Art in The Time of Crypto: Decoding the Hype Behind NFTs

It’s a simple JPEG, comprising of 5000 digital images, all handcrafted by the artist himself. At first glance, it’s a discordant collage of inconsistent colour schemes, which is of no surprise because all the artist has done here is smoosh together various digital art pieces of wildly different styles and sizes, without any apparent order. Yet, it’s, undoubtedly, entrancing. Like a Pollock, there’s something alluring about the rainbow-coloured bedlam. As you zoom in, you start to see the bigger picture. The composition is varied and meticulously detailed; unique text art, sketches, portraits, gothic imagery straight from Dark Souls, cyberpunk-ish landscapes, childishly hand-drawn pictures fit for pinning on the refrigerator, the skill and variety are endless. It’s not your typical Monet or Picasso, rather, a classic example of postmodern art, channeling the spirit of Warhol and Basquiat. All within 21,069 by 21,069 pixels.

In early 2021, this image sold for an astronomical $69.35 million (₹520 crores) at a Christie’s auction. Titled ‘Everydays: the First 5000 Days’, it was sold as an NFT or Non-Fungible Token and currently holds the title for the third most expensive work of art ever sold by a living artist. There’s a burning question waiting to be answered here. How does a JPEG fetch a hefty price tag, without having a physical presence and capable of being duplicated easily from the Internet? The mastermind behind this, Mike Winklemann, operating under the pseudonym Beeple, when asked about it, replied “If everybody wants it, well, then it has value”

The world of crypto is a fascinating one, strapped with endless possibilities of changing how we perceive our hyper-connected society, waiting to be implemented in due course of time. Crypto-commodities are the new hot thing. But the intrigue comes from the craze in the digital art and collectibles industry. NFTs are changing the way how one views ownership and obtaining art. In its purest form, Non-Fungible Tokens are precisely what it means: untradeable tokens or stamps used to represent ownership of any unique asset, like a deed for an item in the digital or physical realm. It can be a painting, a video, music clips, doodles, videos, toys, etc. This artist is not selling the art, rather the buyer is, figuratively, buying the ownership of it, The object of purchase is a string of code, attached to the artwork, whose authenticity is verified on the Blockchain. Anyone can go online and download a copy of it but its status of ownership is immortalized in a Blockchain i.e the token cannot be replicated. And the NFT market is seeing exponential growth. DappRadar, which tracks blockchain sales, saw that in the second quarter of 2021, NFTs raked in $2.4 billion, slightly above the first quarter’s $2.3 billion. Yet, the novelty in buying NFTs, some elegant, other’s straight-up wacky, is baffling but the history of purchasing art and human psychology is deeply intertwined with each other.

Buying art is an ancient practice. The rise of materialism in a blossoming bourgeoise class of the Renaissance era skyrocketed the demand for art. It was not just to adorn chateaus and summer houses with exquisite paintings and sculptures but to demonstrate one’s reputation and social status. Clients, like the wealthy or establishments like the Church, would hire artists and instruct them to paint and sculpt according to their preferences. Art was an investment, an unpredictable, risky one at that. It’s not a liquid asset that can be sold easily, the subject matter is often personal to the client so tastes will differ, and selling art is often associated with debt, death, and divorce. The life of an artist depended on their client and while it did seem restrictive in terms of subject matter, artistic expression and freedom were never compromised and the results are nothing short of mesmerizing. The periods of art that followed it such as Baroque, Neo Classicalism, Romanticism, Realism, and Modernism, coupled with the industrialization of the 19th and 20th centuries, changed how we produce and consume art. Art is not just strokes of paints on a canvas or Greek gods sculpted from marble and granite, it’s space and sound and perception. The artist is free now, not relying on the patronage of a rich oligarch or the Church because there’s an active market. Anyone can be an artist and art is evolving, transcending conventions as well as creating new ones. Despite the paradigm shifts and hundreds of years of change, certain fundamental principles have proved themselves unshakeable. And it applies even today.

From history, we can draw the fact that art serves two purposes. One, aestheticism; art for the sake of art. It exists as both decoration in the physical sense and, most importantly, as an expression of human creativity. As Aristotle put it, “The aim of art is to represent not the outward appearance of things, but their inward significance.” There’s no senseless art, just misinterpretations. To delve into the philosophical nature of aestheticism is work for another day but it’s crucial to fathom art and its significance in human history. Second, for economic purposes; art for the sake of status, giving a feeling of victory, in the sense, the superiority of holding a unique, original work of art. It contributes to a social distinction that gives pleasure for possessing something that’s one of a kind. These are the valid justifications for purchasing art and it’s a practice that won’t fade any time because it’s indoctrinated in society.

NFTs exist in the realm of ones and zeros yet it fulfills art’s two purposes It fits the parameters of any artwork albeit there are a few catches to it. The Internet has now integrated itself deeply into society, its interconnectedness and omnipresence so well mesh with our current state of affairs to the point where it’s impossible to remove it completely from our lives. While NFT’s are not tangible, owning something digital is as good as buying something in the real world. NFT’s gain traction because of their rarity and such is the case for any antique. Two factors influence the antiquity of art; the number of people who want it and the number of people who readily acknowledge its ownership. NFTs produce a unique token that cannot be replicated and the Blockchain, verified by innumerable nodes, ensure it’s in the right hands. Validation is key here. It’s not about owning it but also let others know that someone owns it. This is a working example of the psychological concept of needs and wants. Many jump on the NFT bandwagon because it’s easy to purchase and the prospect of holding ownership of authentic art is tantalizing. This induces the “hype” that’s thrown around in news article headlines and it’s quite obnoxious. Yes, the art is unconventional and, at times, not even art, like a clip of Lebron James dunking or the doodle of a poorly scribbled word yet it does classify as art. The subjectivity of art is a fiercely debated topic and will not be brought here but NFTs do have greater purposes that contributed to its popularity.

The combination of art and Blockchain seems unorthodox but NFTs show some hope that it can perfectly coexist. The art industry has always faced challenges in transparency, authentication, provenance, etc and Blockchain provides solutions for it. The decentralized marketplace means art can be bought more effectively and, paired with the absence of a central clearing authority, with virtually zero paperwork. Digital art can now be taken as a serious form of art as a result of the Blockchain. Cryptocurrencies can facilitate large transactions to whoever and at short notice, with ease, sans any sort of banking services. The biggest advantage is the accessibility NFTs provide in terms of purchasing art. It’s not an activity reserved and specifically enjoyed by the rich who can afford to spend millions and millions. Anyone can now be an art collector as it’s now possible to purchase art directly than through third-party agencies like auction houses. Blockchain is revolutionizing the glamorous world of fine art auction houses such as Christie’s and Sotheby’s as well, mixing centuries-old traditions with cutting-edge technology. But NFTs are not without their valid criticisms. The NFT mania, fueled by media outlets, is waning with daily sales decreasing by the week. NFT marketplaces are oversaturated with artists eyeing on making a quick buck. Furthermore, news that the NFT bubble is about to burst, caused by media frenzy and stratospheric sales, gives the image that NFTs are just a fad that’ll drown in the white noise of our ever-changing technological landscape.

The impact of NFTs and Blockchain is changing not just the inner machinations of the art industry but the overall perception of art. Despite the skepticism, the future for NFTs seems bright, as it will, inevitably, find a way to adapt to the modern age and continue to lead a quiet revolution in how we produce and consume art.

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