1) Where your NFT’s media lives

NFTs are entries on a blockchain ledger. The token itself stores:

• A unique ID (tokenId)
• Contract address
• Owner address
• Pointer (URI) to metadata file, often JSON

That JSON metadata then links to the actual asset (JPEG, video, 3D model). If the URI points to a
centralized server, the issuer could swap or delete it.

2) On-chain vs. Off-chain Storage

• On-chain media: Entire asset data stored directly in the contract immutable but expensive.
• IPFS/Arweave: Decentralized storage with content-addressing; resilient if pinned by enough nodes.
• Centralized CDN: Fast and cheap, but reliant on issuer’s servers.

3) What “ownership” means legally

Owning an NFT does not automatically give you copyright or commercial rights to the media. Unless
the issuer attaches an explicit license, you’re buying:

• Provenance and scarcity on-chain
• The right to transfer/sell the token
• Access to any perks gated by token ownership

Actual IP rights depend on the attached license terms (if any).

4) Royalties: promises vs. enforceability

“Royalties” in NFTs are typically percentages set in metadata or marketplaces. The catch:
on-chain enforcement isn’t native to ERC-721/ERC-1155. Marketplaces must voluntarily respect them.

• Some chains (e.g., Tezos) have protocol-level royalty standards.
• Ethereum relies on off-chain marketplace compliance.
• Royalty wars in 2023–2024 saw many marketplaces making them optional.

5) Common NFT License Models

• Personal use only: View, display, resell; no commercial exploitation.
• Commercial use: Freedom to monetize, sometimes with revenue caps.
• CC0 (Creative Commons Zero): No rights reserved; public domain equivalent.
• Custom terms: Often tailored to gaming, metaverse, or merch rights.

6) Buyer Due Diligence Checklist

• Read the project’s license or T&Cs before buying.
• Check if the asset is on-chain, IPFS, or centralized.
• Verify royalty terms and whether the target marketplace enforces them.
• Confirm creator wallet history and project roadmap.

Further resources

• NFT License  templates for creators.
• IPFS Docs  how to store NFT metadata permanently.
• Creative Commons  license types and implications.
• Mirror.xyz  decentralized publishing for creators.