It’s a fad! It’s the future of media! It’s your ticket to easy street! It’s a scam! The art world thinks non-fungible tokens are a thing, but are they a thing for you? Your deputy president, David Blumenstein, took a look into them.
An NFT is a token (bit of code) on a blockchain (an online ledger) that provides theoretically unbreakable proof of ownership.
If you’ve heard of NFTs, it’s probably through a breathless news story about venerable auction house Christie’s selling a piece of digital art by a guy called Beeple for $69 million.
Or you heard that the CEO of Twitter turned the first ever tweet into an NFT, and sold it at auction for about $3m.
The idea is that by “minting” an NFT and attaching it to a piece of digital content, you create artificial scarcity for that digital object, meaning it’s somehow more than just a JPEG or other bit of code (which is infinitely copyable).
If you do a painting of a duck, is it worth anything? Sure, if a client has commissioned you to draw it for them. But that’s the end of the transaction.
What if you’re Andy Warhol? Now lots of people will pay for your duck painting. But there’s only one. So you print up one thousand “limited-edition” prints.
They’re only “limited” because you said they are – but you’re a hot commodity, so they are too. Now a thousand people can buy your duck, and you made some good money. Later, they resell their ducks for a huge profit. But you don’t get a piece of that.
Because legal “smart contracts” can be embedded in NFTs, any piece of digital media (say, your duck painting) can now theoretically be considered “unique”, be monetised and be trackable – and, when resold, automatically pay resale royalties back to the creator (in cryptocurrency, of course – we’ll get to that shortly).
The main way NFTs are being used right now is to “mint” digital collectibles. Want to buy a token that says you “own” a “limited edition” digital version of Hokusai’s “The Great Wave Off Kanagawa” (1831)? The British Museum will sell that to you.
Do you like watching “classic catches” on Sunday cricket broadcasts? Expect to see Cricket Australia and Channel Seven auctioning off videos of those catches as NFTs to wealthy collectors pretty soon.
Because NFTs are relatively new, there’s a casino full of techno-utopians, opportunists and out-and-out scammers trying to cash in, quickly, before the hype dies down.
You barely need to peel up the surface to see they’re powered by “boiler rooms” of enthusiasts “pumping” NFT projects – pulling in as many prospective buyers as possible, slavering after the interest of influencers and celebrities, and hoping that once the project launches, the price shoots up and early NFT-holders become wealthy.
If you’ve been around since the early internet, you’ve seen tech bubbles like this before, and if you’re an ACA member, you’ll probably remember the Dutch tulip bulb mania. This is a similar situation.
What’s interesting about NFTs from our perspective is that illustrators are at ground zero of this mania.
Some hope that the technology will “legitimise” digital art, and make it culturally possible to ask serious money for digital artworks. Some are already doing it. One artist I spoke to told me he will “never have to think about doing client work again” thanks to the money he has made from this stuff in the last two years.
The same may happen for my colleague Tim Molloy, a New Zealand comics and gallery artist who, as I write, is about to launch his NFT project, Toddlerpillars, with his friend and collaborator Jon Beinart.
“Art’s been my side hustle, but it became my main job because of the pandemic,” Tim told me. Having lost his day job, Tim started started selling his (actual, physical) paintings on Instagram.
This monkey called Carl is one of the “traits” populating the Toddlerpillars project. “Profile picture” projects like this randomly combine different graphic “traits” to create the NFT images people are buying. Art: Tim Molloy
Because of his exposure to the “serious” art world through the Beinart Gallery, Tim recognised the arts ecosystem at play around him – high-end art is full of scams and hype too – and felt that NFTs might be worth trying, especially with a canny business-minded friend helping him through it.
NFTs are theoretically a “decentralised”, “democratic” way of selling art, with a low barrier to entry. So why not launch an NFT?
Aside from the scene being full of scammers – nobody I’ve spoken to denies this – and the weirdness most of us feel at the idea of selling a JPEG as a “limited-edition collectible”, the big issue is that the computing required to make this technology function consumes electricity at astounding rates, contributing noticeably to carbon emissions.
Artists currently launching NFTs can expect a fiery backlash on social media, which has caused some of these projects to "rethink", or even shut down, in fear of reputational damage. A local game developers' community has just announced they are banning the posting of any blockchain, crypto and NFT-related jobs due to their environmental impact. So let’s try to answer the burning questions around this stuff -- my opinions purely:
Q: CAN MONEY BE MADE WITH NFTs?
Yes. But if you aren’t conversant with the technology and have no particular passion for it, you’re more likely to waste a lot of time than to stack up any cash. As with most industries, the people who get in first, and who build, run and own the sales platforms, have the best opportunity to cash in on them.
In other words – it’s a casino, so you’d better know how to count cards.
Q: IS THIS REVOLUTIONARY TECH?
Techies think so, but techies benefit by puffing their tech up to make it look big.
Blockchain and cryptocurrency are still of niche appeal because they’re largely seen as an investment vehicle (an unstable one). I think NFTs are the latest way they hope to entice “normal people” into using this stuff.
At the same time, the NFT projects they create are so full of in-jokes and complex rules, and so steeped in performative libertarianism, you need to be a tech bro (or “bro-sympathetic”) to get involved.
When the emissions problem is solved, everything could change, but the culture around NFTs might still be a barrier.
Q: ARE THERE TRUE BENEFITS FOR ARTISTS HERE?
Short answer: not yet. NFTs still seem to me like a solution in search of a problem, at least as far as artists are concerned.
Slightly longer answer: artists are good at adopting new tech and doing interesting things with it. That only happens when artists direct the projects, though. Right now, I think most NFT projects are the domain of the techs who understand it and the venture capitalists who fund it.
When more artists have their hands on the levers, things could change, and you’ll see the same pattern with NFTs that we saw with the Web, MP3s, YouTube, podcasting, crowdfunding, etc: early adoption by people doing interesting experiments, artists figuring out how to draw an audience, the public catching on, the scene stabilising as artists learn how to make money from it, corporates and celebrities sweeping in and the scene becoming homogenous because it’s now big business.
Q: SHOULD I GET INVOLVED IN NFTS?
If you should be involved, you probably already are.
I’m pretty excited for Tim’s project to do well, because, frankly, Tim is an amazing artist and deserves the success. For Tim it’s been a roller-coaster. In a short couple of months he’s gone from a struggling artist working alone in his home to potentially presiding over a mini arts empire. NFTs aren’t responsible for that, though. Tim’s skills and Jon’s business mind are.
If any of this genuinely sounds interesting to you beyond the promise of financial reward, go for your life. Just remember that the hype is everything. If you’re not successful in your art practice currently, and you don’t have a Charles Saatchi to bid up your NFT art to $69 million, you may not come out of this casino ahead.