This week, an interesting post was published here
about Ethereum’s token standard for NFTs: ERC-721. According to Dr. Craig Wright (who won a major court case
last year involving 1.1 million Bitcoin, worth billions of dollars), the ERC-721 standard is a direct infringement on one of his patents that was approved just months ago. This may have an impact on NFT platform and protocol creators across all blockchains.
⛔️ ERC-721 Patent Infringement
The interesting thing here is not only the whole patent process, but the timing of when ERC-721 was created. According to Wright, ERC-721 was created 6 weeks after the patents became publicly known. The patent was filed February 2016, but due to the “18-month secrecy period”, it only became public knowledge in August 2017. Interesting, no?
Since blockchain, let alone NFTs, have brought up a lot around data rights - and now IP infringement
- it’s safe to say that patents are going to be bringing up a whole lot more for this Wild West industry. If you’re not familiar with the blockchain patent wars, have a read of this post
to get clued up on why it will matter over the next two decades (and yes, this will impact the NFT space too).
🦉 Moon Birds
Speaking of NFTs, a new market entrant (Moonbirds
) has completely shifted how people in the industry think about NFTs. The reason for this is because of the transparency around the actual fund-raising mechanism
NFTs are enabling for startups. To date, most NFTs have been selling “digital collectibles” but, in reality, they’re being used as a way to simply raise funds for projects. Have a read of this thread
to dive deeper.
My main concern for folks is that, since NFTs are essentially becoming a fund-raising channel, creators still have to be very careful about securities and crowd-equity laws. This trend has come before, in the form of crowd-funding and crowd-equity, almost a decade ago. The only difference here is the “technology” being used to raise funds. Noting this, those who get in early may still be able to benefit from the ambiguity and attention. But I do expect things to get tighter.
Finally, NFT and physical products. I bring this up because there’s been a rising trend of NFT projects looking to merge physical products and merchandise to bring even more value to NFT holders. The reverse is also happening where traditional businesses are looking to NFTs to extend their brand reach and increase revenue channels - from coffee
, to shoes
, to deodorants
. Pay attention here - because it’s a good thing for digital and physical to merge. As the next generation starts shifting to valuing their digital lives more than their physical
, it will be important to use technology to bridge those gaps - so that we don’t forget or lose relationship with our physical world.
What others trends have you seen emerging in this space? Would love to hear! Just hit reply or comment directly to this newsletter in the web version.
George Siosi Samuels | Managing Director