Blockchain-based digital collectibles in the shape of NFTs (non-fungible tokens) have changed how art is made, perceived, bought and sold. Digital marketplaces like OpenSea, Binance NFT, SuperRare and MakersPlace have made art more accessible – and helped creatives find new audiences.
The March 2021 Christie’s sale of a Beeple digital collage was a key moment regarding the stature of NFTs. ‘Everydays – The First 5000 Days’ closed at over $69m – the third highest auction price achieved by a living artist (after Jeff Koons and David Hockney). Notably, 91% of bidders were new to the auction house, having previously bought their NFTs on the aforementioned digital art marketplaces. This event was art breaking free from convention in every sense.
The sale set off a surge of interest in digital art. NFT marketplaces, collection creators and IP holders consistently continued attracting investors during 2022, with Yuga Labs – creators of the high-profile and popular Bored Ape Yacht Club collection – closing a $450m seed round of funding in March that valued the company at $4bn.
Beeple (b. 1981), EVERYDAYS: THE FIRST 5000 DAYS. Via Christie's.
Although NFTs have received criticism for their environmental impact and been dismissed by some as speculative, a September report by Nansen revealed the total market cap of NFTs had reached more than $11.3bn. The same report cited Verified Market Research predicting this figure could soar to $231bn by 2030.
However, by the middle of 2022, a crypto winter was coming in – and there was a subsequent related sharp decline in the NFT space. According to crypto websites The Block and Crypto Slam, NFT trading volumes have plunged compared to the same time last year. As recently as April, trading volumes for some individual weeks reached well above $1bn. During the first half of autumn 2022, they averaged just $35m per week.
The drop has been particularly severe in art and collectables – and yet there is cause for optimism. Crypto venture capitalist Li Jin said the crash will ultimately make the NFT market stronger and more utilitarian, with more “assets that people actually use”. Others assert the market will move from a speculation to a building period, as NFT prices retreat to a more sustainable level.
Despite these market conditions, the status of NFTs in the world of art appears to be strengthening. In October, amidst reports of lower NFT trading volumes, an NFT collection by Sir Anthony Hopkins sold out in under seven minutes – the fastest in OpenSea history. Smaller individual creators remain positive too. Speaking to Vogue, artist Shavonne Wong said the art world always “seemed closed off” and that as an artist, you had to “make the right connections” to succeed. But in the NFT space, she has the “creative freedom to do what I want”. Much of this freedom arrives from how NFTs open up new ways for artists to reach a broader public of collectors (including new amateur collectors) and speculators. And this occurs globally, unlike in traditional art spaces, where creators and collectors alike are typically limited by the presence (or lack) of brick-and-mortar galleries and other local factors.
Beyond changing how art is traded and accessed, modern digital creations and NFTs can also help artists rethink the work itself and give fresh meaning to what art can be. Artists like the award-winning Refik Anadol use AI to algorithmically make forms, shapes and patterns. Anadol refers to his work as an extension of his consciousness – and such generative pieces and techniques provide a near-limitless playground for an artist to explore concepts and ideas. But digital platforms and NFTs can also benefit art that begins in a more traditional way: GxngYxng’s Ghxsts portraits are hand-drawn, and yet digital versions can be combined into brand-new forms through collectors collaborating.
Rendering of Refik Anadol: Unsupervised. November 19, 2022 – March 5, 2023. The Museum of Modern Art, New York. © Refik Anadol Studio. The project is made possible by Hyundai Card. Leadership support is provided by 1of1. AI software and computing systems to create this work provided by NVIDIA.
NFTs also increasingly carry some utility, which further increases the blurring of boundaries between creators, their work and those who experience the work, through additional and exclusive digital content, stakes in the art itself, and links to real-world objects. Beeple has conceived a wide range of utility NFTs. His prints and signed certificates of authenticity are physical tokens linked to NFTs that echo old-school art. 10KTF, bought by Yuga Labs in November 2022, is an interoperable digital storefront that offers elements of storytelling and allows NFT collection holders to mint unique NFTs featuring their digital avatar on metaverse-ready wearables. And in an interview with Decrypt, Beeple reflected how utility NFTs could further push art’s boundaries, with ‘time capsules’ that unlock content years later – or when specific conditions are met.
Utility NFTs can play a wider social role that impacts on the real world as well, as evidenced by ‘Ghetto Sharkhood’. This art project features 10,000 unique NFTs and brings real-world incentives to users. Proceeds from its play-to-earn games are used to fund programmes that include animal conservation, beach clean-ups and community agricultural programmes in rural areas.
All this activity hasn’t gone unnoticed by the fine art establishment. Having transformed the market and proved their value, NFTs are forcing traditional players to fully recognise digital art in its own right. Galleries like Pace, König and Nagel Draxler have shown interest in launching serious NFT collections. Hong Kong gallery Ora-Ora, which shows many new-media artists, has presented its first NFTs, by Peng Jian and Cindy Ng.
An image posted on the CryptoPunks Twitter page showing Punk #305 hanging on the walls of the ICA Miami art musuem, next to a painting by Andy Warhol.
Having once been reluctant to show digital art alongside traditional paintings, major museums also appear keen to continue embracing and investing in NFTs and digital art. This may help them grow their audiences, expand their reach, remain relevant, better connect with younger tech-oriented people, and retain interest from new and wealthy donors who arrived from the NFT boom.
Accordingly, MoMA and the Guggenheim Museum have hired curators for digital art, and the Whitney Museum has collected several NFTs, including work from Eve Sussman’s series ‘89 Seconds Atomized’. Anadol’s new data-driven installation, ‘Refik Anadol: Unsupervised’, is running in the MoMA’s Gund Lobby. And during Art Basel Miami Beach, Punk #305 by CryptoPunks was placed next to a Warhol on the walls of ICA Miami.
NFT culture was further highlighted at Art Basel when visitors were invited to mint their own NFTs in real-time as part of ‘Performance in Code’. Featuring generative and internet artists, this futuristic interactive exhibition happened alongside a series of talks featuring leading NFT artists from the community.
This inclusive, participatory concept again fostered a connection between audience and artist. Alongside a building market, ongoing interest from creatives, countless innovative digital artworks, and – finally – fuller investment by the art establishment itself, the events at Art Basel only served to further secure the position of NFTs as art.