Can NFTs and Ethereum rejuvenate the art scene?

By Dan Israeli

 

Is art dead? 

The evolution of graphic design and digital art has opened the door for new mediums to emerge in the 21st century, but not in a way that has spawned a following or culture quite like the art gallery scene of New York City in the 1980s. 

At least, not until very recently. 

 

A Man of the Beeple

A pixelated green background with the Ethereum symbol superimposed on top.

Mike Winkelmann, a digital artist/graphic designer based in South Carolina, used to sell custom prints for $100 tops. In October 2020, however, he sold a pair of works for $66,666.66 a pop. Then in December, another work went for $3.5 million. And in March 2021, after already establishing a pretty strong following under the pseudonym Beeple, a piece of his titled “Everydays: The First 5000 Days” was auctioned off by Christie’s for a staggering $69.3 million. 

So… what happened? How did Beeple become the biggest thing to hit the art scene in quite some time? For starters, it’s important to note that “Everdays” was not paid for using $69.3 million in cash, but rather 38474.82 ETH (i.e., Ethereum). And it wasn’t your ordinary work of digital art — it was an NFT.

 

What’s an NFT?

A framed picture of an Ethereum symbol, surrounded by cubes. 

Some of you may be asking the above question, while others just need a detailed refresher. Perhaps the biggest buzzword of the 2021 crypto scene, an NFT (non-fungible token) is a form of a crypto asset. Specifically, it acts as a digital representation of a unique asset, hence making it non-fungible. Typically, a crypto asset ― like one bitcoin — is fungible, as it can be exchanged for another bitcoin at equal value. They are one and the same. A non-fungible token, however, is unique and cannot be replicated or swapped for another seemingly identical NFT. 

If this is confusing, just view an NFT like any crypto asset validated and recorded on a blockchain, although instead of being mined, it is minted (i.e., created) via a smart contract, which also assigns its ownership and transferability. As the world’s largest blockchain network for smart contracts, NFTs are mostly minted on Ethereum.

INVEST IN ETHEREUM TODAY

Now that we know how NFTs are created, what are they exactly? Many things. An NFT’s main utility is to verify ownership, which can be for a digital asset (e.g., digital art, video/gif, music, video game, domain name) or physical asset (deed, title, ticket, legal document, signature). Like all crypto assets, NFTs are immutable, meaning their properties and ownership cannot be altered, which solidifies their authenticity over time. 

 

CryptoPunk Rock

The reason Beeple and several other artists have thrived off NFTs is largely due to a major pain point they solved in the digital art space ― owning an original. Before NFTs, it was very hard to prove you owned an original digital work, as files can be shared and/or multiple copies can be printed. However, 1-of-1 NFTs give collectors the exclusivity they seek when buying a piece of art. 

Artists can also independently sell their NFTs on popular marketplaces like OpenSea, Raribe, and SuperRare, with no need for a middle-man or other platform that cuts into their earnings. That makes NFTs very punk rock, which just so happens to be the inspiration for the most popular (and one of the oldest) NFT art collectibles, CryptoPunks. The unique, 8-bit style pixel art images are regularly sold for in the millions (when converted from ETH), as there are only 10,000 of these highly coveted head shots in circulation. 

 

Ethereum Delirium 

NFTs aren’t just a great development for the art/collectible industry; they are proof that blockchain networks like Ethereum are creating crypto assets with utility beyond payments. Ethereum is currently merging to its 2.0 (Eth2), which will increase the platform’s scalability and greatly expand the possibility of smart contract projects going forward.

If you’re interested in jumping on the Ethereum bandwagon, eToro allows you to invest in ETH and countless other top crypto assets available in the marketplace quickly and easily. 

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