Opportunities and dangers for public institutions in dealing with NFTs

A current legal dispute over NFTs created from the works of the great photographer August Sander raises pressing questions about art in digital space and on the blockchain. Who owns the legacy of one of the most important photographers? Who can use it and how? The conflict shows the legal tensions that arise for museums, foundations, artists and archive administrators when dealing with NFTs.

The NFT boom: examples of the use of NFTs in the context of cultural institutions

Since the beginning of the NFT boom, many actors in the cultural sector have been considering what they can, may and must do with their works in connection with NFTs (digital certificates of authenticity). Prominent examples were the Uffizi Gallery in Florence, which created and sold a Michelangelo painting as an NFT as early as 2021, or the Belvedere Museum in Vienna, which fractionalized Gustav Klimt's "Kiss" just in time for Valentine's Day, i.e. divided it into 1,000 authorized individual parts, and for offered sale.

Both institutions used NFTs as a means of fundraising and marketing. Accessibility and participation, which are to be achieved by making the works available on the blockchain, are often mentioned as advantages. The Cologne gallery owner Julian Sander had this goal when he wanted to immortalize the entire archive of his great-grandfather, the photographer August Sander, on the blockchain in spring 2022, although the copyrights belong to a non-profit foundation - and thus promptly solved the first major public legal dispute about NFTs in Germany.

Current legal dispute: Use of the works of August Sander

The controversy concerns the relationship between NFTs and rights of use in the sense of German copyright law and serves as a prime example for public cultural institutions and foundations that want to avoid mistakes in dealing with art and NFTs.