Digital art and NFT: How digital watermark can solve the trust issue.

According to the CEO of OpenSea, 80% of NFTs are made up of plagiarized or fake works. This incredible figure is only made more remarkable when considering the volume of transactions at play (50,000 a day).

However, we've recently seen misuse of this feature increase exponentially.
Over 80% of the items created with this tool were plagiarized works, fake collections, and spam.

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OpenSea is the world’s largest marketplace allowing artists to sell NFTs and collectors to discover and buy exclusive artworks.

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For now, as it is still a highly speculative market, not dissimilar to gambling, buyers are willing to take their losses. But this "Russian roulette" spirit will become unacceptable as the market matures.

Whether analog or digital, the art marketplace is all about trust. Trust in the artist's reputation and trust that the art is original. If either is broken, the value of the artwork is nullified.

The problem with NFT

Since it cannot be altered, the blockchain is a perfect tool to certify and protect trust. It just has one limitation. What you can inscribe into it is very small. Thus the need for NFT.

NFTs contain all the information about an art transaction but nothing of it. Which means the actual art piece is located somewhere else. And usually not in a place of trust (IPFS) and where it can be easily replicated. And resold.

“Bored Ape” artwork creation - the latest example of how the NFT world handles copied artworks.

For example, one could purchase a Bored Ape NFT on a marketplace like OpenSea, while the same Bored Ape artwork could be sold on another marketplace. What protection and security has a buyer to certify that his version of the artwork is the original? Today, none.

Of all the NFT transactions made today, none guarantees the exclusivity of a file. And while the NFT token offers proof of ownership, it is really only about itself. This means the NFT can only guarantee the ownership of the actual token, not of the art itself.

An unbreakable bond thanks to digital watermarking

All that needs to happen is for the art to contain its certification of uniqueness and link to the NFT. Imagine if an NFT was to be sold with the art containing a unique invisible watermark secured to that NFT. If and when the watermark is read, it would link it to one unique NFT. All other NFTs and associated copies would be easily identified as fakes/copies. It would enforce authenticity, uniqueness, and scarcity. And it would eliminate copymints. No watermark, not the original creation. 

Such technology exists and could easily be deployed today. With Imatag invisible watermarking, each file can get a unique invisible watermark associated with an NFT. Each copy of that file would have its own watermark and, when read, would point back to that unique NFT. 

In a few easy steps, digital watermarking allows artists to create unique copies of images that each have their individual marking.

If someone tried to resell the art somewhere else by minting a new NFT, a simple watermark detection would prevent it. This existing solution would significantly deter and reduce NFT scams.

All sold NFT art could be centralized in a marketplace independent database for easy interrogation via an API. A quick similarity check would be made each time a new work is offered to any participating marketplace. If no image matches are found, the offer transaction can proceed. However, if a match is found, the existing watermark is read, and the related information (the original NFT) is displayed. The transaction is interrupted.

Rebuilding trust with invisible watermarking

DeviantArt offers protection technology to creators, but the best security will come from the combination of image matching tools with a digital watermark.

Deviant Art has recently announced the deployment of a similar initiative. But it, unfortunately, stops short of being truly effective. Using only plain image matching technology, it is bound to make frequent false-positive errors, creating a painful and unreliable experience for users. Only a digital watermark can return a 100% error-proof result.

The search feature can easily be extended beyond a database and run through the internet via web crawlers to increase the chances of finding a match. Historical indexes could be added to the database to help increase speed.

Because buyers are the lifeblood of any business, it is critical to achieve their trust. With a unique watermarking process in place, all participating NFT marketplaces would regain credentials of high trust, guaranteeing buyers the originality, authenticity, and uniqueness of the work offered. 

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