*Professor Festinger, please accept this as my paper to go towards 20% of my final grade.
Blockchain: The New-Age Copyright Registrar?
I. Copyright in the Digital Environment
It is estimated that, in 2020, 64.2 zettabytes of data created, captured, copied and consumed on the internet.[1] In today’s Web 2.0, creative works are created, distributed, and consumed at a rate and scale that are unprecedented. This type of digital environment was likely inconceivable when the Berne Convention was adopted in 1886. According to a 2018 paper by Alexander Savelyev, copyright law has become outdated as a result.[2] Despite a major amendment in the form of the Copyright Modernization Act[3] in 2012, some provisions of which were cited in the Hansard as being the “most restrictive in the world,”[4] Canadian copyright law remains inherently ineffective online. The web is a largely decentralized and unregulated environment: An endless amount of copyrighted content is uploaded online everyday, but there is no central database that contains information about copyright ownership.[5] This means that finding the owner of such material to arrange authorized use is both time-consuming and costly, leading to both unauthorized use and fear of infringement that inhibits secondary use altogether.[6]
This prevalence of orphan works online is exacerbated by the relatively low threshold for copyright protection—the exercise skill and judgment that is merely not “so trivial that it could be characterized as a purely mechanical exercise”[7]—which is met by most works online. It also directly runs counter to the contemporary goal of copyright stated by Binnie J in Théberge v. Galerie d’Art du Petit Champlain inc: “[A] balance between promoting the public interest in the encouragement and dissemination of works of the arts and intellect and obtaining a just reward for the creator.”[8] As explained above, the lack of information about copyright ownership online impedes both the dissemination of works by secondary disseminators and just remuneration to the creator.
II. Blockchain as a Modern Solution
A novel solution to this issue is offered by blockchain—a decentralized, publicly distributed ledger that stores a secure and immutable record of transactions.[9] By registering, or “hashing,” a work into the blockchain, the original data of the work is encrypted into a unique digital fingerprint, or “hash.”[10] Any subsequent transaction on the blockchain involving the work includes the hash of the work and is timestamped.[11] Blockchain automatically records and stores information about the creation of the works and all subsequent uses thereof, as well as any transfer, assignment, or licensing of the copyright. As a result, blockchain simultaneously enables the owner of the work to track secondary uses to ensure that they receive just reward, and the user of the work to identify the owner and avoid infringing use. This automated process of de facto registration is far more timely and cost-efficient than the analog process of registering with the Canadian Intellectual Property Office [CIPO] through the e-filing application.[12] It would also completely eliminate the need for users of works to search for information regarding ownership because, on blockchain, it would be directly encoded onto the work itself.
Notably, blockchain records are not legally binding the way an official certification of registration issued by the CIPO is. However, unlike with trademarks and patents, one is entitled to copyright protection immediately and automatically upon creation of the work. This means that registration is not required—only proof of creation and infringement. Blockchain provides an immutable and timestamped proof of both, theoretically acting as conclusive and determinative evidence of copyright and infringement thereof.
Notwithstanding its promise, a blockchain registrar would have some major challenges and deficiencies to overcome. First, the person indicated as the owner on the blockchain may not necessarily be the owner of the work in real life, but rather just the first person who hashed the work.[13] Second, a blockchain system is dependent on the network effect, meaning that its effectiveness is a function of the number of people who use it.[14] Currently, there exist multiple blockchains platforms, which are not interoperable,[15] and “blockchain-ready right owners remain a small minority.”[16] The threshold for the number of users required to scale a registration system of this kind is unknown and will presumably take a significant amount of time to reach. Finally, the legal status of cryptocurrencies is still up in the air in Canada and elsewhere, with some countries banning it outright.[17] As cryptocurrencies are “an essential part of blockchain ecosystem,”[18] its outlawing would likely spell doom for the idea of a scalable blockchain registrar system.
III. Conclusion
Blockchain is widely regarded as the foundation for Web 3.0, the next generation of the web,[19] and it may thus become the standard protocol of tomorrow’s digital environment. As discussed, blockchain presents some intriguing potential as a solution to reconcile the digital environment with the contemporary goal of copyright. However, the realization of such potential will require the overcoming of many fundamental challenges. As we in fact transition into Web 3.0 in the coming years, it will certainly be interesting to see what kind of role blockchain ends up playing in our copyright law.
[1] “What does digital technology mean for data dissemination in Ghana?” (14 January 2022), online: Paris 21 <https://paris21.org/news-center/news/what-does-digital-technology-mean-data-dissemination-ghana>.
[2] See Alexander Savelyev, “Copyright in the blockchain era: Promises and challenge” (2018) 34 Computer L & Security Rev 550 at 552.
[3] Copyright Modernization Act, SC 2012, c 20.
[4] “Bill C-11 (Historical)” (September 2013), online: Open Parliament <https://openparliament.ca/bills/41-1/C-11/?page=47>.
[5] See Supra note 2.
[6] See ibid.
[7] CCH Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 13 at para 25.
[8] Théberge v Galerie d’Art du Petit Champlain inc, [2002] 2 SCR 336, 2002 SCC 34 at para 30.
[9] “What is Blockchain Technology?” (2021) online: IBM <https://www.ibm.com/ca-fr/topics/what-is-blockchain>.
[10] Supra note 2 at 554.
[11] See Ibid.
[12] “Registration of copyright—filing online”, online: Government of Canada <https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr03915.html>.
[13] See supra note 2 at 557.
[14] See supra note 2 at 558.
[15] See “Cross-Chain Interoperability: What it Means for Blockchain” (21 December 2021), online: Cryptopedia <https://www.gemini.com/cryptopedia/why-is-interoperability-important-for-blockchain#section-benefits-of-blockchain-interoperability>
[16] Supra note 2 at 558.
[17] See supra note 2 at 559.
[18] Ibid.
[19] Diego Geroni, “The Role Of Blockchain In Web 3.0” (19 November 2021), online: 101 Blockchains <https://101blockchains.com/blockchain-in-web-3-0/>.
Communications Law