Legitimize Implementation of NFTs Through IP Licensing

Non-Fungible Tokens, or NFTs as they are more commonly known, create unique opportunities for businesses. The sale and exchange of these digital assets soared in 2022, to the tune of 101 million tokens sold last year.

These transactions show that, despite skepticism, NFTs are gaining more mainstream acceptance. In business, companies are often using these as a marketing tool as much as they are using them as investments. We’ve seen massive corporations like Nike, Budweiser, and McLaren make large NFT commitments. Businesses that aren’t at least considering the possibilities may fall behind.

Our firm doesn’t offer investment advice. Our focus lies more in understanding the law and advising companies when new opportunities present themselves. We have previously discussed how intellectual property laws are adjusting to the advancing digital asset market.

One of the biggest questions surrounding NFTs is how the licensure of incorporated works would apply. If your business is considering tapping into the Non-Fungible Token market then there are some intellectual property considerations that must be made.

If Creating NFTs, Secure Licenses for Non-Original Works

There have been numerous lawsuits filed against NFT “creators” who have used the work of others to generate tokens. These creators attempted fair use claims, but legal consensus leans toward requiring a license from the original creator or current rights holder in order to use someone else’s intellectual property in an NFT.

If you are able to secure a license to reproduce the work as a digital asset that can be sold and exchanged as an NFT, you create a valuable asset for yourself and your business. It’s imperative to work closely with an attorney familiar with drafting and reviewing license agreements to ensure the license says what you need it to and believe it does.

Require License Agreements for Future Buyers

Securing a license is step one. Ensuring that future buyers of the NFT understand and agree to the terms of the original license is a whole other aspect of this you cannot afford to get wrong. If your plan is to ultimately sell the NFT and allow it to be resold, the license agreement must extend beyond just an exclusive agreement with you and allow future buyers to agree to the same terms.

As your NFT moves from buyer to buyer, each individual will need to agree to the license agreement. Ensuring a form to sign off on the agreement is included even when the NFT is far removed from your original creation is imperative to protect your rights and avoid liability.

The Future of Business Law is Here

These modern, evolving assets require the attention of a law firm that understands and keeps up with applicable law. At CLARK.LAW, we are constantly learning new ways to apply the law and ensuring businesses are equipped for growth.

A data-driven approach to law allows us to position our clients for an evolving marketplace. Your marketing and investments can benefit from NFTs and similar digital assets. Contact our team if you are already in the NFT market or considering getting in and need help navigating intellectual property matters related to them.

The following two tabs change content below.


At CLARK.LAW, we’ve built a different type of law firm. Our attorneys and staff have impressive educational and professional experience – but, unlike traditional law firms, we embrace modern technology to create efficient workflows and processes. Today’s business leaders should have access to high-quality legal guidance without subjecting themselves to the waste and excessive overhead that plagues traditional law firms.

Latest posts by CLARK.LAW (see all)