LicenseToken.sol

View the smart contract for License Tokens.

A License Token is represented as an ERC-721 NFT and contains the specific License Terms it represents. Its associated licenseTokenId is global, as there is one License Token contract.

Once License Terms are attached to an IP Asset, it becomes public so that anyone can mint a License Token for those terms. A License Token is burned when it is used to register another IP as a derivative of the original IP Asset.

A diagram showing what happens when a License Token is minted.

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Private Licenses

In order to mint a private License Token, the owner of a root IP Asset can issue License Tokens that have terms not yet attached to the IP Asset itself. It is important to also note that derivative IP Assets cannot issue private licenses because it is restricted to only issue licenses of its inherited terms.

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Transferability of the License Token

License Tokens might be transferrable or not, depending on the values of the License Terms terms they point to.

Once a non-transferable License Token is minted to a recipient, it is locked there forever.

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Registering a Derivative

You can register an IP Asset as a derivative of other IP Assets, each with their own license terms agreement. This creates a legally binding agreement between IP Assets that enforces things things like automatic payments in the 💸 Royalty Module.

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⚠️ Restrictions

There are a few restrictions on registering a derivative:

  • An IP Asset can only register as a derivative one time. If an IP Asset has multiple parents, it must register both at the same time.
  • Once an IP Asset is a derivative, it cannot link any more parents.
  • When you link an IP Asset as a derivative, it cannot have license terms attached. It will inherit its terms from its parents.
  • None of the parent IP Assets or the child IP Asset can be disputed.
  • The child IP Asset cannot have derivatives already.
  • If at least one of the license terms is commercial, then they all must be commercial (commercialUse = true)

There are two ways to register a derivative IP Asset.

An IP Asset can only register as a derivative one time. If an IP Asset has multiple parents, it must register both at the same time. Once an IP Asset is a derivative, it cannot link any more parents.

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1. Using an Existing License Token

A License Token is burned when it is used to register another IP as a derivative of the original IP Asset.

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2. Registering a Derivative Directly

You can also register a derivative directly, without the need for a License Token. Remember that if License Terms are attached to an IP Asset it is public to mint the License Token anyway, so this is simply a convenient way to go about it, thus skipping the middle step of minting a License Token.