As we explained earlier, a non-fungible token (NFT) is not a form of intellectual property. It doesn’t look like a copyright, patent, or trademark. This is closest to the form of obtaining a “unique” digital file. However, NFTs, because they are associated with copyrighted works such as art, are related to copyright. And, like other art forms, they can be bought, sold, stolen, and even ransomed. Actor Seth Green recently paid $260,000 to recover a stolen Bored Ape Ethereum NFT that he paid $200,000 for, Business Insider reports. He was supposed to appear in a series called Tavern White Horse. He lost this monkey and three other Bored Ape NFTs worth over $300,000 in a recent phishing attack. Bored Ape NFTs are popular among thieves. In June, Bored Ape NFTs worth $360,000 were stolen from Yuga Labs. This is the third attack on the account since April. According to the Bored Ape Yacht Club website, this is “a limited collection of NFTs where the token itself serves as your membership to the Swamp Monkey Club.” As Benzinga describes it,
The Bored Ape Yacht Club (BAYC) is an exclusive community for owners of apes and mutants themed NFT collections on the Ethereum blockchain. They are commonly referred to as bored monkeys, and only 10,000 works of generative art will ever exist.
The collection is reported to be worth over $1 billion, although NFT values fluctuate wildly. According to Fast Company, “whoever has the Bored Monkey can turn it into any movie, music, TV, book, or media project they want.” This contrasts with the practice of some other NFT companies, which prohibit buyers from commercially using their NFTs. However, some companies allow you to license NFT images. As fast company explains that the NFT license, which can be used by any NFT project creator for free, grants certain rights to NFT holders, namely the commercialization of their NFT merchandise with a gross income of up to $100,000 per year. But Bored Ape licenses have no such limitation, according to Fast Company:
The Bored Ape Yacht Club has made it clear that NFT holders have full rights to commercialize their monkey, i.e. they are not limited to merchandise and have no monetary limit.
As business insider noted,
The Bored Ape NFT Yacht Club Collection, which caused a celebrity buzz in January, is copyrighted by Yuga Labs. While buyers of NFTs have the right to license and distribute them, the agreement did not cover stolen NFTs. Green was sure he still retains the right to distribute the monkey because it was stolen, he said.
In other words, the NFT can embody two forms of intangible property rights: in the NFT itself (which is not intellectual property) and in the work depicted in the NFT (which may be copyrighted). Ownership of one thing does not necessarily mean ownership of an affiliated thing. This is comparable to the legal difference between a painting and an image depicted in that painting. As the Minnesota Lawyers for the Arts explains, when an artist creates a painting, the artist owns both the copyright in the artwork and the physical artwork. Copyright is an intellectual property right. Ownership of a physical work of art is a personal property right. Selling a physical work of art does not transfer the copyright to the work of art. Similarly, the transfer of copyright does not necessarily mean the transfer of personal ownership of the physical work of art.