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NFT IP Licensing for Truth Labs Holders
NFT IPs are subject to debate. To solve the IP dilemma, Truth Labs has taken a new path. It decided to give each holder of The 187 collection NFTs tailor-made contracts. This move potentially circumvents regulatory issues while maximizing value for holders.
What does Truth Labs’ agreement with the owners consist of?
Truth Labs has already entered into two unique agreements with holders. The first involves King Kong, who has become an official partner in the Goblintown collection. Under the terms of this partnership, he will earn a 1% royalty from both past and future sales. It guarantees him a payout of 40-50 ETH.
The second unique contract has been negotiated with Ding Ding. It focuses on the production of real goods inspired by her NFT, The Waldragon. In this scheme, Ding Ding is described as an “equal partner” in the income generated from the sale of goods.
As the NFT market struggles with uncertainty, the question of the value and utility of owning an NFT becomes more relevant. Some, such as Pudgy Penguins, have successfully leveraged the IP for their projects, entering into licensing deals for physical toys and children’s books. NFT collective Deadfellaz has adopted a similar strategy, partnering with organizations such as the Chicago Bulls, DraftKings and Wrangler.
What are the other models for IPs?
In contrast, Proof Collective switched its Moonbirds collection to a CC0 license last August, causing an uproar among its holders. Some believed the decision was a centralized bait-and-switch, as it happened long after people had originally bought the NFTs.
Yuga Labs followed suit, giving CryptoPunks holders free rein to use their NFT’s IP through CC0 licenses. This makes the IP public domain and available for any purpose, including commercial use.
While CC0 licenses give holders considerable freedom, they also allow anyone to use the same IP. According to some Web3 commenters, that defeats the purpose of owning a unique piece of digital art in the first place.
By creating individual contracts for each holder of the NFTs in the 187 collection, Truth Labs navigates a middle ground. Also, it allows it to avoid SEC scrutiny while preserving the uniqueness and value of their NFTs.
The company aims to leverage the IP of Web3 to weather the prolonged crypto winter. This unique approach to NFT IP management, while still in its early stages, may represent a new way forward for Web3 projects in a rapidly evolving landscape.
