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The boundary between plagiarism and parody is being tested by a pair of non-fungible token projects. The PHAYC and Phunky Ape Yacht Club collections have been banned by Open Sea because they are based on the same idea: selling NFTs with mirrored but otherwise identical versions of high-priced Bored Ape Yacht Club avatars. The dueling projects are selling their apes while avoiding bans from other marketplaces, which is an example of how the NFT world handles copied art.
The most expensive NFT is the one from Bored Ape Yacht Club, which sells the cheapest ape for $217,000. The associated ape picture can be copied or modified by anyone. PayC and PHAYC can associate their BAYC avatars with cryptocurrencies and resell them.
NFTs allow you to buy and sell ownership of unique digital items and keep track of who owns them. NFT stands for non-fungible token, and it can contain anything digital, including drawings, animated GIFs, songs, or items in video games. The NFT can be one-of-a-kind, like a real-life painting, or one copy of many, like trading cards, but the blockchain keeps track of who has ownership of the file.
Nyan Cat and the "deal with it" sunglasses are being put up for auction, as NFTs have been making headlines recently. There is a lot of discussion about the massive electricity use and environmental impacts of NFTs. If you still have questions, you can read through our FAQ.
The mission statement for PAYC was vague and denigrating, and it was announced in December. Earlier this year, it called back to a project called CryptoPhunks, which flipped and resold expensive images. Early arrivals could get left-facing apes for free starting December 28th, while others paid a fee.
The project was described on the website as a limited NFT collection where the token itself offers no membership and no allegiance. One PHAYC community member said that the project was a satire on the current state of NFTs and members of the NFT community who might be taking the NFT market a little too seriously.
PAYC founder referred to PHAYC as a "cash grab fraud project" after they fought over which one was the authentic Bored Ape Yacht Club ripoff. PHAYC charged people to mint its apes, and it took in around 500 ETH in sales. PAYC earned around 60 ETH from its paid sales.
Both projects may be considered dicey. It is common for NFT lineups to use similar names. Yuga Labs owns the copyright on its ape images, and PAYC and PHAYC have been kicked out of OpenSea for violating its rules against copyright infringement. PAYC was removed from competing markets Rarible and Mintable. PAYC and PHAYC could potentially defend their apes as fair use if Yuga Labs files a formal legal complaint. There is very little legal precedent surrounding NFTs.
Yuga Labs didn't respond to a request for comment on whether it might file a complaint, and PHAYC didn't respond to a message about the issue. PAYC told The Verge that it has not received any legal threats from the BAYC team.
Both projects are trying to make their apes tradeable online. NFTs are supposed to live outside of a given platform, but markets like OpenSea have become huge problems because of the simplification of the selling process. While the sites have hosted a lot of NFT projects based on stolen art, they have banned individual NFTs that were stolen from their owners, and de-listed some NFTs that were based on stolen art. The PAYC and PHAYC have both said that they are working on alternative marketplaces that can sell left-facing apes.
