A UK parliamentary committee has recommended that the government protect artists from copyright infringements associated with non-transferable tokens (NFTs) and mitigate the negative effects of the release of digital content by sports organisations. The Culture, Media and Sport Commission warns of the threat to artists’ intellectual property rights due to the simplicity and speed of creating NFTs. The commission is also calling for the delegation of cryptocurrencies and for sports teams to be banned from selling them to fans.

• A parliamentary committee comprising members of both parties recommended that the UK government protect artists from infringements of copyright associated with non-exchangeable tokens and mitigate any possible negative effects resulting from the release of digital content by sports organisations.
• The commission also demanded that cryptocurrencies be outlawed and warned against sports teams or leagues developing cryptocurrencies to sell to fans.
• The Commission concluded that the use of football tags should be explicitly excluded from any measurement of fan involvement in sport, including the forthcoming football regulations.

A parliamentary committee made up of members of both parties recommended that the UK government protect artists from copyright infringement associated with non-exchangeable tokens and mitigate any possible negative effects resulting from the release of digital content by sports organisations.

Members of the Culture, Media and Sport Committee issued a press statement on 11 October drawing attention to the growing threat to the intellectual property rights of artists arising from the ease and speed of creating NFTs compared to the lengthy procedures required to enforce copyright.

The head of the committee, Dame Caroline Dinenage, highlighted that artists face risks of theft of their work and its unauthorised distribution, while there is a growing threat from false advertising that exposes investors to additional risk in the already risky world of NFT.

In a companion report, the Commission suggests that a solution to these problems could be for the government to work with NFT commerce platforms to develop a code of conduct. Such a code would aim to protect creators, buyers and sellers from potentially fraudulent and infringing content distributed on these platforms.

The Commission also expressed the view that regulation of cryptocurrencies was necessary and expressed concerns about the activities of sports teams and leagues in relation to the development of cryptocurrencies to sell to fans.

The Commission found that some sports teams emulate the model of English football clubs, such as Manchester City and Tottenham Hotspur, which introduce , “supporter tokens” available to their fans and club members. While the purpose of purchasing these tokens is to provide exclusive rights and benefits, the Commission noted that this was not always the case.

“Despite the volatility in pricing and reservations among fan groups, we are also concerned that clubs may in future present tokens as some form of fan engagement” – the study stated. The committee noted that fans who were unaware of the risky nature of the assets and may suffer financial losses as a result of token volatility.

Additionally, the Commission believes that sports teams are promoting unstable cryptocurrencies in an attempt to raise more funds from dedicated fans. These programmes often promise privileges and benefits that are not fulfilled in reality.

In light of these observations, the Commission recommended that the use of fan tokens should be explicitly excluded from any measure of fan engagement in sport, including future football-related regulations.