December 8, 2023

British MPs on Crypto Fan Tokens: Action Needed Against NFT Copyright Infringements

A cross-party parliamentary committee has called on the UK government to protect creators from copyright infringement related to non-fungible tokens and address potential harm from sports groups issuing digital assets.

In one press release On 11 October, members of the Culture, Media and Sport Committee warned that the “most pressing issue” were risks to artists’ intellectual property rights. This arises from the ease and speed with which NFTs can be minted, compared to the slow process of artists seeking to enforce their rights.

“Artists risk having the fruits of their hard work stolen and marketed without permission, while fraudulent and misleading advertising poses an additional risk to investors involved in an already risky business,” said committee chair Carolyn Denenage.

The committee recommended in its accompanying report GovernmentTo work with NFT marketplaces to address these abuses by implementing codes of conduct that protect creators, consumers, and sellers from infringement and potentially fraudulent materials sold on these platforms.

The committee also warned of the potential harm that could be caused if leagues or teams create cryptocurrencies to offer to fans. He called for such symbols not to be taken into account when measuring fan interaction.

Many British football clubs including Manchester city And Tottenham Hotspur, have already issued “Fan Codes” to supporters and club members. Such tokens should be purchased Exclusive rights and benefits But the committee claimed that this was often not the case.

The report continued: “We are also concerned that clubs may offer Fan Tokens as a convenient form of fan engagement in the future, despite the volatility of their prices and the reservations of fan groups.”

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The commission also claimed that the volatility of these tokens could cause financial harm to fans who are unaware of the “inherently risky” nature of the asset.

“In the world of sports, clubs advertise volatile crypto assets in order to extract more money from loyal fans. They are often promised perks and benefits that do not exist.”

The committee concluded that “measures of fan participation in sport, including the upcoming organization of football, should explicitly exclude the use of fan symbols.”