It’s been hard to miss the wide media coverage of the latest crypto trend, NFTs. After several significant sums of money have been made from selling NFTs, the world is taking notice and many are wanting to get in on the money. While NFTs aren’t a new thing, how NFTs are fueling the modern art world certainly is. Let’s explore where this came from, and where it could be headed.
What Are NFTs?
Let’s start at the beginning. NFT stands for non fungible token, which essentially means that it is a one of a kind token. Unlike Bitcoin or Ethereum, or even fiat currencies, that can be used interchangeably, NFT tokens have one specific purpose for life. These crypto coins are created on the blockchain and represent something unique, such as a painting or a house. The token represents ownership of that asset, and this data and ownership is cemented in a block on the blockchain providing evidence that will last a lifetime. Another unique characteristic of these tokens is that they can incorporate a smart contract that pays the creator a portion of money each time the asset and token are sold. Particularly attractive to the art world.
“They use cryptographically verified information to ‘lock’ and secure a particular asset, which can be bought or sold, but never replicated,” explains Ivan Soto-Wright, founder and chief executive of MoonPay.
You might have heard of CryptoKitties. The platform was created in late 2017 and was one of the first explorations of blockchain technology in the recreation and leisure realm. CryptoKitties allows users to “purchase, collect, breed and sell virtual cats” on the platform, and each cat is represented by an NFT token.
How NFTs Are Fuelling The Modern Art World
When the world was brought to a standstill during the pandemic, this had dire effects on a number of creative industries. Looking to bring income opportunities to the many people that make up this industry, a team of crypto enthused creatives, engineers, developers, designers and project managers got together to make a change. They created the platform Unique.One, a decentralized marketplace that allows artists from around the world to upload their artwork and create NFTs.
This is not the only NFT marketplace selling digital art. Also founded in 2020 is the well known marketplace, Rarible. The platform hopes to become a Decentralized Autonomous Organisation (DAO) spreading the governance rights across the platform’s artists. Rarible sells art ranging from 0.002 ETH to 365 ETH, and that’s just what’s been sold today. Then there’s Mintable, another marketplace with the same inclusive and creative interests. On Mintable sellers can create stores that sell collections of their art, both digital and physical.
They’re not just fuelling art, the business of selling NFTs stretches into the music world, the sports world, and beyond.
High Profile NFT Sales
There’s a reason why NFTs have recently catapulted into mainstream media. The rising popularity of these one of a kind tokens has seen some substantial sales made recently. Just this year alone there have been several multi million dollar NFT sales, explored below:
- Canadian musician Grimes recently sold some of her digital art, raking in $6 million.
- Twitter and Square founder, Jack Dorsey, recently sold an NFT representing ownership of his first ever Tweet. The one liner "just setting up my twttr" sold for $2.5 million.
- Electronic musician 3LAU sold NFTs representing his songs and albums which earned him a whopping $11 million in just a weekend.
- Kings of Leon also followed suit, selling NFTs linked to their upcoming album. They reportedly made $2 million and burned the unsold tokens.
- Most famously, auction house Christies recently facilitated the sale of an artist by the name of Beeple’s piece titled “Everydays: The First 5000 Days”. Every day the artist created a new digital artwork for 13 years (5,000 days) and this was a collection of them all. The piece sold for a record breaking $69.3 million (record breaking for digital art).
Are NFTs Here To Stay?
A question on everyone’s lips and certainly a good one. There has been an influx of interest, partly fuelled by the crypto mania and not wanting to miss out, and partly fuelled by people wanting to support the art world. How NFTs are fueling the modern art world is considerable, however as Robert Norton, chief executive of Verisart pointed out, buying art for the sake of tapping into a potentially lucrative token misses the point of buying art in the first place. Whether you choose to engage or sit this one out, for onboarding the more traditional cryptocurrencies there is always Oobit.