How much value would you assign to a piece of digital art or a meme? $100 or $500? Sounds too steep? What if we told you that these artistic creations – known as crypto art – are now selling for millions of dollars.
Just like every other aspect of life, the art world too has been hit by pandemic. With galleries, art fairs, and in-person auctions all closed during COVID-induced lockdowns, the ways of selling and owning art have undergone a digital-powered transformation. Cryptocurrencies and the blockchain ledgers supporting it have served as the bedrock of this paradigm shift, facilitating a seal of authenticity on these creations and lending them an edge of exclusivity.
The Up-and-Coming World of Crypto Art
The sale of antiques and art around the world shrunk by 22 percent in the year 2020, according to an Art Market report. While traditional buyers had fewer opportunities to spruce up their living spaces, millennials with the means found the perfect alternative in virtual works.
The fact that the pandemic exponentially increased screen time served as an added encouragement to invest in the nascent medium of crypto art. So, millennials riding the high of crypto investment gains began investing in pieces of art that come attached with a non-fungible token (NFT) – a certificate of authenticity created using blockchain technology.
The result? Artistic creations in the digital format selling for millions of dollars. A digital compilation of images created by an artist named Beeple fetched USD 69.3 million. Likewise, artist Chris Torres recreated the original Nyan Cat animation to mark the 10 years of the popular GIF, which sold for USD 600,000 on the crypto art platform, Foundation.
What makes crypto art viable is that the pieces come attached with a non-fungible token (NFT) – a certificate of authenticity created using blockchain technology.
Not just in art, NFT is making inroads in other creative fields as well. The band Kings of Leon became the first ever to release their new album, When You See Yourself, with an NFT stamp.
While these sales made headlines for the jaw-dropping money involved, these are not isolated incidents of sale of NFT-backed digital art. Artists across the world are leveraging this new medium that allows art to be sold as a product and not a service, making their creations more financially viable. Indian artist Amrit Pal Singh, for instance, recently sold two pieces – toy face renditions of Daft Punk – on Foundation for nearly INR 18 lakh.
NFT allows art to be sold as a product and not a service, making their creations more financially viable.
Watch: What are NFTs and how are they boosting Digital Art?
NFT and Its Role in Appreciation Value of Digital Art
Owing to the very nature of the digital world, digital art has been extremely easy to replicate so far. However, crypto art changed that by making each piece linked to an NFT one-of-a-kind. The NFT is something akin to a unique ID assigned to a particular piece of art. The number is generated, stored, shared, and updated across a distributed ledger or network of computers known as blockchain.
Whenever an NFT transaction takes place – be it buying, selling, gifting, or whatever else – the details are time-stamped and required to be validated across the blockchain that contains information regarding every detail linked to that particular NFT. Since, the blockchain is a distributed ledger – which means the data is not stored centrally but on every system/computer in that chain – the details of transactions cannot be meddled with or forged.
This implies that while copies of a digital art can still be created, these cannot be passed off as the original. This is because the NFT indicates which copy is unique and who owns it. To put it in perspective, thousands of copies of the Mona Lisa have been printed and circulated over the years. But everyone knows that the original belongs to a particular institution. That is one of the reasons that makes it invaluable.
With NFT, the same principle can be applied to digital art, or crypto art to be precise. An influx of a younger generation of buyers with markedly different tastes, the growing likelihood that more and more of us are going to consume and appreciate art on a screen, and the hand of the art world being forced by a pandemic have brought on a much-delayed transition to online sales. As things stand today, this change will stick.