IP in the Metaverse

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The term “Metaverse” has gained a lot of attention in the past few years, moving gradually from the Sci-Fi world into, in our opinion, reality. The Metaverse is a result of advancements in technology and the impact of the COVID-19 pandemic on human communication. Its popularity peaked in late 2021 when Facebook changed its name to Meta. However, the decline in popularity has taken away the hype over time, and we are now in a more realistic position for a proper discussion. While the Metaverse presents opportunities for individuals and corporates, it also brings challenges in protecting intellectual property rights.

What is the Metaverse?


The Metaverse originated from Neal Stephenson’s 1992 science fiction novel “Snow Crash”, which described a shared virtual reality where people could interact with each other in digital environments. Today, the Metaverse still has different meanings according to different perspectives since it is still an ongoing project. It is a hypothetical universe of interconnected virtual worlds, allowing for a persistent and immersive digital experience. Moreover, it is a collective virtual shared space, created by the convergence of multiple virtual and augmented reality environments, as well as other digital platforms such as video games, social media, and e-commerce. As technology advances, the Metaverse will transform how we interact with each other and with technology, offering endless possibilities for entertainment, learning, and collaboration.

IP protection in general


In our economic system, protecting intellectual property is crucial for individuals and organizations who wish to safeguard their innovative ideas, creations, and products. One of the most effective ways to protect intellectual property is to obtain legal rights, such as patents, trademarks, and copyrights. Patents protect inventions, trademarks protect logos and brand names, and copyrights protect creative works. It is also necessary to maintain confidentiality and limit access to sensitive information. In addition, it is vital to actively exercise your intellectual property rights, such as taking legal action against infringement or unauthorized use. By taking these steps, you can safeguard your intellectual property and prevent others from profiting from your ideas or inventions.

IP in the Metaverse


As IP is tied to specific jurisdictions, the laws and regulations of a particular country often determine the ownership and rights to a specific asset. This has raised questions about where the Metaverse exists and which jurisdiction’s laws would apply to the ownership of digital assets within it. However, existing legal systems can regulate physical locations where the infrastructure for the Metaverse will likely exist, indicating that the Metaverse is not a mere castle in the air. Additionally, most NFT marketplaces that facilitate the sale and purchase of digital assets have strict policies against copyright infringement. These policies prohibit sellers from minting or selling art that they did not create. As the Metaverse continues to develop and expand, it will be important for individuals and organizations to establish clear guidelines and regulations around intellectual property to protect creators and encourage innovation within this new digital landscape.

We can also investigate the Metaverse as part of the gaming world, and gain some insights from existing IP issues there. In 2016, Solid Oak Sketches LLC filed a lawsuit against Take-Two Interactive, claiming that the tattoos on NBA players depicted in NBA 2K video games were copied without permission. Take-Two argued that the use of the tattoos was fair, and a federal court jury ruled in their favor in 2018 as the use of the copyrighted material was de minimis. Solid Oak appealed the decision, but in 2021, an appeals court upheld the ruling in favor of Take-Two.

We expect that IP protection will get more sophisticated than the Solid Oak case. The owner of brands or creators will increasingly face their brands or products appearing in unexpected ways, so it is essential to have multi-disciplinary teams manage their IP strategy and choose the right technologies to protect their IP.

Apr 24, 2023 by Winston Wan

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Equasia is an expert corporate advisory and business services firm with offices in Hong Kong, Shanghai and Singapore, helping clients to access, operate and grow in China and other Asian markets. We partner with entrepreneurs, investors, corporates, financials, startups and private clients.