Introduction To Web3 Domains
This article introduces the concept of Web3 Domains, analyses the hype surrounding them and break...
We have received countless enquiries about Web3 Domains, Crypto Domains and Metaverse Domains. However, all these terms reference the same technology yet there seems to be no consensus on how to refer to them and a severe lack of understanding as to how these work.
Our article series will introduce the concept of Web3 Domains (as we prefer to call them), break down the confusing terminology, practically demonstrates how the services operate and review their impact on Intellectual Property Rights.
Blockchain, Crypto, Metaverse, Web3 and NFTs are terms thrown around by cryptocurrency enthusiasts and technologists who have a vested interest in these “new” services, however, these technologies are currently only utilised by a niche market and have very limited applications. It is all very reminiscent of the 90s when the terms Email, Internet, WWW, Hyperlink and Browser hit our ears. Over time we began to understand the terms and the technology, with the evolution of understanding leading to regulation addressing legal, safety and security concerns.
During that period the Intellectual Property community identified potential risks and set out to protect their interests, which lead to legislation such as the Digital Millennium Copyright Act (DMCA), Anti-cybersquatting Consumer Protection Act (ACPA) and the Electronic Commerce Directive 2000 and administrative processes such as the Uniform Domain Name Dispute Resolution Policy (UDRP).
The Intellectual Property community is now “threatened” by technology that may be difficult to govern due to its decentralised structure. This has led to panic fuelled by mainstream and social media picking up on potential risks, which have been amplified by the lack of understanding of the technology and its application.
The first step to address the hype is to breakdown the terminology, digest its meaning and understand its practical application.
Researching newly coined terms and technology can be overwhelming, so we have identified the key terms that require an explanation as they are a significant part of the Web3 Domain environment.
|Cryptocurrency||A digital currency in which transactions are verified and records maintained by a decentralized system.|
|NFTs||Assets on a blockchain with unique identification codes that distinguish them from each other. Each NFT is represented by its own value, like art while fungible tokens (cryptocurrencies) have an equal value and can therefore serve as a form of currency.|
|Web3 Domains||Web3 domains may be used as an address for websites that reside on a decentralized internet or used as a wallet address. These domains are outside of the control of any central entity, such as ICANN|
Web3 domains are a popular topic right now that is creating panic within the IP community, yet whilst these domains pose a significant threat to brand owners, their risks have been amplified by a lack of understanding relating to the terminology and technological applications. Within our upcoming articles we will discuss the governance that exists within the Web3 domain space and how mainstream these domains have become. Additionally, we will look at how brands can tackle the issue with a strategic and measured approach, so be sure to keep an eye out for our next article.
To better understand the impact of Web3 domains and to begin developing your defensive strategy in this space, reach out to our brand protection team:
Impersonation on the internet is not a new issue and the issue of imposer social media accounts is on the increase as these accounts can be set up in minutes.
Impersonation on social media takes various forms but broadly refers to profiles or accounts that feature the name or image of an individual or organisation which is most likely used for fraudulent purposes.
Typically, the perpetrators use the same photos, names, descriptions or hashtags as the official accounts. In an attempt to add legitimacy to the bogus accounts, the perpetrators may create other seemingly innocuous accounts in the name of random individuals with no connection to the brand and use them to “like” or post comments to the main imposter account.
The fact that a given imposter account may have enough likes or comments may be enough to convince users seeking the brand owner that the imposter account is in fact the genuine one.
On social media platforms such as LinkedIn, impersonation of employees and directors are frequently encountered, but increasingly impostor accounts can be found on Facebook and Instagram as specific pages, profiles or groups.
Once these bogus accounts are created the perpetrators may start sending private messages directly to victims or redirect them to external websites. They may also even encourage victims to contact them via WhatsApp. WhatsApp and other messaging services such as Telegram, have the obvious advantage in that its communications are almost impossible to monitor and the perpetrators can groom their victims, safe in the knowledge that the targeted brand owner may not be aware and therefore unable to intervene.
Bogus social media accounts are frequently used to perpetrate multiple online scams at the same time. For example, Business Email Compromise scams (“BEC” scams) are not new but are a form of phishing where criminals attempt to dupe brand owner executives or employees into revealing sensitive information or even transferring funds. These emails are harder to detect as they are tailored to specific individuals. Increasingly, criminals are using copycat social media profiles (on Linkedin and Facebook in particular) with the aim of convincing the recipients of emails, that they are in fact genuine. These scams affect brand owners both large and small, from multinational companies to start-ups.
On the one hand, smaller sized brand owners may not have official social media accounts for either the company itself or their executives, so they are often easy prey for online criminals who will try to take advantage of the gap and attempt to dupe the brand’s customers and potential customers. At the other end of the scale, brand owners with a more established social media presence are also attractive to criminals as they know the brand already has a significant number of followers and potential customers to target.
From an enforcement perspective, Lexsynergy still recommends that brand owners ensure that they have a social media presence for their company and for key executives which are then ratified or authenticated as official accounts. It is far easier to report a case of impersonation if the brand owner concerned can point to their official social media accounts being cloned or mimicked.
Secondly, whilst automated searches on social media platforms for the brand name and the names of key executives can help to alert the brand owner to suspicious accounts at an early stage, there is considerable value to be had by periodically conducting manual searches for those keywords.
Finally, as a general principle prevention is always better than cure, Lexsynergy recommends brand owners have visible scam warnings on their official websites and social media accounts which are regularly updated to take into account how the perpetrators adjust their tactics to perpetrate their scams.
Account security is also important. If brand owners operate social media groups, they should ensure that several employees have “admin” rights in the event that one of their administrative user accounts is compromised, the other users with admin rights would be in a position to mitigate the damage caused.
If your brand is having issues with social media fraud, be sure to reach out to our brand protection team who will be able to provide specialist support to combat these issues:
Russia effectively legalised patent theft last week, declaring that the unauthorized use of patents belonging to businesses affiliated with the UK, US, EU, Australia, Ukraine and 17 other “unfriendly nations” will not lead to the affected businesses being compensated.
In addition to this decree, officials in Russia have also hinted to the possibility of removing restrictions on trade marks, according to their state media, leaving large multi-national brands with no legal recourse should copycat businesses utilize the brand as their own.
Opportunists in Russia have already looked to capitalise on this situation, with trade mark applications being filed for businesses that strike a significant resemblance to marks belonging to Ikea, Instagram, McDonald's, and Starbucks. Despite the substantial resemblance these marks have to huge multi-national brands, there is very little these companies can currently do to protect their brands, as the Russian courts will be stacked against them and its unlikely that they will be able to find local counsel due to safety concerns.
This leaves officials of companies operating in Russia in a very difficult scenario, where on one hand, they can protect corporate assets by continuing to operate in Russia (although this likely comes with significant moral and political backlash for the business); or they can halt operations and run the risk of their brand being infringed or diluted, as seen with the Peppa Pig trade mark ruling.
Last week, a Russian court ruled that the Peppa Pig character’s trade marks could be used by Russian businesses without punishment, after Entertainment One - who own the rights to the children's series - had taken legal action against a Russian man who had drawn his own versions of Peppa Pig. When providing the ruling the judge cited the "unfriendly actions of the United States of America and affiliated foreign countries", illustrating how brands from these countries have no immediate recourse to protect against their stolen IP.
In the past, there may have been other avenues available to resolve such cases, and in theory, the World Trade Organization could settle any IP disputes between the U.S. and Russia under the Agreement on Trade-Related Aspects of Intellectual Property Rights. However, even though both countries have signed onto the treaty, this route is unlikely to prove effective due to the suspension of diplomatic relations, with the US already stating that “the normal rules for our international commercial interaction are over.”
So what does this mean for domains?
There are a number of Russian domain extensions that may see a rise is squatting and other forms on unlawful use considering the Russian Governments approach to IP enforcement. The domain extentions .рус, .moscow and .москва (Cyrillic for Moscow) fall within the UDRP, however .ru, com.ru, .su (Soviet Union – believe it or not!) and .рф (.RU in Cyrillic) are subject to local Russian laws.
At the best of times, local Russian domain disputes can take time and substantial amounts of money to resolve.
If you are able to keep your Russian domains, do so. Do not let them expire! If you are able to secure additional domains to reduce your exposure, register those key domains. Our suggestion is subject to the sanctions applicable in various countries so make sure that the appropriate due diligence is conducted.