UK Gov to Include Crypto Assets in Financial Services Bill
Updates for the crypto asset world, as the UK government intends to include crypto assets in the Financial Services Bill. But what does this mean for you?Learn More
May 4, 2022
2022 has already blessed us with exciting developments in the non-fungible token (NFT) world – from Paris Hilton serenading Jimmy Fallon’s Late Night Show audience with NFTs, to Snoop Dogg announcing a new token collection to be launched on Cardano. Suffice to say,, it’s kicking off out there. Most recently, a landmark case on NFTs has caught our attention. Brought before the UK High Court by owner of two “Boss Beauties” NFTs, Lavinia D.Osbourne, these digital certificates of authenticity have officially been designated as legal property in the eyes of the law. This is crucially distinct from cryptocurrency, another type of cryptoasset that has been the subject of litigation, and highlights huge progression in the recognition, regulation and advancement of blockchain technologies.
This party of portraits is a unique collection of 10,000 NFTs (which sold out within an hour of being published on popular NFT marketplace, OpenSea!). The NFTs are certainly artistic, but also have utility – holders can access exclusive events, free books, licensing fees and more! Beyond the individual perks, Boss Beauties (BB) have made it big in the media, featuring on TV, radio and in magazines, and became the first known NFTs ever to be displayed at the New York Stock Exchange. Coming soon, BB are exploring partnerships with the likes of Hugo Boss, Barbie and Marvel. There’s something for everyone here, and BB encourages all audiences to get involved to support the project.
Absolutely smashing the blockchain and NFT industry, Lavinia D.Osbourne is a pioneering innovator who works hard to promote female participation in the tech world. This has included joining us on one of our many webinars, where Lavinia took the time to explain her experience in the world of NFTs. One of the ways she is trailblazing ideas is through her education and networking organisation, Women in Blockchain Talks. Described as “an agent for change in blockchain” Lavinia is an award-winning entrepreneur ready to fight the good fight for NFT recognition in this fast-evolving and exciting space.
Back to the case. In January this year, Ms Osbourne discovered that two of her beloved Beauties had been unknowingly, and without consent, removed from her MetaMask wallet (that is, the digital crypto wallet that contains NFTs, cryptocurrency etc). Lavinia tracked down the NFTs in partnership with Mitmark, a security and intelligence firm, to two separate wallets. Like a boss. Now for the tricky part. How does one get an NFT back from thieves? Before this case, it was incredibly difficult for victims of NFT theft to retrieve their assets, as the technology is still developing, and regulators have remained hesitant to get involved – until now!
For Lavinia, it was time to get the law involved. Ms Osbourne took her case to the UK High Court and appealed for an interim freezing injunction – this order is a type of legal “pause” button, which preserves the property in question by prohibiting the dissipation, (further transfer or sale) by the potential defendant, of the assets during the lifespan of the case. A freezing injunction is widely recognised as quite a draconian (i.e. old fashioned and harsh) remedy and has been described as a "nuclear weapon" of the law (Bank Mellat v Nikpour (1985) FSR 87). The court will only exercise its discretion to grant this kind of order where it is justified and convenient to do so.
In precedent-setting development, the court granted the application and froze the assets on 10t March. It is assumed that, given the identities of the wallet-holders are unknown, the injunction was granted against “persons unknown”. This again highlights the extremity of the case, as the courts are not prone to granting this order, given its intensity of effect, against an unidentified defendant without great limitations. The big freeze was then extended on 31March at another hearing, the impact of which will be that the NFTs continue to be held untouchable until the proceedings end, and a judgment has been obtained. We’ll be watching this space for the much-anticipated outcome.
In a quote following the conclusion of this groundbreaking case, Lavinia said:
“Women in Blockchain Talks was founded to open up the opportunities blockchain offers to anyone, regardless of age, gender, nationality or background. This case will hopefully be instrumental in making the blockchain space a safer one, encouraging more people to interact with exciting and meaningful assets like NFTs.”
We certainly hope to see more doors open to the possibilities of safeguarding NFTs through legal recourse – perhaps intellectual property protection will be next?
If you need help drafting NFT terms and conditions, are interested in training, or want to contact us about anything else, you know where to find us.