Ornella Hernandez

<div id="highlights-block_630f9b55eda23" class="highlights">
 <ul>
 <li>Licenses provide open source codified versions of intellectual property rights</li>
 <li>Murky IP licensing has recently caused confusion regarding rights of NFT buyers</li>
 </ul>
 
</div>



Venture capital firm Andreessen Horowitz’ crypto arm, a16z, released six NFT-specific copyright licensing frameworks on Wednesday as part of a free and public set of “Can’t Be Evil” Licenses, in the style of <a href="https://creativecommons.org/">Cr</a><a href="https://creativecommons.org/" target="_blank" rel="noreferrer noopener">e</a><a href="https://creativecommons.org/">ative Commons</a>.



A blog post from Miles Jennings, general counsel at a16z, and Chris Dixon, a managing partner who founded a16z, <a href="https://a16zcrypto.com/introducing-nft-licenses/" target="_blank" rel="noreferrer noopener">stated</a> that the firm is addressing the existing ambiguity and confusion around NFT licensing.



Their aim is to clarify an NFT creator, buyer or seller’s rights regarding the artwork of digital assets in order to “democratize access to high quality licenses and encourage standardization across the web3 industry.”&nbsp;



The “Can’t Be Evil” set is meant to serve as a template for NFT projects to consider when creating and selling NFTs, <a href="https://a16zcrypto.com/wp-content/uploads/2022/08/Cant-Be-Evil-Licenses.pdf" target="_blank" rel="noreferrer noopener">according</a> to its Terms and Conditions.&nbsp;



The slate of open source licenses are based on US law and relate to copyright only, excluding other forms of intellectual property, including personality rights, stated the document. US copyright laws do not automatically grant buyers of both traditional and digital assets the right to reproduce, adapt or publicly display the artwork without a license.



The six options each outline different degrees of freedom intended to help creators protect or release their intellectual property (IP) rights, especially those enabling buyers to modify the artwork or create derivative works.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="411" src="https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png" alt="" class="wp-image-29747" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=2048 2048w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/Screenshot-2022-08-31-at-19.40.25-1024x411.png?w=50 50w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /><figcaption>Source: <a href="https://a16zcrypto.com/introducing-nft-licenses/">a16zcrypto</a></figcaption></figure>



The Licenses were developed in partnership between a16z Crypto and the law firms Latham &amp; Watkins LLP and DLA Piper LLP. Available on GitHub, NFT projects are able to add a reference to a specific license directly into a smart contract.&nbsp;&nbsp;



The “Can’t Be Evil” title was inspired by Google’s “don’t be evil” slogan and puts the trust in the code, according to a16z



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“Instead of trusting people or corporations to not be evil, we can ensure through code that they “can’t be evil,” the company stated.&nbsp;</blockquote>



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">can’t be evil &gt; don’t be evil&mdash; cdixon.eth (@cdixon) <a href="https://twitter.com/cdixon/status/1470223992757927936?ref_src=twsrc%5Etfw">December 13, 2021</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Creative Commons licenses have lately been put in the spotlight by NFT projects such as Moonbirds, whose founders recently <a href="https://cms.blockworks.co/from-moonbirds-to-cryptopunks-terms-of-service-are-changing/" target="_blank" rel="noreferrer noopener">moved to a Creative Commons Zero (CC0) license</a> and rescinded its holders’ commercial art rights without warning.&nbsp;



Yuga Labs-owned CryptoPunks and Meebits have also updated their terms and conditions to allow NFT holders to use the image of their NFT however they want, without permission from Yuga Labs, which legally still owns the rights and title of the art.



NFTs are, at their core, a piece of software code. It is quite common for the actual image or artwork to be stored off-chain on a remote server, while only the metadata is on-chain.&nbsp;



When an NFT is bought and transferred to a crypto address, the purchaser is only acquiring the metadata associated with the remote image, and not the actual content file. That’s why intellectual property rights are a murky subject.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/the-breakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>
</ul>

a16z

A16z Creates NFT Licensing Framework to Standardize Collectors’ Rights

Michael Bodley

<div id="highlights-block_61fda8b65515c" class="highlights">
 <ul>
 <li>Punk 6529, as the anonymous NFT collector is known, has more than 240,000 Twitter followers</li>
 <li>The launch raises due diligence questions for investors accustomed to deeply parsing the backgrounds of fund managers</li>
 </ul>
 
</div>



An anonymous CryptoPunk NFT owner with an influential Twitter following has launched a fund that invests in NFTs on behalf of institutional investors.



<a href="https://twitter.com/punk6529" target="_blank" rel="noreferrer noopener">Punk 6529</a>’s venture, confirmed by two sources with knowledge of the matter, represents one of the first such funds run by an unnamed portfolio manager — and is a validation of a metaverse world in which the reputations of pseudonymous whales are built upon their savvy in picking NFT projects and not their background.



Blockworks granted sources anonymity to discuss sensitive business dealings. Punk 6529 confirmed the fund launch but declined to comment further.



6529 NFT Fund, which has drawn the interest of institutional investors, including crypto fund-of-funds operators, started trading recently. The manager has not revealed the amount of capital raised.



<a href="https://www.larvalabs.com/cryptopunks/details/6529" target="_blank" rel="noreferrer noopener">Punk 6529</a>, the owner of a slew of other rare, valuable NFTs, has more than 240,000 followers on Twitter, where they expound on everything from the future of the metaverse to <a href="https://twitter.com/punk6529/status/1428638532684423173" target="_blank" rel="noreferrer noopener">regulation</a> by the Securities and Exchange Commission (SEC) to <a href="https://twitter.com/punk6529/status/1435229526133547010?lang=en" target="_blank" rel="noreferrer noopener">wealth inequality</a>.&nbsp;



“The Metaverse will actually happen this decade,” <a href="https://twitter.com/punk6529/status/1429514317108502536" target="_blank" rel="noreferrer noopener">Punk 6259 wrote.</a> “If it is open, human innovation will flourish. If it is closed, we are digital serfs of sorts. We 100,000 or so people right now are the front-line in this battle and we have to do it ourselves.”



The account is also building a virtual museum, <a href="https://opensea.io/assets/0xb47e3cd837ddf8e4c57f05d70ab865de6e193bbb/6529" target="_blank" rel="noreferrer noopener">6529 Museum</a>, and operates a <a href="https://oncyber.io/6529gm" target="_blank" rel="noreferrer noopener">number</a> of<a href="https://oncyber.io/6529photo" target="_blank" rel="noreferrer noopener"> virtual galleries</a> for <a href="https://oncyber.io/6529ab" target="_blank" rel="noreferrer noopener">viewing</a> NFTs and digital photographs.



In addition, the investor has been involved in bids for high-profile NFT projects, including bidding on imprisoned Silk Road founder <a href="https://cms.blockworks.co/imprisoned-silk-road-founder-sold-his-first-nft-to-a-dao-trying-to-free-him/" target="_blank" rel="noreferrer noopener">Ross Ulbricht’s</a> collection, <a href="https://www.theblockcrypto.com/post/132991/a-dao-trying-to-free-julian-assange-has-raised-4-million-and-counting" target="_blank" rel="noreferrer noopener">The Block reported</a>. They’ve also owned <a href="https://twitter.com/punk6529/status/1433550456853196811" target="_blank" rel="noreferrer noopener">one of the CryptoKiddies</a>, which have sold for more than 100 ether each.



<h3 class="wp-block-heading">Due diligence questions</h3>



The fund raises due diligence questions for deep-pocketed limited-partners looking to invest, sources said. Institutions typically run detailed vetting processes before backing a manager, including scouring an individual’s background and checking references. One of the sources, who invests in crypto funds, said he did not know Punk 6529’s identity.



How long of a lockup on investor capital the fund will impose also isn’t clear. It could impose fairly modest, hedge-fund-like liquidity, or the vehicle could go the private equity route — favored by a number of real-world funds that invest in art — and hold investor cash for a much longer period.



“If you’re going to build it as more of a trading platform, you do it as a hedge fund,” one source said. “But if you think of it more like art, you need to stick it in a [private equity] fund.”



There are few investment professionals with the know-how, at the moment, to mint serious money from NFT markets — so investors hungry for exposure may well sidestep traditional procedures.&nbsp;



It is believed Punk 6529 owns potentially thousands of NFTs. The anon also&nbsp;<a href="https://rattibha.com/thread/1445468399656595456?lang=en" target="_blank" rel="noreferrer noopener">claims</a>&nbsp;to have started investing in bitcoin in summer 2013 and “played a small role in BTC’s development and acceptance.”



Punk 6529 has urged first-time and small-time NFT investors to pony up only money they are willing to lose, and also to maintain custody over their assets rather than keeping them on exchanges and non-fungible marketplaces.



But for now, though, their focus is on much bigger investors. “2022 will be the year of the institutions in NFTs,” they wrote. “Plan accordingly!”



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/the-breakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>
</ul>

NTFs