Problem Statement
The rapid growth of artificial intelligence (AI) in creative industries has opened new possibilities for digital art, but several key issues remain unsolved.
Centralization of AI Creative Tools
Current leading AI tools such as MidJourney, OpenAI’s DALL·E, and Stable Diffusion (in hosted platforms) are largely centralized and controlled by private entities.
Artists pay recurring subscription fees while having little or no ownership of the creative process.
Generated works lack on-chain provenance, making it difficult to verify originality, authorship, or the creative parameters that produced the artwork.
Incomplete Metadata Capture in NFT Marketplaces
Popular NFT platforms focus primarily on the final digital output (the image, video, or file).
Critical creative metadata such as prompt text, AI model used, training dataset references, and licensing terms are often not stored on-chain.
This creates a gap in transparency, authenticity, and long-term archival value of AI-generated art.
Unsustainable Artist Funding
While NFTs introduced royalties as a way to support creators, enforcement across marketplaces is inconsistent and often bypassed.
Artists relying on royalties face income instability, as secondary market trades may not respect the intended royalty structure.
Without a reliable funding mechanism, many creators struggle to sustain their artistic practice.
Collector Risks: IP Rights & Market Speculation
Collectors purchasing AI-generated works often face uncertainty around intellectual property rights.
Licensing terms are ambiguous: Can the art be used commercially? Is it derivative of copyrighted datasets?
Additionally, speculative pricing in NFT markets has led to inflated valuations with little connection to true creative value, leaving collectors vulnerable to financial loss.
Weak Community Governance in Creative Platforms
Most NFT and AI-art platforms are governed by small, centralized teams.
Communities have little say in how platforms evolve, how royalties are distributed, or how curation and moderation policies are enforced.
This centralization limits innovation, reduces trust, and discourages long-term community participation.
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