Inside NFTs: The Future of Art
For those of you terrified of the words “crypto” and “blockchain”- this one’s for you.
‘Masked Reality 1,’ by Harshit Agrawal on SuperRare
This is the first of many articles I’ll be writing examining the burgeoning digital art market. It’s intended to be a high-level overview for those of you that typically feel lost amongst the technical jargon. In the following sections, we will define the key technologies enabling this growing market and how the underlying concepts can be approached pragmatically by artists and collectors today.
It’s important to state that computer generated art is not new- it's been around since the 1950s. Since then, we’ve seen a proliferation of projects, exhibitions, and sales take place around it. However, given the nature of digital art, it’s all too easy to generate copies and virtually impossible to verify authenticity. This has resulted in a digital art market rife with uncertainties. That is… until now.
NFTs: The New Backbone of Digital Art
The term Non-Fungible Token (NFT) can appear a bit strange, but it's more simple than it seems. To break this down, let's take a look at the difference between fungible [`fun-je-bel] and non-fungible:
Fungible
Represents goods that can be interchanged perfectly in the real world or digitally. They can be easily replaced with an identical item for all intents and purposes.
Example: A $20 bill
Two people can exchange $20 bills and no difference has been made to the item's purpose or value. Each person is still holding a $20 bill.
Example: A can of Coke
Regardless of which can of Coke you pick up, you will be still be drinking Coca-Cola. The cans are perfectly interchangeable.
Non-Fungible
Represents a unique item. Although a subset of items can look similar, they contain distinct details that make them unique. They are considered one-of-a-kind.
Example: A painting
No two paintings are the same. They differ in composition, technique, medium (oil, acrylic, water color, etc) and additional context, like when it was created and by whom.
Example: A plane ticket
They may look similar, but one ticket can take you to New York City in first class and another to Shanghai in economy.
📌 if something is described as non-fungible, it is considered one-of-a-kind.
Intro to Tokens
At a very high level, tokens are the digital representation of an asset and, in this case, they’re represented on a blockchain. For those unfamiliar, blockchains are a secure and public record system. Each record is permanent and cannot be edited.
Another way to think about this is to imagine a digital lock box. When you tokenize an artwork as an NFT, you generate a digital lock box to securely store your artwork and any information associated with it inside. This information is referred to as metadata, and it is permanent and unalterable. Metadata includes information like who the creator is, the date of creation, the medium, transactions made and more.
To sum it up, here are the 3 characteristics that make NFTs are so powerful:
Unique: Each token contains permanent, unalterable metadata associated with it. This can be comparable to a Certificate of Authentication you’d get with a rare painting.
Trustworthy: Because of the permanent, unalterable records, you can trace the provenance back to the creator, along with any transactions that have taken place.
Indivisible: NFTs cannot be divided or split into smaller denominations. They can only be bought, sold or held whole.
📌 A non-fungible token is the secure digital representation of a one-of-a-kind asset.
From Concept to Application: Digital Art Marketplaces
Now that we’ve gone over what NFTs are, let’s take a look at how this concept can be applied.
We’ll review Masked Reality 3, an AI artwork by Harshit Agrawal. It was presented by ARTXCODE earlier this year as part of Agrawal’s solo exhibition, ‘Machinic Situatedness.’
Example of tokenized artwork, 'Masked Reality 3,' by Harshit Agrawal on SuperRare. Aug 6, 2020.
Masked Reality 3 was tokenized by Agrawal on SuperRare, a popular marketplace for NFT-backed artworks. Marketplaces like SuperRare, OpenSea, Rarible and Makersplace make it easy for artists to tokenize their artwork and list it for sale. I recommend looking into the different options out there and see which works best for you as an artist and/or a collector.
It’s worth noting that most of these marketplaces have strict vetting processes for artists. This is not only to confirm the artist’s identity, but to ensure the quality of their works. Once an artist’s identity is confirmed, they can begin tokenizing, or “minting,” their artwork. This is where things get cool…
Screenshot of 'Machinic Situatedness 3' transaction history on SuperRare. Oct 6, 2020.
Once a work is tokenized, the art piece and its associated metadata is now public. The image above is a screenshot of the entire history of Masked Reality 3, starting from the artwork’s inception to its most recent purchase. Given that this is public information, collectors can make informed decisions when purchasing an artwork like never before. This transparency is vital to a healthy art market, free from covert price gouging and fraud.
If you’d like to view Masked Reality 3 and it’s most up-to-date history, click here.
Closing Thoughts: Your Next Steps
We covered what NFTs are and reviewed how marketplaces like SuperRare utilize them for artists and collectors. Although there is more to discuss on the impact and technology behind NFTs, I believe you’re ready to start exploring the territory. Your next step should be to set up a crypto wallet like MetaMask or Fortmatic. These will allow you to buy or sell artwork using Ether (ETH), the currency used on most of these platforms. Additionally, they will double as your secure login credentials instead of your standard username and password. Once you’ve established your crypto wallet, you’re ready to go. Check out any of the marketplaces mentioned above and have at it!
Welcome to the new age of art.
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