NFTs and Secured Transactions
Just what are the “cool kids” up to these days? Creating, marketing, and selling NFTs (and if you call them “non-fungible tokens” and not NFTs, you are most definitely not cool). It has only been about 18 months since Twitter founder Jack Dorsey’s first tweet sold as an NFT for $2.9 million. And the total value of NFTs sold in 2021 was more than $17 billion. So NFTs are clearly valuable and marketable treasures, but how might parties attempt to securitize and perfect their interests in these digital assets? In our previous client alerts in our series about NFTs, we looked at what NFTs are and their tax considerations. In this, the latest edition, we explore NFTs and secured transactions. An NFT is a unique blockchain token. It is non-fungible, which means that it is not replaceable or interchangeable. NFTs were designed to prove ownership of unique digital or physical assets, and they are ideal for managing digital versions of existing physical assets (art, trading cards, other collectibles, etc.). The fact that NFTs are “stored” on a blockchain appeals to investors and collectors; they cannot be replicated. And title to an NFT can be held anonymously.
Full story : NFTs and Secured Transactions.