Since the start of the year, new investment categories have come to dominate the news cycle. The early days of 2021 have already seen cryptocurrencies reach new heights — whether that’s Bitcoin’s record-breaking run or the Elon Musk-inspired rise of Dogecoin — and retail investors take on hedge funds at their own game. But the fastest-rising example is the soaring status of crypto art, driven by Non-Fungible Tokens (NFTs) to break new records.
Until relatively recently, crypto art was a niche concern, before the huge amounts of money at stake made people sit up and take notice (including Grimes, who recently sold $6 million USD worth of work). At the heart of this is Beeple, a 39-year-old digital artist also known as Mike Winkelmann. The second time Beeple ever offered his work for sale, he sold $3.5 million USD of work in a single weekend. Earlier this month, he went even further and sold an NFT for $6.6 million USD. In a major crossover with the more traditional art world, Beeple’s Everydays: The First 5000 Days, a work created over 13 years, is currently on sale at Christie’s, with bidding already reaching $3 million USD.
“A lot of people are just starting to wake up to the possibilities here,” explains Beeple, who had been making digital art for years, but only got involved with crypto art in late 2020. “I saw people were making good amounts of money making things I didn’t even think you could sell at all. I never pictured having people be able to collect my work like this.”
“It is the beginning of a new chapter in art history.”
In simple terms, an NFT is used to prove ownership of a digital item. “It could be attached to any file, and it says you own this file,” continues Beeple. “Anybody can still view the work, but I think of it like the Mona Lisa. Anybody can view a JPG of the Mona Lisa, but you’re not going to take that JPG and say you own the Mona Lisa.” An NFT, on the other hand, proves that you are the owner of the artwork.
As Beeple says, this ownership model allows people to purchase — and resell — works that had never been collectible before. One example of this is the work sold by Beeple in December 2020, which consisted of digital videos. Breaking from the traditional art world — and traditional art models — has given the crypto art pioneers a rare opportunity to build an industry that works how they would like it to. A key feature of many sales is a sell-on percentage that guarantees the original artist will continue to benefit from the artwork’s rising price. “Having that built in is a way to make this much more sustainable from the artist’s perspective,” explains Beeple. “I think it’ll make the entire market more sustainable, more vibrant, and make people want to share things more instead of wanting to hold onto their work because they’re worried it’ll be worth more in the future and they’ll get nothing.”
Using NFTs as proof of ownership has other implications for the art market. “You’ve got this digital file that cannot be broken, cannot be lost, cannot be destroyed,” Beeple explains. “So you can attach physical goods to it.” He points to his digital videos, which he displays in transparent frames, allowing them to be displayed in a house or gallery similarly to more traditional artworks. “If you hold the NFT, and you get one of these, let’s say you break it. I can go to you and see that you still own the NFT, you still own the artwork. So I can send you another one of these. If you get a painting, it’s going to deteriorate over time. This can live forever and take new forms over time, which is a massive advantage over traditional artworks.”
Beeple is clearly not the only person seeing the potential of NFTs. As well as collectors, artists and new platforms around the world, the big players in the more established art world are starting to get involved, beginning with Beeple’s sale at Christies. “I look at it as a huge validation for this space,” says Beeple. “It is the beginning of a new chapter in art history. People are going to start going back and looking at the digital art that’s been made over the last 20 years, by hundreds of thousands of artists. There was no way to collect their work, there was no technology available to collect their work in a real digital way. People will realise that there was just as much craft, message, nuance and hard work put into this as any other medium, and now we can collect it.”
The importance of this sale is also recognized by Christie’s. “We see this as a pivotal moment for the future of New Media and even the practice of collecting itself,” says Noah Davis, a specialist in the Post-War and Contemporary Art department at Christie’s. For Davis, Beeple’s Everydays: The First 5000 Days is the perfect entry point for the historic auction house’s foray into NFTs. “It is a monumental work, giving viewers the opportunity to zoom in and witness Beeple’s often irreverent but always engaging evolution as an artist, pixel by pixel,” he says. “The capacity to represent 13 years of an artist’s career in a single work perfectly illustrates the limitless nature of this medium.”
“People will realise that there was just as much craft, message, nuance and hard work put into this as any other medium.”
Both Beeple and Davis share the view that crypto art’s surge in popularity — and crossover into the mainstream — are partly due to the COVID-19 and resulting lockdown measures. “This market has been on an upward trajectory over the past few years, but the explosion that we are now witnessing as likely precipitated by COVID-19,” says Davis. “This is a moment when the global community has become fully accustomed to experiencing art through their screen.”
As well as marking a new era of art history, Christie’s is surely also hoping to attract new customers through its move into crypto art and NFTs. “Right now, you’re seeing a lot of younger people wanting to invest in things, and this is an interesting new asset class that you have more ownership over,” Beeple says of crypto art’s new popularity. “The new money is going to want to have work that speaks to them. People who made money in technology, this is artwork that is going to speak to them and their generation and the references they grew up with. Because that’s me as well, the work I do is made for the internet, it’s born on the internet. This is going to bring in a huge amount of people who never thought they’d be interested in collecting art.”
One of these new collectors is Whale Shark, who was an early Bitcoin investor and had previously spoken with HYPEBEAST about his interest in crypto-collectibles. “I had always wanted to become an art collector but was concerned about the learning curve and barriers to entry that the traditional art industry posed to new collectors,” Whale Shark explains. “The advent of cryptoart allowed me to collect anything and everything that I loved in a pseudo-anonymous manner without judgement.”
Reflecting on the growing number of other collectors, Whale Shark thinks the medium aligns with wider events. “With the growing trends of increased internet usage, screen usage proliferation and a general shift from the physical to the virtual world, crypto art made perfect sense as the art for a new generation of collectors.”
While this crossover success is relatively new, crypto art’s rise is built not just on generational shifts but also the well-established digital art movement. “The barrier for the commercialization of digital art has always been the ability to define the provenance and scarcity of a digital art file which is now possible through NFT technology,” explains Whale Shark. “Crypto art is the natural evolution of digital art, as we move into a period of time where our lifestyle as a human race becomes more digital and metaverse-based. This is a critical time for crypto art, as this thesis is finally being recognized by the mainstream and we see the number of creators, collectors and institutions flock into the space.”
While traditional art establishments, such as Christie’s, are beginning to explore this new world, a huge amount of work has already been done by new platforms operating in the space. The sale of Beeple’s Everydays: The First 5000 Days is a partnership with MakersPlace, an online marketplace for digital collectibles. Another platform operating in this space is SuperRare, which describes itself as “Instagram meets Christie’s.” Explaining this description, Jonathan Perkins, one of the platform’s co-founders, says, “SuperRare is an online creative platform akin to Instagram, except that every item is an authentic digital artwork that you can collect and trade.”
“This is going to bring in a huge amount of people who never thought they’d be interested in collecting art.”
One of the reasons that Perkins and his co-founders established SuperRare was in response to the internet giving artist’s an audience but not necessarily a revenue stream. “Because digital files are freely copyable, there has been no direct way to sell digital art to fans and collectors, with all the profits going directly to these big platforms,” he continues, but this is changing thanks to NFTs and platforms like SuperRare. “For the first time ever, digital creators have the ability to issue their artworks as one of a kind assets that can be collected, sold and traded.”
While many people may be dismissive of crypto art and NFTs, Perkins believes that digital art is as deserving of value as any other art form. “The value in these items is in the immaterial,” he says of traditional artworks, highlighting the low material costs used by artists such as Andy Warhol. “It is in the fact that they are authentically created, with a backstory and traceable origin and ownership history. So those most important parts are what we have brought into the digital realm.”
No matter what role people play in the burgeoning crypto art industry — whether they are artists, collectors or the people behind these platforms — all agree that this is only the beginning. Perkins believes that “we are seeing the beginning of a massive revolution in art collecting,” while Whale Shark describes this as “the tip of the iceberg” adding that “a tidal wave of new creators and collectors are flooding into the NFT space.” For Beeple, the sale with Christie’s sets the tone for where digital art goes from here. “I’m excited about the two worlds coming together. I think it’s going to create an explosion of new ideas and new work that feel like a mix of the two.”