You may have heard of the sale of the digital artwork Nyan Cat, a GIF, for an estimated five hundred and ninety thousand US dollars in 2021 — an image that had circulated widely across the internet. You may have wondered why such works command these prices when anyone can view and share them. The answer is that each of these artworks is a non-fungible token (NFT), whose owner holds an exclusive right of disposal over it; what everyone else holds is merely a non-original copy.
In this article we look more closely at what these tokens are, and whether their owner holds intellectual property rights over them in the Sultanate of Oman.
What Are Non-Fungible Tokens (NFTs)?
NFTs are unique digital tokens tied to a digital work or format — an electronic drawing, an image, a video, or an audio clip — rendering it non-fungible. The original digital product is paired with its encrypted digital token, guaranteeing that it is the sole original copy. An NFT is a crypto-asset over which only the actual owner holds the right of disposal; buying such a token therefore necessarily entails the transfer of the digital work — the digital artwork, for example — together with the unique cryptographic identifiers that distinguish it, from the seller to the new buyer.
Trading in NFTs rose to prominence in early 2020, and in 2021 the value of NFT transactions reached approximately USD 14 billion, prompting global companies including Nike and Louis Vuitton to move into producing and selling such tokens.
[For legal team review: the original article was published on the previous website as an image showing its first page only — please complete the remainder from Mr. Ahmed Al Mahrouqi's original file.]