A pair of non-fungible token projects are experimenting with the line between plagiarism and parody. The PHAYC and Phunky Ape Yacht Club (or PAYC) collections, both of which are based on the same gimmick of selling NFTs with mirrored but otherwise identical versions of high-priced Bored Ape Yacht Club avatars, have been banned by digital marketplace OpenSea.
The competing projects are now selling their apes while avoiding bans from other marketplaces, becoming the latest example of how the NFT world deals with copied art.
Bored Ape Yacht Club (or BAYC) NFTs are among the most expensive crypto art assets, having recently surpassed CryptoPunks as the most expensive NFT avatars, with the cheapest available ape selling for $217,000. However, like other avatars, the associated ape can technically be copied or modified by anyone.
PAYC announced its launch in early December, with a vague mission statement promoting decentralization and denigrating “rich douchebags” who had (allegedly) seized control of the original ape market. It alluded to CryptoPhunks, a similar project that earlier this year flipped and resold expensive CryptoPunks images. Beginning December 28th, early arrivals could mint left-facing apes for free, while others paid a fee of.042 ETH (currently around $157).
Soon after, PHAYC debuted with a witty website that described the project as “a limited NFT collection where the token itself offers no membership and no allegiance,” an inversion of the promise made by BAYC creator Yuga Labs. According to one PHAYC community member, the project is “a satirical take on the current state of NFTs and members of the NFT community who may be taking the NFT market a little too seriously.”
PAYC and PHAYC have since fought on Twitter over who is the genuine Bored Ape Yacht Club ripoff, with PAYC’s founder referring to PHAYC as a “cash grab fraud project.” PHAYC charged people to mint its apes, and according to CoinDesk, it made around 500 ETH (or about $1.8 million) in sales. By contrast, it says PAYC earned around 60 ETH (or roughly $225,000) from its paid sales.
Both projects may be in legal jeopardy. It’s common for NFT lineups to mimic each other’s art styles or names. However, Yuga Labs owns the copyright to its ape images, and PAYC and PHAYC were kicked off OpenSea for allegedly violating its copyright infringement policies. (PAYC has also been removed from competing markets Rarible and Mintable, though PHAYC remains on Rarible.) If Yuga Labs files a formal legal complaint, PAYC and PHAYC may be able to defend their apes as transformative fair use, following in the footsteps of appropriation artist Richard Prince. However, there is very little legal precedent surrounding NFTs in general, let alone their copyright implications.
Yuga Labs did not respond immediately to a request for comment on whether it planned to file such a complaint, and PHAYC did not respond to a Twitter message about the issue. PAYC confirmed on Twitter to The Verge that it has not received any legal threats from the BAYC team.
So far, it appears that both projects are more concerned with making their apes tradeable online. NFTs are supposed to exist outside of any given platform, but markets such as OpenSea have become massive bottlenecks by simplifying the selling process. While the sites have hosted numerous NFT projects based on stolen art, they have delisted copycats such as CryptoPhunks in response to complaints from companies such as CryptoPhunks creator Larva Labs, and they have banned some individual NFTs that were stolen from their owners.