The Metaverse is the latest craze on the internet. While many still do not know what the Metaverse is, some have already set up digital shops in the online Metaverse with turnovers outstripping the offline world.
In a new series of articles, we will explain what the Metaverse is, and what you need to know about IP protection in the Metaverse.
What is the Metaverse?
In simple terms, the Metaverse is an online 3D world that you can enter via the internet. It is essentially a 3D game that is always accessible and that can be entered by anyone around the world. Unlike a game though, the Metaverse is not pre-designed for you to play through levels, but is a digital world that depends on users entering, interacting and creating. There are no levels to play and the Metaverse will never end. While you can leave at any time, others will continue to interact, play, build, sell, and shop.
Much like in the real world, users are able to purchase (digital) land, products, and services in the Metaverse. Digital land can be used to construct digital buildings such as museums or shops for digital goods. Digital goods can be created, exhibited and sold on the Metaverse. Digital services may include professional services, education, and entertainment provided in the Metaverse. In the Metaverse, traders can opt to accept any kind of currency, including cryptocurrencies.
What is the Blockchain?
Essential to the Metaverse is the Blockchain technology. A Blockchain is a secure system of recording information in a way that makes it difficult or impossible to change or cheat the recorded information. A blockchain is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain. Hence, no one individual can gain control over or manipulate the system. Only verified transactions will be recorded and can then never be changed or deleted.
Initially, Blockchain technology was used to securely record transactions of digital currencies, so-called cryptocurrencies. There are numerous Blockchain networks, the most common being the Bitcoin and Ethereum cryptocurrency blockchains.
In recent times, it was found that Blockchain networks can do far more than just record cryptocurrency transactions. Since Blockchain networks can securely record any kind of digital transaction, they allow recording transactions for really anything, including digital media.
How does one ‘own’ things in the Metaverse?
Like in the real world, users are able to buy land and digital files in the Metaverse. These goods can be traded on digital exchange platforms that often accept both real money and cryptocurrencies.
You may wonder why you would want to use real money to pay for digital land or digital artwork in the Metaverse? Here, it is crucial to understand a relatively recent invention that allows users to securely own and trade digital goods, including digital land and digital files such as images, video and music.
Based on the blockchain principle, the so-called Non-Fungible Token (NFT) offer a secure way to establish ownership of digital goods online. Essentially, NFTs are unique software codes that are recorded on a decentralised and public blockchain. By attaching an NFT to a digital file, this digital file becomes forever identifiable and unique. While digital files can still be copied, NFTs provide a secure way to prove ownership of a file. NFTs have opened up new opportunities for digital creators to sell their creations online.
IP Protection and the Metaverse
It’s simple: where there is trading activity, there are IP issues. For example, if one entity owns a trademark for real-life clothing, can someone else then use the same brand to sell digital versions of the real-life clothing in the Metaverse? Likewise, if one buys a digital image authenticated by an NFT, can the image then be commercialised by the owner, even if someone else owns a trademark that appears in the file?
Stay tuned as we will answer these questions over the coming weeks.
If you have any questions on how to protect your IP on the Metaverse, or if you are concerned that your brand/ logo is used by someone else to sell files on the Metaverse, feel free to contact us.