed ledger such as a blockchain. They are similar to cryptocurrencies like bitcoin in that they can be identified individually and are authenticated through a decentralized system of nodes via a consensus protocol. However, they differ from cryptocurrencies in that they are each unique, indivisible, and “non-fungible.”1