Buyer of "Pepe the Frog" NFT files US$500,000 lawsuit after creator releases identical NFTs for free
NFTs, short for non-fungible tokens, are certainly one of the more peculiar digital trends that are based on the blockchain technology which also gave rise to cryptocurrencies like Ethereum. However, the tangible value of NFTs remains highly disputable, which is now highlighted by a new lawsuit filed in the US.
According to a report by Kotaku, Halston Thayer won a US$537,084 auction for an NFT showing the controversial meme figure "Pepe the Frog", which has mostly been associated with memes from the alt-right movement in the United States. The NFT auction in question took place last October and was conducted by the frog's creator Matt Furie and his organization called PegzDAO.
In the auction, the organization apparently disclosed the existence of 99 additional NFTs with the identical "Pepe the Frog" image, but allegedly insisted that those would remain in possession of PegzDAO. Therefore, the affluent buyer paid over half a million dollars in crypto assuming that he would receive a unique NFT in return. But as it turned out, the organization ultimately released 46 identical and completely free NFTs only a few weeks later.
Thayer has now filed a lawsuit and claims that the value of his NFT dropped significantly due to the release of the aforementioned free additional "Pepe the Frog" NFTs, while he also accuses the creator and his organization of unlawful business practices. However, it has to be noted that buyers do not acquire the legal copyright of their NFT's image. In the end, this bizarre incident and legal conflict once again underlines the intangible value and sometimes inexplicable price of non-fungible tokens which can either be worth a fortune, or barely anything if they are not unique.
Kotaku, Image: PegzDAO