Abstract
Virtual property warrants legal protection because it holds economic and sentimental value. Non-fungible tokens are virtual assets that are not legally defined as virtual property in South Africa; therefore, owners of NFTs can have their rights unlawfully violated. There is need for specific legislation in South Africa that provides legal certainty for the unique challenges posed by virtual property. This study examines the legal protection of virtual property rights in South Africa with a focus on the classification of NFTs. It explores how the characteristics of virtual property inform the judiciary when presiding over disputes concerning the limitation of virtual property rights. This study’s discussion, on the classification of NFTs as virtual property is crucial to understand how owners/users of virtual assets can protect their property rights. This is achieved by defining the five indicia of virtual property within the characteristics of NFTs. Thereafter, justifying traditional property rights application to virtual property. This permits for an assessment of the legal standards of virtual property protection in South Africa, with a focus on the constitutional protection of NFTs through discussing a case scenario. The case scenario will be applied to case law such as the Herman Bester NO and Others v Mirror Trading International and various legislative framework. Such as the Financial Intelligence Centre Act 38 of 2001 (FICA); Financial Advisory and Intermediary Services Act 37 of 2002 (FAIS); the Protection of personal information Act 4 of 2013 (POPIA); Electronic Communications and Transactions Act 25 of 2002 (ECTA); Consumer Protection Act 68 of 2008 (CPA); Trademarks Act 194 of 1993 and the Cybercrimes Act 19 of 2020. This study seeks an international and foreign law perspective from the directives of the constitutional property clauses of the European Union and Germany. The discussions made in this study underscore the need for a South African legislative clarity to address the evolving landscape of property that ensures adequate protection for individuals engaging with virtual properties such as NFTs.