New technologies making use of blockchains and smart contracts have been considered an efficient and innovative way to achieve the goal of effective copyright protection in the digital market. It is impossible to deny, however, that these innovative technologies raise serious questions about their compatibility with international, European, and national legislative frameworks, at least if we compare them with the original and most widely-used blockchain model (i.e., the so-called permissionless blockchain). Indeed, permissionless blockchains create a “law-free zone” resistant to any subsequent modification and judicial intervention. In this general context, this chapter aims to analyse the pros and cons of using blockchains and smart contracts in the context of copyright. It will also attempt to investigate possible legislative solutions at the national and supranational levels aimed at encouraging the use of these innovative technologies to the extent they are compatible with the existing regulatory framework.
TopIntroduction
A constant variable in the history of copyright is its need to adapt to technological challenges, and copyright has always responded with great flexibility and expansive capability.
Technological innovation in recent years, especially in digital reproduction techniques and the development of the Internet, has severely tested the very survival of authorship exclusivity, which – albeit as a result of heated debates (Lessig, 2004) – has nevertheless been reaffirmed and probably also strengthened. It is a widespread and acceptable opinion that, since the end of the 1990s, the approach of the legislator – at the international, European and national level – has been directed towards a powerful reaffirmation of the proprietary paradigm of copyright and related rights in the digital environment, as evidenced in particular by the two WIPO Treaties of 20 December 1996 (WIPO Copyright Treaty–WCT and WIPO Performances and Phonograms Treaty–WPPT), as well as in the European context by Directive 2001/29/EC of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (Pila & Torremans, 2019; Musso, 2018).
After years of using the Internet and digital reproduction techniques, it is almost superfluous to enumerate the possible critical issues related to the protection of copyright and related rights on intellectual works in the digital market: intellectual creations, once they are placed on the network, are potentially the subject of endless perfect and identical reproductions, and moreover, subject to a global dissemination that is difficult to stop.
Thus, the main demands of rights holders in view of the potential circulation of their works on the Internet could be summarised as follows: (a) prevention of illegal uploading of the work, if it has already been disseminated off line; (b) protection against duplication and/or alteration and/or further dissemination, if the creation has already been distributed on line; (c) reduction of transaction costs related to the stipulation of licences with users and/or providers of online services; (d) monitoring of the exploitation of the licensed work for the purposes of quantifying any royalties, as well as any other forms of fair compensation provided for by law.
In this perspective, it is significant that at the legislative level, the answer to the need to protect copyright in the light of new technologies has also been found in technological tools, according to the well-known maxim that if the problem is the machine, the machine itself will provide the solution (Clark, 1996; Lundblad, 2002).
This has come about especially through the recognition of the full legitimacy of “technological measures” and “electronic rights-management information” (Articles 6 and 7, Directive 2001/29/EC). However, despite the presence of very stringent and even anticipatory protection legislation, these technological tools – often jointly identified under the name of DRM (Digital Rights Management) systems – have not been fully successful in providing effective protection to rights holders, often due to their high costs, implementation difficulties, rapid obsolescence and related ease of circumvention by users and malicious hackers (Finck & Moscon, 2019; Savelyev, 2018; Tresise et al., 2018).
Finally, the birth and increasing adoption of the innovative technology known as blockchain, especially in combination with the use of smart contracts, has raised a chorus of voices welcoming it as an efficient way of protecting copyright on the Internet: the relative ease of use, the generally low costs, the total disintermediation and, above all, the substantial unassailability by unauthorised parties make the blockchain – in its main applications – capable of overcoming the main critical aspects of protecting copyright holders and the online use of their intellectual works (for a general overview, see Tan, 2020).
Although we are aware of the challenges posed to legal scholars by the high level of technicality of the subject matter, in the following paragraphs we will attempt to highlight the potential consequences, both positive and negative, deriving from this revolutionary mode of circulation of intellectual works.