As the NFT industry becomes more formalized, with major artists, studios and brands involved, the space grapples with how best to protect intellectual property.
For example, Bored Ape Yacht Club maintains strict use of IP and has taken people to court while CryptoKitties uses the NFT license. Until recently, it appeared that NFT projects were attempting to follow the previous IP from Web 2.0, but a different approach has begun to receive more adoption.
- What is CC0
- Because the new collections are using it
- How different licenses might affect performance
- Examples of derivative products under CC0
What is the CC0 license?
Copyright issues are a constant source of attrition among brands, creators, and the community using the product. With the NFTs in particular, several court cases have already been launched to settle disputes between the parties involved.
An example is “Roc-A-Fella Records Inc. v. Damon Dash”, where there is a dispute over the copyright owner of Reasonable Doubt, Jay-Z’s debut album, as there was an intention to sell it as NFT.
CC0 is the Creative Commons 0, where “0” equals “no reserved rights” on the intellectual property of the project. It is a type of copyright that allows creators to give up the legal interest in their work and make it public almost instantly. When they think about NFTs, owners can take the art on their NFT and use it for any purpose: marketing, editing, branding with it, anything. In fact, this license means you don’t even have to own an NFT from the collection – anyone can use any NFT in the collection, even as a company logo, if they so wish.
Which collections use CC0 and why?
One of the first projects using the CC0 license was Nouns. The idea behind the project was to build a community, and subsequently a DAO, that would promote innovation by using Nouns characters to create derivatives (new projects based on it). They have already launched a sunglasses collection, a LilNouns NFT collection, and have other initiatives that you can follow on their proposal page.
Moonbirds followed a different path. It started with a “normal” license, but in August 2022moved to CC0.
As of August 22, the main collections using CC0 as their distribution license model were:
- Lil nouns
- loot project
- Lunar birds
You can find a more complete list here.
And why are they doing it?
The idea is to promote the project to a wider audience so that they can add value to it. With more opportunities for interaction through derivative collections, original art-related merchandise, and a wider community, interest in the collection grows, to the benefit of its creators and NFT holders.
Hence, assigning the rights to their collection can actually be beneficial for the creators and holders:
- Creators / DAOs usually still receive royalties on the secondary market
- Encourages the creation of derivatives, which brings more attention to the original collection
- Derivatives usually give an airdrop (or whitelist spot) for the original collection holders
- Creators / DAOs can fund new projects to increase the popularity of the collection by creating a flywheel movement
Market Comparison: CC0 x Other Licenses (Trading Volume and Transactions)
The top 10 NFT collections in trading volume that are not CC0 licenses, over the past 30 days, had a total of $ 168 million, as shown in the graph below.
The trading volume of the top 5 CC0 license collections over the past 30 days (see chart below) was $ 32 million. This represents approximately 27% of the trading volume for the top 10 non-CC0 licenses.
We have a total of transactions in the last 30 days for these top 10 NFT collections without the CC0 license, we have a total of 89,177 transactions.
Similarly, when we look at the best CC0 collections (graph below), we have a total of 7140 transactions, 8% in comparison.
The best CC0 license collections already had nearly 30% of the trading volume of the top 10 non-CC0s in the last 30 days, even with 8% of the number of trades. These numbers will increase, as more collections are transitioning to this licensing model.
This isn’t a trend that’s going to fade, especially with a very successful case like the Noun Collection. As Moonbirds also announced their plans to switch to a DAO to oversee and incentivize the use of their logo / branding, this process of releasing copyrights to the collection and sharing direction with NFT holders (the DAO ) is an interesting development for investors: owning a piece of the brand by owning a piece of their collection.
Examples of derivative products under CC0
XCOPY, an iconic creator of NFT, placed his artwork “Right Click and Save as Boy” under the CC0 license in January 2021. This CC0 license has already led to many derivatives.
And they are available for trading, giving more exposure to the original artwork.
After their CC0 announcement, there was also an explosion of Moonbirds derivatives. One example is Mournbirds, where the creator explicitly mentioned that the new collection was made possible thanks to the license.
This isn’t a trend that’s going to fade, especially with a very successful case like the Noun Collection. As Moonbirds also announced their plans to switch to a DAO to oversee and incentivize the use of their logo / branding, this process of releasing copyrights to the collection and sharing its direction with NFT holders (the DAO ) is an interesting development for investors: Own a piece of the brand by owning a piece of their collection.
This piece was provided by the Footprint Analytics community on August 30, 2022 Thiago Freitas
Data source: CC0 dashboard
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