top of page

NFTs, Blockchain and Copyright

By - Aditya Sharma

NFTs, Blockchain and Copyright

We all use social media; we all are digitally equipped nowadays. Nowadays, many wonder about the assets which are surfacing over the digital world, the so-called “NFTs”. on one hand, there is a group of people who know the NFTs and try to invest in them, however, there is also another group, in which people don’t have any knowledge about the NFTs, but then also are attracted to them and invest in them. The first scenario depicts a situation in which the investor has the knowledge and can culminate his knowledge into some fruitful results. Contrary to the first case, in the second case, it is very likely that the investor with less or NFTs COPYRIGHT no knowledge is deemed to lead to a situation where he either faces complete loss or gets misled for the actual price which he could have been entitled to.


To understand NFTs, information about Blockchain technology is a must. Blockchain was first developed as a research project back in 1991, however, with its widespread implementation through bitcoin, it became well known around the globe in the year 2009. Blockchain in simpler words can be described as a database which keeps the information about each transaction happening through it cryptically, to avoid any kind of interruption or unauthorised change in the records. Each record of any transaction, called ‘Block’, which happens in a blockchain contains crucial information like the time of its occurrence, etc. and a record of its previous block, which results in a structure similar to a chain. The following figure is a representation of a blockchain:

In the above representation, each block is interconnected, since each block contains information about its previous block which is called a “hash”. Blockchain is a robust structure which often opens in the public domain but is operated and managed by the peer-to-peer network (networking in which the workload is distributed among individuals and each one of them has authority and privileges in the same sense and way). Blockchain is considered to be very secure as no one can edit the information of transactions unless each block is edited (which is practically impossible as of now). Because of this property only, blockchain is immune from hacking.

However, the process doesn’t end with the entry of the transaction, there is also a validation process which is done by the individuals of a ‘peer-to- peer network’ by the medium of solving certain specific types of equations to confirm the the transaction.


Every time a transaction takes place, all the steps are chronologically followed to give effect to the transaction.

  1. A new transaction takes place.

  2. This transaction is then sent to a network (peer-to-peer) all across the globe, to verify it.

  3. By solving the equation, the transaction is confirmed (there are instances where more than one individual tries to solve the equation to verify the transaction, in this case, the first one to solve the equation will be considered and will get his share).

  4. These transactions, once confirmed, are clustered in form of Blocks.

  5. These blocks are then chained together by entering “hashes” into them.

  6. The transaction is completed.


Let’s suppose there is a certain company, XYZ Ltd., which deals in the manufacturing and supply of certain goods. All the computers in the firm are interconnected and are under one roof only, which performs all the required tasks of the company (from designing to keeping sales records). One day, a fire breaks out in the firm causing damage to computers. In this case, the most probable outcome is either loss of data or the data gets corrupted. Now let’s consider the same scenario but with a variance in that the company uses blockchain technology to store its records. This time even if the computers get damaged, there will be millions of copies which were spread all over the world through blockchain, which the company can recover. (In this case, only the company has the authorisation to decrypt the data and use it as per their needs).

Blockchain spreads the data to databases of various nodes over various locations, which do create multiple records but also at the same time make an impenetrable system. Even if one tries to change information contained in one block, no other block will be changed and at the same time will detect the change and will also pinpoint the block in which the change occurred.


The first step in understanding NFTs is to learn the difference between two terms which are fungible and non-fungible. Fungible items are those articles which can be interchanged with one another by the way of similarity between them. These items are identical to one another. While non-fungible items are unique in themselves and cannot be interchanged. NFTs, as the name suggests, provide a medium through which one can identify the uniqueness of a virtual asset. To simplify it further, let's suppose there is a painting drawn by Mr. X on a canvas. Mr. X is a renowned painter all over the world and his paintings are sold in millions. One Mr. A buys X’s painting for one such hefty price. Now when the painting got delivered to A, his neighbour Mr. G visits his house and comments on the painting that it was fake and the money for which A brought it was not at all justified and was 100 times more than it was supposed to be. In this case, the asset is a real asset and not a virtual asset, therefore, the originality of the painting can be proved beyond doubt by thoroughly studying the brushing strokes, colour design, signature of the artist on the painting, etc. through these means, it is possible to identify the originality of a real asset. Now supposing a parallel situation where A buys the painting by X but this time the painting was a digital art drawn on a digital device (to reduce complexities, let's suppose it to be an iPad). In this situation, the moment art leaves the domain of artist’s to be viewed by anyone all over the globe with just one click, proving its originality becomes almost impossible since anyone on the internet can copy it by downloading it and again publishing it. Here, being a digital art, there is no way one can tell the brush strokes and all.

In the later situation cameos play the role of NFT. NFT by providing a unique tag on the original art, helps others to rest assured about the originality of the asset. NFT is a medium through which a person can identify whether the art he brought was from the same artist he expected or not. NFT works on the principle of copyright, through which it gives exclusive rights to its rightful owner for the art’s sale and distribution. Every person has a right to develop his unique piece of art. But in today's world, anyone can copy the art of another and use it for his advantage and to prevent these copyright laws were enforced.

Copyright laws provide that only the rightful owner of an asset should get benefit pertaining to its sale distribution etc. if another person tries to do such an act without the owner’s permission, then he/she shall be held liable. Similarly, NFTs provide the basis for these copyright functionalities to protect the rights of a lawful and valid owner.

There are also other various applications of NFTs which are now surfacing like the websites which provide you ownership of virtual lands. However, their utility in a person's life is still a mystery as to what can one do in a virtual land in which he can’t do anything in real life. There is also another downfall of it ie each website has its virtual world which provides the same land. This implies that multiple people can own the same virtual land though through different websites.

NFTs are not just avatars roaming all over the internet as we see today. There is an in-depth application, which lies within it, which when explored and utilised to its maximum can open various new domains of the virtual world.


1. The Copyright Act, 1957 (14 Of 1957)

2. De Filippi, Primavera,, Blockchain and the Law: The Rule of Code, (Harvard University)

17 views0 comments

Recent Posts

See All


bottom of page