BAYC (Bored Ape Yacht Club) is one of the most notable NFT collections in the crypto space. NFTs have gained traction in recent years, with some celebrities like rapper Snoop Dogg taking increased interest in them. People buy NFT token projects in hopes of obtaining full rights to the tokens. However, a recent Galaxy Digital Research shows that this may not be the case most of the time.
Allegedly failing to transfer IP rights to NFT token purchasers
On Friday, Mike Novogratz’s investment firm Galaxy Digital published a research paper on the NFT industry. The company wanted to investigate NFT licensing in the industry and suppress the lies surrounding it. The research highlighted the growing interest in NFTs. He noted that the industry likely has a “bright future.” However, he pointed out that in most cases, when buyers purchase NFT, they do not receive the appropriate intellectual property rights.
During research, Galaxy Digital discovered that the appropriate commercial rights to BAYC and Yuga Labs’ other collections were not transferred to those who allegedly bought the NFTs. This is due to an alleged conflict in Yuga Labs’ proprietary terms. According to Yuga Labs, when someone buys a BAYC NFT, they “wholly” own the underlying Bored Ape. However, the article claims that there is absolutely no provision for the transfer of intellectual property (IP) rights to the buyer of BAYC. This indicates that, in a legal sense, the buyer allegedly has no intellectual property rights over BAYC. The same problem exists with other collections like MAYC and BAKC.
Moonbirds NFTs seem to have the same problem
In addition, popular satirist Ryder Ripps was in the news a few months ago due to issues with Yuga Labs. Yuga Labs had sued him for “defrauding” consumers with copycat NFTs. It seems that Ripps has created a fake version of the BAYC collection, which it calls RR/BAYC. According to Ripps, this was an attempt to prove that BAYC holders did not actually receive proper royalties for their NFTs. Alongside the Yuga Labs and BAYC collection, Galaxy Digital pointed out another NFT collection with similar copyright issues. This was the Moonbirds NFT collection published by PROOF Collective.
The research notes that there is a discrepancy between PROOF Collective’s public statement and Moonbirds’ license agreement. The research argues that those who issue NFTs – in this case, Yuga Labs and PROOF Collective – are the true owners of the rarity feature. “To truly own this rarity feature, it is not enough to have the digital token that entitles you to a license because the license can change at any time,” he adds. However, the research notes that the World of Women (WoW) collection stands out. He emphasized that it is the only collection that gives full IP rights to NFT buyers. After this development, the value of ApeCoin, which was issued by Yuga Labs behind BAYC, dropped from $5.44 to $5.10.
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