On June 24, an avid NFT enthusiast Mr. Hu commented on social media, “I participated in the panic buying at midnight yesterday. I clicked and was told that the system was busy and shortly after all skins were sold out.”
Xianyu, a sales platform for idle products under Alibaba, has removed Alipay Dunhuang related NFTs.
The fiery social spread has given the limited edition Alipay NFT a big hype.
When the sales of Alipay NFT was still going strong, the users of Xianyu app (a sales platform for idle products under Alibaba) already started to trade the same NFT on the APP for a much higher price. Some “lucky numbers” such as 0001 or 6666 would resell at a value up to 100,000CNY, and 500CNY for the normal ones. At one point, the price peaked at 700,000CNY.
Before more speculators swarmed in, Xianyu quickly took measures to extinguish the hype. On June 24, Xianyu officially removed all NFT-related products from its virtual shelves.
“NFTs are not cryptocurrencies” Ant Group
Antchain, blockchain solution provider under Ant Group, made the statement: “NFT is not interchangeable, nor divisible, making it different by nature from cryptocurrencies such as bitcoin.”
In response to the launch of Alipay’s new code skin, Antchain emphasized that “NFT and cryptocurrency are essentially different, supported by the actual value of digital goods. NFTs are nonfungible tokens and do not have any currency attributes such as payment functions.
“Please note that there are potential investment risks in art transactions, and solemnly urged art buyers to invest carefully and oppose irrational speculation.” Antchain spokesperson.
In theory, NFTs cannot be traded, they can only be used as display, collection, and gift functions, and the usage is subject to the rules. For example, if the issuer of the NFT digital work is Hangzhou Xianhuo Wanwu Brand Management Co. Ltd. and then copyright belongs to the creator, and it is not allowed to be used for any commercial purposes unless one obtains the written consent of the copyright owner.
The argument started because buyers and sellers have different understandings of NFTs, they have different definitions of the concept and nature of the “property” being traded, causing many disputes.
NFT whirlwind sweeps the world
Since 2021, encryption art and NFT have exploded globally. From the original encryption artist Beeple’s works’ 69 million USD auction price, to famous blue-chip artist Murakami Takashi’s joining the craze, NFT was born with the full intention to trade and collect. Traditional auction institutions have started selling NFT artwork, selling copyrights alongside the NFT itself.
On June 24, cryptocurrency trading platform Binance’s NFT was officially launched. The NFT auctioned includes works such as Andy Warhol’s Three Self-Portraits“and Dali’s Divine Comedy. Unlike digital artwork on Antchain, Binance’s NFT platform can be resold immediately after being auctioned.
Definition of NFT in the legal field
In the field of intellectual property protection in China, intellectual property rights are divided into three categories: copyright, trademark rights, and patent rights. Generally, works of art belong to the scope of copyright.
On June 1, 2021, the third version of Copyright Law of the People’s Republic of China came into effect. A new “audiovisual work” is also included into the definition of the scope of copyright. Since NFTs are mostly pictures and short videos, this new law is intended to protect its copyright.
When someone buys a piece of NFT artwork, what he has is an image, which is accessible on the art medium of NFT. Since the artwork is not just a simple image, the holder cannot print it on other media for commercial use.
In fact, in the digital environment, it does not make much sense to control the ownership of the NFT, because unlike physical assets, the investment gain is not based on the ownership, but rather through copying, issuing or making peripheral products. The eventual right should be negotiated with the creator separately.
Book a meeting here with our China team here to discuss more.
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