NFT’s & The Art World: Using Tech To Sell Digital Art

With the recent explosion of NFT’s taking place, the crypto art boom is in full effect. It’s a monumental time, yet many people still don’t really know what NFT’s are. We decided to break things down and share some insight into this historical moment we’re witnessing — the merging of art with blockchain technology. First off, NFT is an acronym that stands for Non-Fungible Token — a unit of data securely stored on a digital ledger, called a blockchain, which certifies a digital asset to be unique and therefore not interchangeable. The goal of blockchain is to allow digital information to be recorded and distributed, but not edited. What does this all mean to artists and the art world? Everything.

Many artists are seeing the benefits of selling their art in this way. Where previously artists have struggled to generate a true income from their practice, they can now manage ownership of their content and transactions, with all sales going directly to them. Creators are also not limited to a specific geographical region or area, they can sell their work anywhere and get access to a global market without having to worry about shipping costs or insurance. It is the creator that is able to decide the scarcity of their asset, and they may even decide to create completely different and unique works or many, many replicas.

NFT’s can be used to represent photos, videos, audio, and other types of digital files. Non-fungible means that it’s unique and can’t be replaced with something else, which is great for artists, as it establishes inherent value right out of the gate. For instance, bitcoin is fungible, which means that if you trade one bitcoin for another, you’ll have exactly the same thing. But a one-of-a-kind token, however, is non-fungible, which means that if you trade it, you will have something wholly different. Also NFT’s offer a feature that pay a percentage every time the NFT is sold or changes hands, making sure that the value grows if an artist becomes popular, and his or her work is worth more over time.

When digital artist Mike Winkelmann, aka Beeple, put an NFT digital artwork up for auction in March 2021, he instantly became famous when it sold at Christie’s for $69 million, making him “among the top three most valuable living artists,” said the auction house. His work that sold, Everydays: The First 5000 Days, is a digital collage with rows of thumbnail images inspired by sci-fi culture, and represents 5,000 days of Winkelmann’s relentless practice in the computer arts. However, Beeple’s work had previously made headlines when Miami-based art collector Pablo Rodriguez-Fraile resold a 10-second video clip of Beeple’s on the secondary market through Nifty Gateway for $6.6 million in February 2021, which he had purchased for $66,666.66 in October 2020. Anyone can view the video online, Crossroad, but only one person can access and has proof of the original file, the owner. The price it commanded, Rodriguez-Fraile said, “Serves as a signal to the outside world that people are very, very serious about this, and it can be very valuable.”

But for Rodriguez-Fraile, it wasn’t so much an investment in Winkelmann’s art as it was an investment in NFT’s. For the purposes of art collecting, nothing changes for the buyer, the art simply comes as a digital file and not in a traditional, physical form such as a painting to hang on a wall. Rodriguez-Fraile and others with virtual galleries, coach artists and sell their work. Check out Rodriguez-Fraile’s Lot 55 Collection, which features “a collection of everything art”. The Miami-based mathematician received his MBA from Columbia University, and up until recently he was working a traditional investment job. But he was interested in cryptocurrencies and started trading non-fungible tokens. “We got close to the creators, to the artists, with development of their careers,” Rodriguez-Fraile said. One day, the Instagram artist known as Beeple, 39, based in Charleston, South Carolina, reached out to Rodriguez-Fraile for advice on how to sell his digital works in the crypto-world. “I realized this person was a superstar and was going to get very far,” said Rodriguez-Fraile, 32, of the digital artist Beeple.

NFT’s can basically be anything, from a gif to a digital painting, to even a ‘signed’ tweet, which was the case for Jack Dorsey, the co-founder and CEO of Twitter, who attempted to sell his first ever tweet and its highest offer stood at $2.5 million on March 6th. NFT’s are being seen by many as the way digital art will be acquired and traded going forward. For collectors who believe that’s true, the escalating prices are nothing compared to what NFT’s will be worth down the road, when the rest of the world has caught onto their value.

The crypto art boom exploded during the pandemic when the world was on lockdown, glued to their computers and using all things digital to function and communicate. “Perhaps partially due [to] turbulent global events, interest and investment in virtual economies and digital assets has boomed, more than ever seen before,” write the authors of the NFT 2020 report, produced in partnership with BNP Paribas financial group. “Within the Non-Fungible Token ecosystem, individual sectors have seen success. Art, Gaming and Digital Assets have all gained remarkable traction during 2020 with this once niche and experimental industry maturing into a force to be reckoned with.”

The Warhol Foundation announced recently that they will be auctioning off the late artist’s computer-based works as NFT’s. “As the great visionary of the 20th century who predicted so many universal truths about art, fame, commerce, and technology, Warhol is the ideal artist, and NFT’s are the ideal medium to re-introduce his pioneering digital artworks,” Noah Davis, a Christie’s specialist in postwar and contemporary art, said in a statement.

Meme creator Chris Torres says that crypto art provides a way to directly profit off of work that has otherwise freely made its way across the internet. “It gives power to the creator,” Torres said. “The creator originally owns it, and then they can sell it and directly monetize and have recognition for their work.” He just sold his remastered piece of the original Nyan Cat animation through the crypto art platform Foundation in February, and he will not be offering another original image, which means only one buyer can make a claim to Nyan Cat. “I think it’s cool knowing you own the only piece in existence,” Torres said. “And I feel like Nyan Cat will be a really special one to own.” Torres also recently put together a licensing business around Nyan Cat so his beloved character can pop up in games or be made into toys.

On Niftygateway, the buyer can decide whether to pay in the cryptocurrency Ethereum or in standard currency like U.S. dollars. And unlike traditional resales in the conventional secondary art marketplace, the artist by contract receives 10% of any resale of a work. Whereas in conventional resales, an artist does not receive earnings beyond the original price even if the work has since significantly appreciated in value. NFT’s can be sold on any of various online marketplaces, where users can “mint”, or create, one for anything digital.

Many South Florida artists are quickly incorporating NFT’s into their repertoire such as well known Miami street artist David Anasagasti, aka, Ahol Sniffs Glue. Anasagasti has been creating moving digital images on his cellphone and posting them on social media for years. His posts are very popular, but he wasn’t able to figure out a way of selling or monetizing on his digital works until recently when a friend of his, Tik Tok & YouTube star Sam Pepper, helped him develop a platform to sell the artworks on Superrare, another commercial crypto-art site. Check out https://superrare.co/aholsniffsglue. “Dude, it’s crazy. I’m really enjoying it,” Anasagasti said. “I’ve always seen a necessity to stay busy. I was making those things on a cellphone and it was from the heart. But to be able to monetize on that is great.”