nfts in intelectual property

NFTs represent the digital ownership of an underlying piece of art recorded on the blockchain. The rising popularity of NFTs has led to many ‘derivative NFTs’ and intellectual property infringements of NFTs. Derivative NFTs are collections created by leveraging the creative assets of previous NFT collections. 

Are derivative NFTs an infringement of Intellectual Property (IP) rights? Recently, Yuga Labs, the founder of Bored Ape Yacht Club, filed a complaint against Ryder Ripps. Ryder Ripps is a conceptual artist who created the recent NFT collection titled: RRBAYC OFFICIAL Ryder Ripps. The claim states that Ryder Ripps has created a collection purporting to be the same as the original BAYC collection. That is an outright breach of the fair use of the trademark. The trademark fair use typically requires a non-competing and non-confusing use of a mark. This case highlights one of the longest-standing issues facing the NFT industry: IP infringement.

What is the outcome that Yuga Labs is seeking?
  1. The firm wants a court injunction to force Ryder Ripps to stop using its mark to sell NFTs.
  2. The firm is also seeking damages and profits made from the sales of the collection using its mark.

The thread further lays out details surrounding the case.

What are IP rights that protect creators and collectors?

IP rights protect the creators of their original creations. These terms typically laid out the terms and conditions of the NFT collection to expressly indicate the legal rights of the creators. It is common practice for creators to indicate that ‘graphics for NFTs, underlying Art, and the Brand Name’ may not be used in connection with any product or service that does not belong to the collection, or in any manner that disparages and discredits the firm.

However, some collections also provide their holders with IP rights. One case in point would be BBRC IVY BOYS. Holders are given the liberty to use their NFTs for commercial and non-commercial use. However, a caveat is that holders must only use their NFT in its entirety when monetizing it. Other collections with IP rights for holders include BAYC and CryptoKitties.

bbrc ivy boy


Having a good understanding of IP rights is important in laying out clear boundaries for the usage of NFTs. Better to always err on the safe side and not get into trouble with IP protection laws folks! While currently, the case surrounding Ryder Ripps is still evolving, it would be safe to assume more tightening of regulations in NFTs. As creators, clear IP rules are important to protect your collection from damages. And as investors, we want clarity of what we truly own too.

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