The Culture, Media and Sport (CMS) Committee has urged government to work with non-fungible token (NFT) marketplaces to address the scale of copyright infringement in the art world.
In the committee’s latest report, NFTs and the Blockchain: the risks to sport and culture, published today (11 October), the cross-party group of MPs note that, while NFT sales may have peaked last year, their emergence has led to the risk of widespread copyright infringement.
The report explains creators' rights have been infringed in cases where work has been made available as an NFT without permission.
The process of having copied work taken down has proved time consuming and difficult for artists, compared with the ease with which NFTs can be minted.
In the report, the committee recommends government engages with NFT marketplaces to address the scale of infringement and enable copyright holders to enforce their rights.
It says government should work to introduce a code of conduct for online marketplaces operating in the UK - including NFT marketplaces - that protects creators, consumers and sellers.
CMS Committee Chair Caroline Dinenage said: “Traditional regulatory regimes have failed to protect both creatives and consumers caught up in the volatile new crypto world.
“Artists are at risk of seeing the fruits of their hard work pinched and promoted without permission while fraudulent and misleading adverts add an extra layer of jeopardy for investors involved in what is already an inherently risky business,” she explained.
“The government must make sure that everyone in the crypto chain is working to properly protect consumers and the rights of creators.”
The committee’s report also highlights NFTs and blockchains as having unique potential applications in arts and culture, such as encouraging artists to develop digital skills or creating new markets for artworks.