The Rise of Web3 in Art: A Look into the Future | 🎠|
AND our collaboration with Techy Girls to empower women into Web3.
GM. 🫶
This is Web3 Espresso ☕—the Web3 Newsletter for creators, marketers, and coffee drinkers looking to understand how Web3 technology is changing the world we live in.
Hello 😎,
Non-fungible tokens (NFTs) are said to have revolutionised the way that artists can monetize their digital works. A little like how Spotify and Deezer forced the music industry to rethink its business model, the visual arts world could very well be poised for a big change.
I recently had the opportunity to listen in on an AMA (Ask Me Anything) with the team behind Unveil, a platform for curated photography NFTs. This talk made me think about how Web3 technology and, more specifically, NFTs are changing the well-established relationship between artists, curators, and collectors.
Does this model still hold?
What are the opportunities and challenges for artists to thrive in a Web3 world? Looking ahead, will the gatekeepers of the art world still be needed and valued?
Read on.
What’s in store today:
🥡 The Weekly Roundup 5 in 5
☕+👧 Teaming up with TechyGirls
🎠The Rise of Web3 in Art: A Look into the Future
The rise of digital ownership in art
How decentralisation is removing the middlemen in art transactions
The impact of community-driven projects and collaborations
NFTs are a game-changer for artists; here's why.
Will NFTs stand the test of time?
Why the art world still needs gatekeepers
Let’s go! 🥤
🥡 5 in 5 …
The Five Stories You Need to Know This Week
The Art Basel Market Report 2023 is out 👉 get it here
Sotheby’s launches its curated NFT Marketplace 👉 see it here
Event: Web3 Meets European Regulation & Policymak 👉 see it here
Michelin launches its “3xplorer Club’, NFT collection 👉 see it here
Sports Illustrated launches its NFT Ticketing Platform 👉 see it here
☕+👧 Teaming up with TechyGirls
Today, the world of Web3 is undeniably male-dominated. Yet, I firmly believe that women can play a key role in creating a vibrant and diverse community of Web3 thought-leaders and builders.
I recently had the opportunity to meet Estelle Favier, the founder of a Monaco-based association (NGO) called TechyGirls. Estelle is an established digital artist and a firm believer in women's inclusion in Web3. Through her NGO she wants to provide a friendly environment in which women can learn about Web3 and work together.
I fully support TechyGirls' mission to build a more diverse and inclusive Web3 community and to encourage female participation in the ecosystem. I have decided to collaborate with TechyGirls by including them in this newsletter and showcasing their art.
Let me know if you enjoy the art!
If you want to collaborate with Web3 Espresso and be featured, send me a DM and let’s get to know each other.
| 🎠| The Rise of Web3 in Art: A Look into the Future
Introduction
Web3 is the decentralised web that operates on blockchain technology. Although it is still in its infancy, this technology is already transforming many industries, including the art world.
With the emergence of NFTs and decentralised platforms, artists and art enthusiasts are experiencing a revolution in the way they create, sell, and appreciate art.
In this blog post, I explore how Web3 and NFTs are changing the traditional art market, how they are creating new opportunities for artists, and whether they will stand the test of time.
NFTs: The Rise of Digital Ownership in Art
The idea behind Web3 is a decentralised internet where users are actors rather than passive observers of what happens online.
A lot of people hate this idea (or don’t understand it).
Web3 enthusiasts love it. Why? Because it gives the people who are producing the art (or the content) the power and the chance to communicate directly with their audiences.
One of the most significant changes that Web3 brings to the art world is the ability to create unique digital art pieces using NFTs.
Because NFTs are non-fungible, each token is distinct and cannot be exchanged for another token. They can be used to confirm the legitimacy and ownership of works of digital art, online.
Using blockchain technology to confirm ownership and authenticity, NFTs enable creators to sell ownership rights to digital assets like art or music.
Beeple's "The First 5000 Days," a digital artwork that sold for $69 million in March 2021, is an illustration of a successful NFT transaction. After Jeff Koons and David Hockney, Beeple is now the third-most expensive living artist thanks to this sale. The sale of "The First 5000 Days" marked a turning point in the NFT industry and showed how Web3 could produce valuable and distinctive works of digital art.
Decentralisation: Removing the Middlemen in Art Transactions
Web3 technology is also creating a decentralised art market.
What does this mean?
Web3 technology is enabling one-to-one relationships between artists and collectors by removing middlemen from art transactions.
Because they have considerable control over the purchasing and selling of artworks, intermediaries like galleries, auction houses, and dealers have long dominated the traditional art market. These intermediaries often charge high fees, limiting the accessibility of the market to artists and collectors alike.
Also, artists who aren't well-known or represented by a gallery are faced with the challenge of making themselves known to gatekeepers of the art world in order to get exposure and sell their work.
These obstacles are removed by a decentralised art market. New online platforms are emerging to replace these gatekeepers, allowing more direct communication and exchanges between artists and collectors. These platforms have the power to expose new talent to a global audience. Artists can choose to promote their art on global platforms like OpenSea, SuperRare or Nifty Gateway or choose more specialised art curation platforms (see below).
5 NFT Platforms for Fine Art Photography
Community-Driven Projects and Collaborations
The value of community is the first thing newcomers to the crypto space notice. A commitment to openness and decentralisation sits at the heart of the vision behind Web 3. On the flip side, for this idealistic framework to function properly, there needs to be alignment and collaboration amongst users. Numerous community-driven initiatives have grown as a result, including in the world of art.
Decentralised autonomous organisations (DAOs) are one of the most prominent examples of community-driven projects in Web3. DAOs are organisations with smart contracts as their rules, allowing for decentralised decision-making and community involvement.
I recommend reading Forbes’ recent article on how crypto artists are experimenting with Web3 tools.
Through decentralised decision-making, DAOs are revolutionising the way that artists and art enthusiasts collaborate on creative projects. DAOs are giving artists a platform to connect with a community of supporters and work on projects in a more democratic and transparent manner by utilising the power of Web3 technology.
One example of a successful DAO project is FlamingoDAO's purchase of a Banksy artwork in March 2021. The DAO raised $95,000 through a token sale and used the funds to purchase a physical Banksy artwork, which was then burned and turned into an NFT.
NFTs are a game-changer for artists; here's why.
Authenticity
Proving the authenticity of a piece of art is not a new challenge. The industry currently relies on art experts to validate the authenticity of paintings. This can be more difficult to do with fine art photography. NFTs provide a unique digital signature that proves ownership and the authenticity of an artwork. This can help prevent copyright infringement and piracy as well as establish a clear chain of ownership and provenance.
Scarcity
Prints are inherently replicable. Artists may issue different editions that may devalue another version of the print. NFTs are a solution to digital scarcity. By tying ownership of natively digital artwork to an entry in a public, immutable ledger, the artwork becomes collectible, and scarcity can be built in, albeit artificially.
Creating an inclusive art market
The art world bakes in exclusivity. Curators and galleries, who served as historical gatekeepers, uphold the barriers to entry for both collectors and artists. Web3 technology and particularly NFTs are leading to a change in the way that art is traded and even defined. Creators of digital artworks can sell directly to collectors through a curator platform, cutting out historical dealers and galleries. Can NFTs be the catalyst that makes the art world more inclusive?
Access to recurrent revenue
The traditional art market’s revenue model is based on the sale of prints, stock licencing, or books. In this model, artists have not benefited from the resale of their own work. NFT contracts can have a built-in feature that automatically gives artists a cut on any resale transaction in the secondary market, ensuring a long term revenue stream.
Control
NFTs can offer photographers and artists more control and flexibility over their work, such as setting the terms of the sale or licencing of their creations, setting conditions for future use of their work, and keeping the copyrights to their work.
Will NFTs stand the test of time?
We’ve examined the benefits of NFTs for artists and how they have the potential to revolutionise the art world. But will NFTs stand the test of time?
I think it’s all a matter of perspective.
While auction houses such as Christie’s and Sotheby’s are building teams to specifically handle issues around their digital assets, there has definitely been a cooldown in the NFT world. According to the latest numbers from Art Basel’s 2023 Art Report, overall sales of art-related NFTs reached close to $1.5 billion in 2022, a decline of 49% year-on-year between 2022 and 2023. The significant decline in the value of Ethereum (also known as the "crypto winter") and the exodus of NFT speculators can both account for this.
Let’s examine the risks and challenges facing NFT art:
The NFT hype will die down.
It has become clear to what extent speculators and crypto-fans, who only wanted to drive prices higher, were driving 2022 market activity versus collectors. Looking ahead, the challenge will be to find collectors who are genuinely interested in the underlying artwork.
Cryptocurrency is notoriously risky.
Cryptocurrency thefts have happened in the past. Extra precaution is needed to ensure that the digital wallets of both the artists and the collector are properly secured against hacks, theft, and other cyber threats. Also, as there is no central regulatory body, any case of fraud would be a fait accompli.
Cryptocurrency is volatile.
One of the biggest concerns with cryptocurrency payments is their volatility. The value of cryptocurrencies such as Bitcoin and Ethereum can fluctuate rapidly and unpredictably, which can make it difficult to know exactly how much an artist’s work is worth at any given moment.
How do you value digital art?
More fundamentally, there is still a lot of uncertainty about digital art valuation. For paintings, for example, there is a price hierarchy among artists because decades of trade information exist. For contemporary artists, a whole ecosystem of galleries, fairs, and critics determines market values, and even the definition of art. How do you value artwork that does not have a sales history?
Why the art world still needs gatekeepers
Finding fresh ways to make money from your art and making a name for yourself in a crowded market can be challenging for artists. The conventional channels for selling art might be constrained and frequently call for dealing with galleries or agents. This makes it difficult for an artist to achieve recognition and provide a stable income.
We have seen that NFTs are upending the art world and providing artists with new ways to sell their creations directly to their buyers.
So why not cut out the middleman?
Here we examine why the gatekeepers of the art world can still add value, especially for new and emerging artists.
5 reasons gatekeepers still have a place in the art world:
Expertise
Art intermediaries frequently possess years of market knowledge and experience. They can offer artists insightful guidance on pricing, marketing, and promotion. Also, they can help buyers make decisions about which pieces of art meet their preferences and price range.
Credibility
Art middlemen can aid in establishing an artist's reputation and the worth and demand for their work. Also, they can give purchasers reassurance that the artwork they are buying is genuine and of high calibre.
Access to Buyers
Art middlemen are connected to collectors, institutions, and other galleries through their existing networks and contacts in the art world. They can take advantage of these relationships to promote artists' work and sell it to customers who might not otherwise be aware of them.
Promotion
Art middlemen can handle exhibition planning, catalogue design, and advertising in addition to marketing and promoting an artist's work. By doing this, artists may save time and money while ensuring that their work is presented in the best possible way.
Sales and Negotiations
Art middlemen can also manage sales and negotiations on the artist's behalf, freeing the artist to concentrate on producing new work. They can make the most of the value for consumers while also ensuring that artists are fairly compensated for their contributions.
Concluding thoughts
So, will NFTs really take over, as some people predict? Or will the trend fade away forever?
I don't have a crystal ball, but it seems to me that the internet is serving as the world's great leveller, just as it did in eCommerce.
The exclusivity of the art world is eroding, and artists who find their voice and a community to support them are receiving recognition and compensation.
This is by no means a simple task because it also requires artists to actively participate in the distribution of their work, a role they might not want to play.
It's still very early. NFTs were only developed a few years ago, and the market for NFT art is still only a drop in the vast sea of traditional art.
It also implies that there is room for growth.
I firmly believe that, at its core, the reason an art collector buys art is to enjoy it, and that ultimately, the ability of curators and museums to exhibit digital art for the benefit of all will determine the future of digital art.
That’s all for this week… 🫶
Please note that I do not recommend or endorse the companies and organisations mentioned in this newsletter. This content is purely informative and not a recommendation. Always be mindful of where you connect your wallet. Always do your own research. 💛