NFT Provenance Problems

Provenance is a key term in the art world.  Is a piece of art what it purports to be?  Tracing where it came from and who created it will determine validity and worth but this is not always straightforward.  NFTs ought to be easy to track and trace but they are as susceptible to copies and homages as traditional art. 

One of the core aims of NFTs was to protect digital art authors.  The token trail proves who minted the original file and what transactions it had undergone since its creation.  Broadly this would be record of where the art came from and who bought and sold it.

The loophole in this network is that it records the minting of the NFT not the creation of the underlying file.  It is possible to take a copy of a file, such as an image, mint and sell it as a NFT.  OpenSea has become a major market and showcase for NFTs but admitted on a Tweet of 27th January 2022 that 80% of its content was plagiarised, fake or Spam.   Their problem is that they allow art to be showcased with no up-front costs.  The NFT is only minted when a sale is agreed.  A common source of stolen art was the site DeviantArt who have now launched their Protect engine to look for matches within the Ethereum, Klaytn, Polygon, Arbitrum, Optimism, Palm, Tezos, and Flow Blockchains.  It is up to the user to then ask for that art to be removed from the Blockchain with no guarantee of success.  OpenSea itself is also introducing image recognition software and human interaction to identify duplicate images or ‘copymints’.

Any solution needs to consider look-alike creations as well as direct copies.  This is a woolly area to police.  Part of any artwork is the idea, concept and style as much as the creation of the product.  At what stage does an artwork become a new concept rather than a copy? Within the art world a piece in the style of another artist still has value although probably considerably less than an original.  With physical art these ‘homages’ and even outright fakes still require some effort to craft.  With a digital source the time invested in such a process would be negligible.  For example save a copy, flip to the mirror image and call it done.  This was exactly the business model of both the PHAYC and Phunky Ape Yacht Club (PAYC) collections, based on the Bored Ape Yacht Club (BAYT) a very successful and expensive NFT collection.  While it might be argued that such an effort is an homage or a parody of the original; OpenSea did not agree and banned both collections. As of January 2023 PHAYC is still listed on Rarible with starting prices from 0.12 Ethereum but there is no record of any sales of the collection on that platform.

NFT investigation needs to be part of the brand protection strategy of organisations dealing in the crypto field.  Art that is similar to any original creations might benefit sales.  The derived art can drive interest in the brand.  If part of the NFT project is to promote a brand the copies are fuelling the original project aim.  When these copies are exact and competing for the same buyers then there is a problem both in loss of sales and trust in the original artwork and their creator.  Digital files have a timestamp but that is based on the machine creating or modifying them and is easily spoofed.  NFTs have the advantage that when minted or even loaded onto a platform such OpenSea or DeviantArt gain a trustworthy timestamp.  This provides evidence for tackling copies but might expose the content of a campaign too soon before all the marketing details are in place.

A buyer should research before investing in a NFT to see where and when an image has been uploaded, linked to or minted.  In some cases a look-alike product may be acceptable but the cost should reflect that it is not an original work of artistic creation.  Where the seller is clearly fraudulent they will pressurise the mark to hand over funds before they have the time to investigate the product.  Any promise of time limited or short term gain should be viewed with suspicion.

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