From online games to a drawing by Banksy it was a short step. And now non-fungible tokens are revolutionizing the art market, and not only. Here is what they are, how they work and why everybody is falling for them
What about virtualizing a work of art so that its value is only linked to an immaterial dimension? Considering the recent events characterizing the art market, or better crypto art, it seems so. The new exchange token is called NFT, i.e. non-fungible token. That is to say, a “virtual currency” which, being absolutely one of a kind, is not interchangeable, unlike bitcoins and other types of tokens. The art market is one of the first in which this new resource has been used, but it is not the only one. Will NFT be the new promised land of the blockchain? (NFTs: The new promised land?)
How NFTs were born and their success story
Like bitcoins, non-fungible tokens are digital objects, registered in the Blockchain, which assign some special rights to given selected users. Usually we are talking about properties. Nevertheless, as said before, NFTs are not interchangeable since they supply unique and original data. That is why they are suitable for identifying unique and unrepeatable entities such as works of art. In other words, every token is the same as the others whereas every NFTs is different from the others.
Non-fungible tokens appeared for the first time in 2015 on Counterparty together with the game named Spell of Genesis. Ethereum followed in its wake, by launching the game entitled CryptoKitties based on a series of collectible digital kittens which become rarer and rarer every time they mate and the newborns are introduced (I token NFT, il prossimo hype della blockchain?).
NFTs and the art market
Injective Protocol, a Collective from Brooklyn involving many art and technology lovers belonging to a company operating with the Blockchain, has recently paid 96 thousand dollars for a work of art by Banksy entitled Morons (White), and has then burnt it down to ashes. The reason is not as illogical as it may seem, though complex and questionable. Before setting the art work on fire, the members of the Collective had turned it into NFTs. An extreme act aimed at opening the way to a new form of art, the so called crypto art.
A digital art expression using the current most used channel and a more accessible and democratic environment compared to the hyper selective, snobbish and elitist art market. Thanks to the exclusivity of non-fungible tokens, Bansky’s drawing has maintained its unique features. Whoever buys its digital representation ( on sale on OpenSea) will actually receive an official certificate of authenticity supplied by the artist’s agency and will therefore be entitled to keep it or resell it as if they were operating in the traditional art market. (Bruciata un’opera di Banksy da 96 mila dollari e poi digitalizzata. Ecco il mondo della crypto art e cosa sono gli NFT).
From Banksy to a tweet
The case of Banksy’s drawing is unique neither in the world of art, even though such operations are still not very common, nor elsewhere. Let’s take as an additional example another recent event concerning a fully digital financial transaction. Jack Dorsey, Twitter co-founder and CEO, has recently auctioned off its first tweet, dating back to 2006, through Valuables. And, although the message is nothing worth remembering, – “just setting up my twttr”, the highest bid ever put forward so far actually is: 2,5 million dollars. The bidder is Sina Estavi, CEO of Bridge Oracle and CryptoLand.
Dorsey, who is also a well-known philanthropist, will give the whole amount to charity. It is obvious, now, that digital objects can actually be worth huge amounts of money, like in this case, due to their uniqueness. And also non-fungible tokens have proven to be the ideal instrument for their sale. (Il primo Tweet della storia è in vendita a un prezzo folle).
At first glance, such an action like the one performed by the Injective Protocol may seem provocative. However, it is as reasonable as the values assigned to artworks sold via the traditional art channels and their floatation which has always been due to unpredictable factors. Besides, the value of artworks is not established on the basis of their material worth and turning them into digital works only contributes to their consecration and immortality, since this way they become indestructible and non-perishable. If we look at other sectors we can actually perceive NFTs extraordinary potential.
Is art dematerialization going to put its value at risk? Tweet @agostinellialdo
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