Through Art Market & You, Art From Us provides you Analysis, Opinion and Factual Reports regarding the current on-goings of the Global Art Market. In this article, we explore NFT in Art.
What is NFT?
To understand NFT, consider the following words.
“…Gold is gold everywhere, fungible and indifferent. But when a disk of gold is stamped by a coiner with certain pompous words and the picture of a King, it takes on added value — seigneurage. It has that value only in that people believe that it does — it is a shared phant’sy.”– Neal Stephenson, The Confusion
Saying something is ‘fungible’ implies that it is replaceable, or can be substituted. Thus, a non-fungible token, by definition, is a type of digital token that is not replaceable.
Wait, did I lose you at ‘digital token’?
A digital token = a unit or an item that is digital in nature.
Thus, a single NFT represents an individual digital item, such as a video, soundtrack or work of art. NFTs enable trade of these assets and act as proof of ownership in digital space. One of the key questions we would like to raise is – What are the parameters and definitions of “validity” as per “real-world” measures. And is ownership secure, stable, transferable, and most importantly recognised by existing economic, political and international bodies.
So, where do NFTs come from? To answer this, we must first look at other types of digital tokens. And understand that they are products of blockchain technology. To put it simply, non-fungible tokens solve the age-old crisis faced by digital artists. That is – how to monetise their works.
In enabling trade within virtual spaces, they create a new market for real-world artists to digitise and monetise their creations. For many, these two avenues of recognition, access, control and dissemination of artworks makes NFT’s the next best thing since Sir Tim Berners-Lee invented the World Wide Web (www) and made it available in the public domain, with an open license. Granted NFT’s are commodities as well as holders of value. However, the technology – blockchain, provides fertile ground for innovation at best and fraud at worst.
NFTs – Value or Fraud, especially in Art
When discussing NFTs in art, we must always begin with digital art. A medium that has always been seen as ‘upcoming’, ‘less than’, ‘not real art’, and hence ‘of no real value’. A crucial reason it has not been considered a popular art form is the issue of ownership. An artist may slog away for months and create the most beautiful and meaningful work on her computer. But, how does she sell it? How does she ensure her work is protected, and not replicated without consent? How does she convince a potential buyer that this is her real, authentic work? NFTs promise to resolve these issues.
Companies such as Ethereum, Opensea etc. use blockchain technology and cryptocurrency, and have been early movers and enablers of this new frontier and art. Adopting the technologies between 2008-2020, they now position themselves as NFT warriors and advocates.
What has us talking about these non-fungible tokens? It’s the alleged ‘PR stunt’ that Christie’s recently pulled off at their March 2021 auction. American digital artist Beeple (Mike Winkelmann) was the first to successfully sell an NFT of his work for $69 million at Christie’s. The work was bought by Indian-origin cryptocurrency investor Vignesh Sundaresan (or Metakovan, as he is known online), and his business partner Anand Venkateswaran (a.k.a. Twobadour). We find it worth mentioning that the two gentleman here are blockchain entrepreneurs and perhaps have a macro-plan at play here, of which 69 million is a minor move.
What that larger plan is, we cannot predict yet, but they are worth keeping an eye on. We know we are watching them closely as they attempt at breaking down old structures, and introducing new ones. Will they be successful and what reach shall they have will largely depend on three factors. The first shall be the birth or establishment of an accepted “mint”-like agency for NFT’s. The second shall be their collaboration or their denouncement of legal frameworks and policies. The third shall be the participation of industry players and stakeholders in the re-imagining of the deliverables across trade markets.
The work that has stirred this debate and conversation is titled “Everydays – The First 5000 Days”. It is part of Beeple’s ongoing 14-year-long project where he creates a new work of digital art every day. It is said that the buyers of the work will receive a digital file that could either be displayed on any kind of digital screen, or then perhaps projected on to any surface. Our question to you is, are you ready to collect and trade in this new NFT space.
In light of this landmark sale, we cannot help but wonder, is NFT’s heralding a new era for art or just the latest trend ?
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