Why Scandinavian companies have been quick to adopt NFTs
During the domain name boom around 20 years ago, some of the earliest adopters of domain registrations were companies within fast-moving consumer goods (FMCG), retail and fashion. Such businesses recognised this exciting new advancement for what it was – a new marketplace and potential revenue stream, basically, a new way to reach customers and sell to them. Although it took some time before the domain markets could be considered functionally stable, history eventually proved these early adopters right. Scandinavia, despite its relatively small size and population, remains home to many of the world’s largest and most recognised consumer brands in these sectors. Its population was (and still is) considered tech-savvy and, as a result, it is often disproportionally represented on the world stage when it comes to adopting and integrating new technology into everyday use.
Fast forward 20 years and non-fungible tokens (NFTs) are the new market craze, interest in them has skyrocketed and market value has soared from around $100 million in 2020 to approximately $22 billion in 2021. Once again, some of the earliest adopters are Scandinavian firms in the FMCG, retail and fashion sectors, but this time they are joined by organisations representing much of the digital space as well. Thanks to investment and supportive regulations, Scandinavia remains one of the most innovative regions in the world, certainly when it comes to IP registrations or filings. Big consumer-brands aside, it is also home to many well-known software companies, from video-game publishers and virtual engineering platforms to streaming services.
Scandinavia is in an enviable position when it comes to the digital marketplace, especially with regard to how such technology might be incorporated into everyday use. Much of society already operates comfortably as cashless, so the idea of other digital assets is a relatively easy one to grasp. Many Scandinavian firms are exploring monetisation opportunities from both sides of the market, with some actively adopting new revenue streams in the sale of virtual goods and others busy designing and building the worlds where such assets are being bought, sold and used. The emerging digital landscape offers boundless possibilities but related IP understanding, knowledge and enforcement options are all still in relative infancy. As such, companies will need to understand the concept of the metaverse and NFTs before they will be able to explore protection and enforcement opportunities.
Companies across the globe are already investing millions into the establishment and protection of NFTs related to their existing IP rights but the market is still a legislative wild west and rife with infringement. Experts predict that, as was the case for domain names 20 years ago, it will be many years before the market can be considered functionally stable and those who have just joined the discussion are increasingly finding that NFTs have already been registered using their protected intellectual property.
Although there is no formal dispute resolution process yet, there are technical means of monitoring for potentially infringing content and some takedown methods do exist, although they offer few guarantees for success. There are others in development and many of the larger NFT marketplaces are also introducing guidelines for sellers, including relevant procedures and controls. IP offices around the world are also slowly catching up and discussions are already taking place between legislative bodies on how NFTs will be classified. Are they purely digital goods or software, or should they form a sub-class within existing product classes? For now, we can only wait and see.
NFTs and the metaverse in one form or another are here to stay. Although many organisations and citizens in Scandinavia have been early adopters, the rest of the world is catching up, so, if you have not already, it is definitely time to start discussing how such assets and tokens should be incorporated into your existing IP and branding strategy.
This is an insight article whose content has not been commissioned or written by the WTR editorial team, but which has been proofed and edited to run in accordance with the WTR style guide.
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