Decentralized Metaverses are currently only decentralized on paper, according to a new Galaxy Digital report on NFT licenses.
The authors of the report published by Galaxy Digital said the following on the subject:
“If these issues are not addressed now, so-called decentralized Metaverses will not differ significantly from those built by Web2 giants like Meta (Facebook).”
In other words, these products that you invest in as decentralized are actually highly centralized.
Galaxy Digital’s Report Mentions The Sandbox, Decentraland and Bored Ape Yacht Club Projects
The report is intended to understand how real-world copyrights and trademarks are perceived in the Metaverse environment. The Sandbox and Decentraland cryptocurrency reviewed the Metaverse license agreements of the companies.
It concluded that both companies did a “good job” attempting to transfer ownership of user-generated content to their users, but in both cases, the companies retained all intellectual property related to the sale of plots of land in their metadata, only transferring the usage rights to the NFT buyers.
However, even if users own the rights to user-generated content, there is no guarantee that a Metaverse administrator will support it in their virtual world.
Content moderation policies allow users to ban or remove their content regardless of the Intellectual Property rights of these platforms.
The following statements were used in the continuation of the report:
“For example, owning the rights to a custom character skin does not guarantee that Decentraland or Sandbox will allow this skin to be used in-game.
Where there is no third-party alternate world where you can embed your user-generated content, effective use of that content is subject to the permission of the metaverse administrator.”
The report also targeted Yuga Lab’s upcoming Metaverse project Otherside and its terrain NFTs Otherdeeds. NFT token holders have commercial rights for other Yuga Labs collections, such as the Bored Ape Yacht Club, while Otherdeeds does not.
“The Otherside agreement clearly states that acquiring Otherdeed NFTs does not grant any intellectual property rights,” the report said.
*Not investment advice.
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