Art and blockchain could have once been thought of as antithetical. But on Tuesday, the Barney A. Ebsworth art collection sale that Christie’s is registering with Artory, a blockchain-based art registry, will put the combination of the two worlds on the map.
The sale is an industry first and a predictor of how blockchain will go on disrupting the art world. From providing transparency in the art supply chain to democratizing it thanks to fractional ownership, blockchain is empowering artists, collectors, and sellers alike. The new wave of crypto and digital artists is magnifying the phenomenon, which triggers some to say that blockchain is even disrupting the very notion of what is art.
With the sale of this collection – that includes artwork by Jackson Pollock and Willem de Kooning – Christie's will become the first major auction house to use blockchain.
Nanne Dekking, Artory founder and chairman of The European Fine Art Fair, says that their blockchain platform provides collectors and buyers transparency and thus, confidence.
Artory will create a digital certificate of each transaction for Christie’s, which will provide their clients with a registration card to securely access an encrypted record of information about their purchased artwork on the registry.
Dekking says that Artory saves buyers time and money when performing due diligence, and that “unlike current bills of sale, which are easily lost or forged, Artory’s standardized certiﬁcates of sale take the headache out of collection management, providing irrefutable proof of ownership.”
For digital and crypto artists, blockchain eases the tracking and distribution of their work, while lowering their costs by bypassing the traditional gallery model. Platforms such as SuperRare and Rare Art Labs allow them to attach a token to their digital work and sell it without a gallery. Another crucial point is that the new platforms have fees in the 0-10 percent range at the moment, while their traditional gallery counterparts usually charge a 50 percent fee to the artist.
Visual artists such as Travis LeRoy Southworth, who has sold a few of his pieces on SuperRare, says he doesn't see this as a replacement of the typical market, but as an additional one. “Just as it took time for people to get used to having digital music, I believe more and more people will become interested in collecting digital art,” he says.
By replacing third parties with blockchain – a cheaper, faster, safer option – the art world is also seeing an emerging marketplace of younger collectors and gallerists. Of course, legacy models will persist, but institutions, such as museums, will also have to adapt to the digital marketplace and integrate blockchain.
Michael Lee, co-founder of Sndbox , a creative blockchain studio, compares the phenomenon to YouTube, which “didn’t wipe out TV, but opened space for new talent that flooded the market.”
“Blockchain makes art more accessible,” Lee says. “It’s not just about buying any more, it’s about how you share and how you trade it.”
Smart contracts also enable a healthier environment and a more ethical way to reward artists, which are usually “a marginal part of the art world,” he says. In addition to tracking their artwork, blockchain also enables artists to ensure their resale rights in an easier way, as well as avoid forgery and counterfeits.
Blockchain is also democratizing art for investors and buyers. With the emergence of fractional ownership and tokenization of artwork, the access to the market is more open and not reserved for the super-rich anymore. In turn, thanks to this fractional ownership, artists have access to more liquidity events and more money to reinvest.
Blockchain platform Maecenas, for example, tokenizes fine art and uses blockchain to create tamper-proof digital certificates linked to pieces of art. Last summer, the firm tokenized a $5.6M Andy Warhol painting. “It was acquired by a number of different investors who participated in the first-ever decentralized Dutch auction for art run on the Ethereum network,” says co-founder and CEO Marcelo García Casil.
Jacqueline O’Neill, executive director of the Blockchain Art Collective – a platform offering blockchain art certificates of authenticity – adds that with fractional ownership, the size of the overall art market will increase, whether from the volume of participants or from the volume of circulating fiat and cryptocurrencies.
“It’ll happen because these barriers to entering the market are lessening, while trust in the claims that the artwork you are buying is, in fact, unique and rare is increasing,” she says.
Nanu Berks, an artist on the platform, says that by just “adding a sticker to my artwork, it instantly has more value through its authenticity than it did without it.”
Vincent Van Gogh said that “great things are done by a series of small things brought together” – a quote which could summarize the power of blockchain in the art world: bringing participants closer together to enrich, create, and share in a more unconstrained way, while challenging social and geographical norms.