- UK parliamentary committee emphasizes the urgency of protecting artists’ intellectual property rights in the NFT space.
- Recommendations include introducing a code of conduct for NFT platforms to prevent copyright infringements.
- Concerns raised about the financial risks posed by fan tokens offered by sports leagues and teams.
A bipartisan parliamentary committee in the United Kingdom has urged the British government to take steps to safeguard the rights of creators against copyright infringement associated with nonfungible tokens (NFTs) and to address potential concerns stemming from sports organizations issuing digital assets.
In an official press release on October 11th, the Culture, Media, and Sport Committee members highlighted the most pressing issue, which is the threat to artists’ intellectual property rights due to the ease and speed at which NFTs can be created, in contrast to the comparatively slow process for artists to enforce their rights.
Committee Chair Dame Caroline Dinenage expressed concern, stating, “Artists are at risk of having their hard-earned work appropriated and promoted without consent, while deceptive and misleading advertisements add an additional layer of risk for investors in an already inherently risky business.”
In their accompanying report, the committee recommended that the government collaborate with NFT marketplaces to combat these infringements by implementing a code of conduct designed to protect creators, consumers, and sellers from the sale of infringing and potentially fraudulent material on these platforms.
Additionally, the committee raised concerns about the potential adverse effects of sporting leagues or teams creating cryptocurrencies to offer to their fans and proposed the prohibition of such digital assets.
This concern arises from the actions of various football organizations based in the United Kingdom, such as Manchester City and Tottenham Hotspur, which have issued “fan tokens” to their followers and club members. Although the purchase of these tokens is intended to grant exclusive rights and benefits, the committee argued that this was often not the case.
Passion Knows No Boundaries.
— Socios.com (@socios) September 28, 2023
The report stated, “We are also concerned that clubs may present fan tokens as a suitable means of fan engagement in the future, despite their price volatility and reservations among fan groups.”
The committee asserted that the volatility of these tokens could potentially harm fans who were unaware of the inherently risky nature of these assets, saying, “In the world of sports, clubs are promoting volatile crypto asset schemes to extract additional funds from loyal supporters, often with promises of privileges and perks that go unfulfilled.”
As a result, the committee concluded that “any assessment of fan engagement in sports, including forthcoming football regulations, should explicitly exclude the use of fan tokens.
Disclaimer: Please note that the viewpoints and perspectives expressed by the author, as well as any individuals referenced in this article, are intended solely for informational purposes. They should not be construed as financial or investment advice. It’s important to acknowledge that investing in or trading cryptoassets carries inherent financial risks.