Description
By Catherine Zhu and Louis Lehot
With the growing interest from consumers and asset managers, investors as well as entrepreneurs interested in digital assets, we have created this checklist for monetizing items with unique artistic content characteristics through nonfungible tokens (NFTs).
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Attorney Catherine Zhu of Foley & Lardner LLPWe have seen businesses that aggregate content to be monetized on an NFT, while others mint the tokens or build NFT marketplaces, and many more that intermediate payment transactions between the creators, the licensors, the marketplaces, and the buyers, the sellers and the exchanges upon which they trade.
Each of these types of businesses, and the transactions in which they participate, will need to consider the legal ramifications of still-developing law, policy and regulation applicable to each link in the chain of NFT commerce.
Attorney Louis Lehot of Foley & Lardner LLPBut first, a quick primer: An NFT marketplace is a platform that connects content creators with NFT buyers with NFT sellers. Sellers mint NFT tokens with the created digital asset in this platform, and buyers can browse listed assets and buy or participate in an NFT auction. There are primary and secondary sales of NFTs in the marketplace with differing transaction costs depending on how the marketplace operates and who facilitates the sale.
With NFTs expanding into the mainstream consciousness, what are some key legal, policy and regulatory considerations you need to be aware of?
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