European Network | NFT cross-border perspectives on unprecedented regulatory challenges

Non-fungible tokens, or “NFTs”, have been largely in the media spotlight over the past few months, with significant projects developed in various industries. For example, their development in Metaverse projects is seen by many as strategic. NFTs are used by start-ups as well as incumbent players to develop innovative digital products and services, capable of generating new revenue streams and potentially reaching new client categories.

An NFT is a digital and cryptographic asset recorded on a blockchain, representing digital or physical items, which -unlike other digital assets that are usually interchangeable and fungible- has a non-fungible nature. The purchaser of the NFT is given a digital encrypted certificate that makes it possible to connect in a unique way to a smart contract realised on a blockchain platform and to subsequently access various prerogatives (such as access to a digital product, a physical product or specific services).

As this new NFT industry is growing rapidly, the question of the applicable legal regime is now becoming strategic. With this in mind, and to help market players develop their NFT projects in optimum legal comfort, the European network formed by Gide, Gleiss Lutz, Chiomenti and Cuatrecasas publishes this booklet that summarises the regulatory challenges for NFTs in their five countries of expertise, i.e. France, Germany, Italy, Portugal and Spain.