Copyright & AI & NFTs

Oh my!


Copyright & AI & NFTs

Back when the printing press first came into use, copyright was simple and sweet. Over time, copyright has evolved into a complex area of law. Now, add in new developments, like NFTs (non-fungible tokens) and AI (artificial intelligence), and copyright issues become exponentially more complicated, as well as philosophical.

Copyright is a principal means for protecting creative works. Creativity and artistic expressions have historically been a big part of what separates us from machines. For example, the U.S. Copyright Office takes the position that copyright can protect only material that is the product of “human creativity.” However, if you have had a chance to try ChatGPT or Dall-E, you might find these AI programs give the illusion of being creative. So, what makes human creativity and what does copyright have to do with it? We will try to make sense of this new wave of digital revolution and its impact on copyright against the philosophical question of “human creativity.”

To unpack the copyright issues in the context of digital artistic works, let’s start by unpacking NFTs. While NFTs have come to be associated with specific collections of very expensive digital artwork (think Bored Ape Yacht Club), the artwork and the underlying NFT are actually separate elements. The NFT is a unique digital identifier that is recorded on a blockchain, which can be used to certify ownership and authenticity. As a piece of information, the NFT itself is not subject to copyright protection, but artwork associated with the NFT can be.

In practice, NFTs are usually created using collections of artwork, involving thousands of individual works. That collection of artwork is frequently generated with the assistance of a computer, which may or may not involve the use of AI. If a computer or AI is involved in the creation of the artwork, there is an issue as to whether copyright subsists at all. Many countries, including the U.S. and EU, have taken the position that a work that is generated purely by AI cannot be the subject of copyright protection. However, AI-assisted works may be copyrighted. For example, the Canadian IP Office recently granted registration for SURYAST, an artistic work identifying AI as a co-author.

Thus, whether an artistic work is protected by copyright or not depends on how much “human creativity” was involved. If there is not enough human involvement, the resultant artwork is not protected by copyright, and anyone may freely reproduce it. As a further wrinkle, even assuming there is sufficient human involvement to give rise to copyright, creation and transfer of the NFT generally does not include a transfer of copyright (although this is fact specific). So, the owner of the NFT may well not own copyright in the underlying artistic work represented by the NFT. This leaves the question of what exactly the NFT is rather muddy.

As we approach the word limit, we fear that we have made little sense of copyright, AI and NFTs, although we have pointed out some issues to consider. However, this particular intellectual exercise and the various feelings, e.g., curiosity and frustration, that are associated with it are perhaps what ultimately make us “human” lawyers.

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