Crypto Art

Description

Everest Pipkin:

"Cryptoart is a piece of metadata (including, generally- an image or link to an image/file, the creator of that file, datestamps, associated contracts or text, and the purchaser of the piece) which is attached to a “token” (which has monetary value on a marketplace) and stored in a blockchain.

An individual piece of cryptoart is called an NFT. You can think of each NFT as a trading card or a collectible with an individual value that is also affected by the general market value of NFTs as a concept, the Ethereum network and cryptocurrency in general. Like beanie babies without the beans.

Cryptoart is bought and sold with- and has its value calculated in- Ethereum, a 6-year-old cryptocurrency that was (at the time of writing, 2 pm March 2nd 2021) trading at 1 ETH = $1476.21 USD." (https://everestpipkin.medium.com/but-the-environmental-issues-with-cryptoart-1128ef72e6a3)

Characteristics

Everest Pipkin:

"Beyond the ecological the remaining qualities of cryptoart are deeply worrying.

• Cryptoart remakes digital artworks as primarily tokens of monetary worth, content and concept secondary to an asset that has market value.

• Cryptoart creates artificial scarcity for digital objects, creating an “original” which can be owned for the purpose of resale.

• Cryptoart recreates some of the worst aspects of existing art markets, pitting the super-stardom of those who have gotten lucky or who already had money and connections to play with against the realities of countless others who will see no such return.

• Cryptoart offers no intellectual property protection and there is no regulatory structure in place to keep copyrighted materials from being minted into and sold as NFTs, with or without the consent of the creator or copyright holder. Once an NFT is minted, there is no way to remove it from the blockchain or secondary market.

• Cryptoart smart contracts offer no legal protection, and any talk of contracts baked into the NFT “requiring resales to cut in the artist” or “compensate gallery workers” depend entirely on the goodwill of the purchaser.

• Cryptoart lets a few artist early adopters get rich from a system made to reward investors, not artists.

The value system a fully functioning NFT marketplace creates is reprehensible. We cannot let it get there."

(https://everestpipkin.medium.com/but-the-environmental-issues-with-cryptoart-1128ef72e6a3)

Discussion

Everest Pipkin:

"A piece of cryptoart- a non-fungible token, or an NFT- cannot be swapped for another NFT without entering a marketplace. It is not the same thing as a different NFT, even if it has the same value. It cannot be cut in half. A NFT also has its contract and metadata also embedded into the blockchain- things like associated image, creator, date, owner, etc- which is the “art” part of cryptoart.

You can tokenize anything into an NFT; all this means is the metadata of that non fungible token includes information which points to an external asset like an album, a videogame character skin, an image, a url, a house, or a contract. You can also make NFTs without media attached.

To make an NFT, you have to “mint it”- register it on the blockchain. Minting an NFT takes energy, but only abstractly- it gets bundled up into lots of other transactions which take energy to solve as a block, an aggregation scheme which has allowed the NFT market to deny culpability.

To go back to Superrare’s train metaphor, the Ethereum train is running (a new block is minted) every 5 minutes, no matter how many seats are filled. However, what they don’t mention is that the train is really small and seats are valuable. The baseline Ethereum network supports roughly 14 transactions (seats) a second; beyond this, minters enter a bidding war for these seats. A bidding war incentivizes miners to compute blocks with a particular transaction in them, increasing the number of miners working on specific blocks and directly contributing to emissions.

Either way, the artists pay “gas fees” to offset this energy cost.

These fees fluctuate depending on network use, but vary between $40-$1000. These are up front buy-in costs generally borne by the artist that have no guarantee of being returned via sale- and many NFTs sit minted but unsold, with the artist having paid for the privilege.

Once an NFT is on the blockchain, it is “owned” by the person whose digital wallet it is in. Ownership in digital space is a tricky concept, but like all ownership (physical and otherwise) this boils down to a social contract; an NFT is basically a certificate that says “I am the owner of this token and its attached metadata and can do with it as I will, including resell it on a marketplace”.

It is worth noting that there is nothing in place within the technology of an NFT to guarantee that they respect existing copyright (artists have already seen their work minted and sold without their consent, sometimes still with their names attached!) and while the “smart contracts” of NFTs can control their behavior on the blockchain, there is nothing legally binding about them, as they have never entered court.

While minting an NFT doesn’t stop the associated file, image, album, or gif from duplicating or circulating, but it does mean that by this social contract a copy is not “the original” because it is not held by the owner.

There are mixed feelings about this idea- plenty of NFT artists are excited about monetizing images, plenty of people shrugging and saying it is fake ownership and doesn’t change anything about how files work online anyway (tbd- we’ll see how this settles out in legal spaces), and plenty of people horrified to see artificial scarcity imposed on digital objects." (https://everestpipkin.medium.com/but-the-environmental-issues-with-cryptoart-1128ef72e6a3)

Do we really need more capitalism in art ?

Everest Pipkin:

"I’m dedicated to the long work of trying to disentangle society from capitalism and the art world from the speculative art market. But it is so rare that we have a chance to look at a harmful technology before it is deeply embedded in societal systems and simply say: no. We can still do with with NFTs. We can still just not.

Secondly, there is no guarantee that an NFT market replaces something like the art fair (and certainly won’t change things like “cars”).

If anything, a robust NFT market bolsters the idea of the art fair or the blue chip gallery, which have always been about investment, speculation, and resale- even when the work bought or sold is also talked about for its aesthetic, conceptual and emotional qualities.

Not every piece of artwork purchased in a blue chip gallery or at an art fair is intended for eventual profit at an auction house (many simply go on to live on the walls of homes), but every artwork from these kinds of spaces has the capacity to function at auction.

When bought, these artworks have a record of sale and statements of authenticity, and are often couched as “a good deal”- this artist showed at X or Y gallery, they’re undervalued, they’re a hot investment opportunity. And from that point on, it is always up to the purchaser of the work- not the artist- how that piece will function in the future; as an artwork, as a futures investment stored in a warehouse, as a tax shelter, or as somewhere in between.

Some have said that the contemporary art market’s sudden interest in NFTs is due in part to this year of quarantine, where art markets are having to look at other models than the traditional wine-and-dine at Basel to attract buyers, but my bet is just that the art market is just remarkably good at smelling money.

If I had to guess, I’d say the NFT market will replace absolutely nothing- will cause no wasteful, physical art fairs to close- but will instead be folded into existing art fair and gallery contracts. This is because cryptoart is a perfect match to how the art market already functions.

Much like the world of blue chip, some NFTs may be bought and sold simply as artworks, intended for personal collections and acquired for aesthetic, conceptual, or personal reasons. However, every single one is made from the outset to be liquidated- an asset first, artwork second. They are images attached to dollar figures, not the other way around." (https://everestpipkin.medium.com/but-the-environmental-issues-with-cryptoart-1128ef72e6a3)

The only viable option is total moral rejection

Everest Pipkin:

"Anything less (selling, collecting, posting links to artists selling NFTs, yes even trying to find a less ecologically devastating model) holds up the power of the worst parts of this platform. It grants moral grayzone- an “oh, if my favorite artist is involved, maybe it isn’t so bad?” or a “but I know this person cares for the environment and they participate- maybe they know something I don’t?”

I understand first-hand the desperation of trying to live in a world that has systemically undervalued and undercut the arts, and how compelling a vision of escape can be. I truly do want to live to see the world that rewards artists for making the work they would like to make without asking them to jeopardize their health, stability, and creative integrity. This is not just my political belief- it is a desire that would directly benefit me and those I love. It is a future I have to believe in to keep going every day.

However, we must get there through collective empowerment and strong social programs like universal basic income, universal healthcare, divestment from warfare and policing, a regulated real estate market that does not capitalize on housing scarcity and rent, worker unions, food programs, environmental protections, and actual, functioning income taxes on the wealthy. An individualist fantasy of a pyramid scheme, made to reward investors over artists and directly thieving from our shared future just isn’t it.

Many would call me unrealistic and naïve for this, unwilling to make compromises in the world we are living now because of an idealistic vision of a tomorrow; and to them I would like to say that we literally invented an extra-sovereign monetary system that within 10 years has generated trillions of dollars of worth and is held up with the power consumption of a small country." (https://everestpipkin.medium.com/but-the-environmental-issues-with-cryptoart-1128ef72e6a3)