How Can Companies Correctly Trademark NFTs And Web Products Under Updated TMEP Rules?

The USPTO imposes exacting identification requirements for Web3, gaming, and virtual media trademarks. Under TMEP § 1401.15(b), applicants cannot identify goods or services simply as "NFTs" or "virtual goods" because those terms do not describe recognizable items in commerce under the Trademark Act. To obtain trademark protection, applicants must clearly describe the asset underlying the digital representation, how it will be delivered, and how it is intended to be used. Downloadable virtual assets are generally classified as goods in International Class 9, even when they exist solely within a virtual environment. By contrast, non-downloadable virtual items available through a platform are typically classified as entertainment services in International Class 41. Because technical design choices, particularly whether digital assets can be downloaded or transferred, can determine trademark classification, companies should coordinate product design, marketing terminology, and intellectual property strategy early in development. Doing so helps ensure accurate filings and more consistent trademark protection across jurisdictions.The practical implication is not that every AI input must be licensed or that every deployment requires a universal “data bill of materials.” Rather, companies should embed rights analysis, documentation, contractual controls, provenance practices, and output safeguards into the design and governance of their AI systems — while accounting for the disclosure obligations that some jurisdictions, notably California and the European Union, have now enacted.

The US Patent and Trademark Office’s (USPTO) latest update — the May 2025 revision — to its Trademark Manual of Examining Procedure (TMEP) added new TMEP 1401.15(d) on virtual goods and revised TMEP 1402.11(a)(vi) on retail services, with material consequences for intellectual property (IP) strategy for companies operating in Web3, gaming, digital media, and emerging virtual environments. The key distinction for businesses operating in the virtual goods, media, and video game space is that NFTs are merely certificates attached to products; they are not the products.

The USPTO does not accept “NFT” or “non-fungible token” as an identification because that wording does not clearly indicate goods in trade or services under the Trademark Act. An NFT is a blockchain-recorded identifier that authenticates a separate digital or physical asset. The NFT is not the commodity, and owning the token does not necessarily transfer ownership of, or any intellectual property rights in, the underlying asset. Companies filing trademarks for NFT-based products should identify the underlying goods or services, rather than the token used to authenticate them. The USPTO’s demand for basic specificity also creates a practical problem for companies that built their products, marketing, and IP portfolios around the language of “NFTs,” “digital collectibles,” or “virtual goods.” Those labels may describe a business model, but they do not necessarily describe a trademarkable good.

The consequences extend beyond the trademark application to touch on product architecture, user access, distribution methods, and marketing terminology, which can now affect how a company describes and protects its offering.

Tokens Cannot Be Trademarked

The USPTO will not accept “NFTs” as the identified goods or services in a trademark application. Under TMEP 1402.02, an application under Section 1 or Section 44 whose identification consists only of such wording is not entitled to a filing date at all, because that wording gives third parties no notice of the nature of the goods or services. If the insufficient wording appears alongside definite wording, the application does receive a filing date, but the NFT wording is disregarded and cannot be used to broaden any later amendment (37 C.F.R. 2.71(a); TMEP 1402.06, 1402.07). Applications filed under Section 66(a) of the Madrid Protocol are an exception; they take the date of the international registration. To be successful, the applicant must describe is documented by the NFT or what service the business actually provides. That might be a downloadable image, a music file, a handbag, or an online marketplace.

Consider a company selling NFT-backed digital artwork. “NFT collectibles” tells the trademark examiner very little. “Downloadable image files containing trading cards authenticated by non-fungible tokens (NFTs)” identifies the underlying product, its subject matter, and the token’s role in International Class 9. This gives the USPTO something concrete to classify and search, and gives third parties notice of the scope of the claimed rights when they clear their own marks.

The same principle applies to physical products. “Jewelry authenticated by non-fungible tokens (NFTs)” identifies the goods in International Class 14. The NFT is the authentication mechanism. That places a burden on product and legal teams to unify their taxonomies and vocabularies. If the website calls something an “NFT collectible,” the product documentation calls it a “digital asset,” and the trademark application calls it a “downloadable image file,” the company has created unnecessary ambiguity. Trademark filings don’t need to reproduce marketing language, but they should accurately describe the actual offering.

Describe the Thing, Not the Medium

The updated guidance reflects a broader rule: Trademark classification follows the function or purpose of the good and the nature of the activity that makes up the service, not the technology used to deliver it, a principle drawn from the General Remarks to the Nice Classification and reflected in TMEP 1401.02(a) and 1401.15(c).

That matters particularly for goods used strictly in cyberspace. Terms such as “virtual goods,” “virtual accessories,” and “digital collectibles” are too broad on their own. Applicants need to supplement these descriptions to identify the type of digital item on offer. A virtual fashion company might identify “downloadable virtual clothing.” Another business might offer “image files of handbags for use in online virtual environments.” The relevant question is not whether the item exists on a blockchain, but rather what the consumer receives.

Another important distinction is whether a virtual item is downloadable or remains entirely within a platform. The distinction is settled, and it turns on downloadability rather than where the item is used. A downloadable virtual item is a good in International Class 9 —for example, “Downloadable virtual goods in the nature of image files of sunglasses for use in online virtual worlds” — even though it is used only inside a virtual world. An item that is not downloadable and is merely made available for use within a platform is a service in International Class 41: “Entertainment services, namely, providing online, non-downloadable virtual furniture for use in virtual environments.” That matters because the trademark class determines the scope of protection the company can obtain.

Downloadable Goods vs. Platform-Based Services

Under TMEP 1401.15(c), a service does not become a different service simply because users partake of it online.

Online banking conducted through a virtual world is still banking if users perform financial transactions and manage their accounts. The virtual environment is merely the delivery channel.

The analysis changes when the virtual experience changes the offering’s purpose. A simulated restaurant where users interact with virtual food does not provide sustenance or hospitality. It provides an entertainment experience. Calling it a virtual restaurant doesn’t cure users’ hunger and doesn’t qualify it as a restaurant for trademark classification purposes.

The same logic applies to virtual showrooms and training environments. A showroom that leads users to purchase real-world products is a retail service in International Class 35. A training simulation that teaches actual skills likely qualifies as an educational service; a game built around simulated training may not. Companies whose products combine commerce, entertainment, and social interaction will find the distinction particularly important. A single branded virtual environment may contain several different goods and services, each requiring its own analysis.

Functionality Determines Service Class

Companies operating in gaming, fashion, entertainment, and immersive platforms have become accustomed to broad category labels. Trademark law has always required the applicant to give enough information for the USPTO and the public to understand what the mark covers — see 15 U.S.C. 1051(a)(2), 37 C.F.R. 2.32(a)(6), and TMEP 1402.01. What is new is not the requirement but its application to a new category of subject matter. That means identifying the nature and subject matter of digital files. It means distinguishing downloadable products from items that remain confined to a platform. It means identifying whether a virtual experience provides a functional service or merely entertainment.

This is also where product design and IP strategy start to converge.

Suppose a game studio initially intends to sell a virtual item that players can download and use across platforms. It later decides to keep the item exclusively within its own game. That technical decision can affect the trademark analysis. So can a decision to turn a virtual showroom into a direct retail channel or to add educational functionality to an otherwise entertainment-focused simulation.

Functionality Determines Service Class

Smart product and marketing teams will bring trademark analysis into product decisions early enough to matter. Companies should be prepared to describe what the consumer will receive, whether the item can be downloaded or exported, what role an NFT plays, and what users can do inside the virtual environment. Those facts determine how the offering should be described and classified.

Those decisions affect advertising claims, consumer disclosures, platform rules, licensing arrangements, and expansion into other jurisdictions. A company that describes its product inconsistently across its trademark filings, website, user interface, and commercial agreements creates an avoidable problem that it will eventually have to reconcile.

USPTO Classification Rules