2021 has seen NFTs, or "Non-Fungible Tokens," become
the centre of attention in the worlds of sport, investing and
blockchain. A catalyst for this rise in popularity is NBA Top Shot,
a new form of licensed digital collectibles from the NBA. More than
$230 million was spent on Top Shot NFTs during the last NBA season,
with the most expensive highlight of Lebron James selling for over
$200,000. In recognition of this large influx of capital and the
speculative nature of these assets, it is important to understand
the legal rights and obligations accompanying what the NBA is
selling and, more importantly, what purchasers are buying with
these NFTs.
What is an NFT?
An NFT is a digital file that is individually and uniquely
registered on blockchain. Blockchain networks authenticate, verify
ownership and ensure the tradability of NFTs. Unlike
"fungible" cryptocurrencies such as Bitcoin, each NFT is
unique and not mutually interchangeable. In other words, 1 Bitcoin
= 1
