Unofficial Magic: The Gathering NFT project interrupted as WotC summon lawyers

Magic: The Gathering publisher Wizards of the Coast has dropped the cease-and-desist hammer on an NFT project called mtgDAO, which is seeking to create its own parallel MtG format using NFTs based on real-world Magic cards. Wizards of the Coast, naturally, says the project is a clear violation of its copyrights and trademarks, and also suggests that it might have an NFT-based Magic project of its own in the works.

The intent of the mtgDAO project is broken down in confusing detail in its white paper, which says that Magic: The Gathering is "a great game that invites you to invest in its economy," but claims that many players are reluctant to investment in cards because "the value of a card could change at any time."

"The reality is that individual cards are unpredictable investments at best, and many lose value," the paper says.

The solution to the problem of unpredictability is—that's right—NFTs, the notoriously shaky, sketchy, vulnerable-to-criminality digital "asset" that nobody really understands. The goal isn't to make an unlicensed Magic: The Gathering game, though, but rather to create a new format using NFTs that will only be playable if the owner can prove ownership of the corresponding "real" card, either physical or in Magic: The Gathering Online or Arena. And that's the dodge: MtgDAO isn't printing cards or making an unlicensed videogame, but "adding an additional layer of scarcity in order to be able to play Wizard's cards in a new format."

From the white paper:

Players will need the actual card in order to legally play the game, whether that be a paper card, a card on Arena, or a card on MTGO. The NFTs aren’t meant to establish ownership of the card, it will only be used to allow that card to be played in the mtgDAO format. We are not building gaming software or printing copies of official cards. Games will still be played using Arena, MTGO, or tabletop with real cards. NFTs can be thought of as tickets to enter tournaments or a way to represent temporary ownership in a cube draft, not as ownership of the copyrighted card.

One thing I find baffling in all of this is what the first page of the white paper complains about the Magic meta and the high expense of maintaining a competitive deck, while the rest of it explains that mtgDAO will be pretty much exactly the same thing, but with NFTs: Players willing to shovel money into the tokens will dominate, while everyone else will be left to "see how far up the ladder you can take a deck with limited funds."

Again, from the white paper:

The top of the ladder will theoretically be populated with the same deck as is winning outside of the mtgDAO format. Those cards will be popular and will require a lot MTG locked to mint them. The real fun in the format will be outside of the top 10 (or 50), where new decks are being tried by players with more limited funds.

I mean, isn't that literally Magic: The Gathering?

Regardless of the mechanics, duplication, and extreme likelihood that people putting money into this project will lose it even quicker than they expect, it doesn't seem likely that the project will succeed. In a politely worded letter, lawyers for Wizards of the Coast expressed appreciation for the group's enthusiasm for Magic: The Gathering, but also warned that unlicensed use of Magic assets "would be unlawful."

"You appear to be operating under the mistaken assumption that the project would be legal because you would allow the reproduction of Magic cards in the form of NFTs only by a player who had purchased a physical card, a card on Arena, or a card on MTGO," the letter states. "This is not correct. It is the exclusive right of the copyright owner to reproduce the copyrighted work, such as a Magic card, in any format."

The letter then goes on to state that Wizards of the Coast "is currently evaluating its future plans regarding NFTs and the Magic: The Gathering cards." A decision on that front currently hasn't been made, but "use of NFTs in connection with Wizards' intellectual property is therefore strictly prohibited."

After sharing the email, mtgDAO posted a lengthy Twitter thread defending the principles of the project, which to be blunt sound to me more like a reason to stay away from it entirely. "This attitude makes the success of their own NFT project tenuous," one tweet from mtgDAO says. "There is a clear pushback from most of the gaming community against NFTs. It's no wonder gamers are wary and disgusted."

That's quite a statement from a group looking to launch a game-based NFT. But so is this: "Wizard's position seems reactionary but I don't currently know enough about copyright law to be confident about how a court would interpret this situation." For now, the creator intends to contact the lawyers, get clarification on the request, and try "to help them see something like mtgDAO, and web3 in general, as an opportunity and not a threat."

Wizards of the Coast declined to comment on the project, or on its own possible plans for Magic: The Gathering-based NFTs.