Mass media holding company iHeartMedia is planning to distribute free nonfungible tokens, or NFTs, in partnership with sustainable NFT platform OneOf — a campaign that could introduce more music lovers to digital collectibles.
The campaign is intended to promote the 2021 iHeartRadio Music Festival in Las Vegas on Sept. 17-18. Beginning on Tuesday, users can claim one free NFT “poker chip” directly on the OneOf platform. Up to 1 million tokens are claimable through Sept. 14. Users who collect an entire set are eligible to receive a limited edition NFT by artist Cory Van Lew. As Cointelegraph reported, Van Lew is the digital artist behind Mike Tyson’s NFT collection.
Lew’s NFT drop will take place on Sept. 14 and will reflect OneOf’s ethos of “Artist First,” “For All Fans” and “Eco-Responsible.” The companies said collectibles in the higher NFT tiers include digital autographs from artists performing at the festival. Fans can obtain these NFTs by making a donation, with 100% of the proceeds going towards climate change initiatives endorsed by the United Nations.
Although the companies didn’t specify which artists included their signatures in the NFT collection, the festival includes performances from Billie Eilish, Coldplay, J. Cole, Khalid, Maroon 5 and many others.
As Cointelegraph reported in May, OneOf raised $63 million in support of its so-called green NFT platform targeting musicians and other artists. The Tezos-powered platform serves as a marketplace for artists and fans to mint, purchase and share digital collectibles.
Related:Visa whitepaper describes NFTs as a ‘promising medium for fan engagement’
The iHeartRadio Music Festival will shine the spotlight on the NFT market, which continues to attract influencers, mega corporations and high-profile investors. NFT sales reached $2.5 billion in the first half of 2021; if recent trends are any indication, the market could easily surpass that total in the second half of 2021. Case in point: NFT sales approached $900 million in August, more than tripling the previous monthly high set in May at $255 million.
Related:Investors are shelling out six figures for pet rock NFTs
Although the CryptoPunks collection has dominated the spotlight in recent months, digital collectibles in other niches are also attracting serious capital. Pet rock NFTs centered around Ethereum have generated millions in sales, with the most expensive item in the collection going for a resale price of $1.9 billion.
Damien Hirst, a contemporary artist known around the world, talked about similarities and differences between artwork and fiat currency as he prepared to drop 10,000 NFTs tied to his physical paintings.
Speaking with Cointelegraph’s Andrew Thurman at his London studio in May, Hirst answered questions in a magic 8-ball fashion, by opening up one of the boxes containing hundreds of sheets of his The Currency artwork collection and reading a sentence off the back of the paper. Though the immediate answers were not always on topic — is Satoshi really a cliche? — the artist laughed at the absurdity continued to voice his thoughts on money and art.
In particular, Hirst said people believe money has value because it gets “a little leg up with art,” an argument similar to what many critics have discussed about social media pumps and dumps of tokens: some prices only rise because of inflated value driven by high profile figures, i.e. giving a project a little pizazz. The artist said he would “love it” if someday someone were able to use his The Currency artwork as actual currency given its value as a nonfungible token, but believes most people will choose to keep the physical painting. With this view, he still sees the technology as eventually revolutionizing the art world.
“I just saw [NFTs] as a really amazing thing,” said Hirst. “I saw it like the invention of paper.”
He added:
“We already live in a world where you can have artworks, prints, and editions, and then it seems like you can have artworks, prints, editions, and NFTs […] with NFTs I think it’s changing the world, and it will change the world.”
Hirst created the physical paintings behind The Currency in 2016, long before many in the crypto space or art world were aware of nonfungible tokens, or NFTs. He plans to allow art enthusiasts to purchase each “Tender” — a high-resolution photo of one of 10,000 unique paintings featuring a pattern of colored dots — for $2,000, giving them the choice to keep the NFT or trade it in for the physical version.
Related:British artist Damien Hirst uses NFTs to blur the boundaries between art and money
The British artist didn’t hold back expressing his views on creators maintaining control of their work, saying he was annoyed by apps like iTunes seemingly taking ownership from musicians. However, he said NFTs allowed artists to own their creations:
“You can own something digital, and it can be yours,” Hirst said.
The Currency opened for users on Wednesday, allowing people to apply for a chance to purchase one of the 10,000 NFTs. Applications close on July 21.
As nonfungible token (NFT) art continues to develop as an industry, a new trend is quickly emerging: physical NFT galleries featuring digital, nonfungible pieces of unique artwork. Most recently, the largest Bitcoin (BTC) event in history — the Bitcoin 2021 conference — featured a peer-to-peer pop-up NFT art gallery with artwork from over 30 different crypto artists.
Teodora Atanasova, VIP relations manager and founding team member of Nexo — the company that backed the Bitcoin Art Gallery — told Cointelegraph that over 100 pieces of art were sold during the two-day conference: “This demonstrates the impact physical NFT galleries can have on both the traditional art world and the crypto industry.” She added: “We need to bring crypto to people’s eyes and touch.”
Popular crypto-friendly cities like Miami are not the only places where NFT art galleries are appearing. Earlier this month, an NFT art gallery pop-up took place in Dallas, TX for the first time. The event was hosted by Artist Uprising, a Dallas-based talent agency for creatives, and featured several individual art pieces by breakout NFT artists who have collectively grossed over $1 million in online digital art sales in the last month alone.
Merrick Porchéddu, CEO of Artist Uprising, told Cointelegraph that the event attracted over 200 attendees, with NFT sales still ongoing in open auctions:
“Many prints were sold, along with two fine art canvases. The ‘Making of NFT Gallery IRL’ documentary was also filmed (which will hopefully explain so much behind what NFT art is all about and why it is here to stay). Also, we now have three districts wanting to bring our NFT gallery to their spaces.”
“So Happy We Met” NFT artwork by Magdiel Lopez. Source: Artist Uprising
Understanding the need for physical NFT art galleries
Yet while physical NFT art galleries are a notable step for the crypto industry, some art aficionados, or traditionalists, may question the importance of, or even the necessity of, NFT art galleries in the real world.
For instance, an article in The Art Newspaper quotes Saskia Draxler, co-owner of German art gallery Galerie Nagel Draxler, who noted that the digital artist Beeple — who auctioned off a piece of NFT art at auction house Christie’s for over $69 million — will most likely not impact art history. She added that “NFTs will not replace physical art any more than NFTs from a Nike sneaker will replace real sneakers.”
Related: NFT ‘art revolution’: Beeple on his 5,040-day labor of love
While this is just one opinion, some believe that the confusion around NFTs and the need for physical galleries may stem from a lack of understanding. Carrie Eldridge, founder and CEO of ATO Platform — an asset management service providing royalties to artists, galleries and nonprofits — told Cointelegraph that there are many pragmatists and conservatives who are not ready to embrace NFTs as a legitimate medium. “They also don’t believe that NFTs provide a solution to challenges that have plagued artists for generations, like value tracking, royalty collection, collector analytics, value appreciation for collectors and insurance companies and many more complex issues,” she said.
Although this may be the case, Eldridge noted that it’s important to consider perspectives from both traditional collectors and the crypto community when it comes to NFT art: “At ATO we are enthusiastic about the innovation and at the same time, are vigilant and protective of the art industry and those who have toiled for decades to make it what it is today.”
While Eldridge brings up a valid argument, it’s important to point out the reason that physical NFT galleries have appeared in the first place. While some may think that these venues opened simply as a result of lifted COVID-19 restrictions, industry experts beg to differ.
For example, Marc Billings, founder of Blackdove — the company that launched Miami’s first NFT art gallery earlier in June — told Cointelegraph that NFT art galleries are no different than traditional galleries in form and function. However, he noted that traditional art galleries have failed to meet the needs of the NFT artist, both in terms of technology and collector interest, thereby opening the door to dedicated NFT galleries. Billings said:
“NFT artwork more closely resembles a moving painting than a traditional work of video work, which has been missed by the more conservative art world. Artists and curators are starved for wall space to showcase their works and voices that the NFT gallery is uniquely positioned to handle.”
In addition to digital NFT artwork being displayed in real-world spaces, NFT artists have also started to create physical pieces that are associated with their digital creations. Not only do physical NFT art galleries allow these pieces to be displayed, but they also help attract interest from the mainstream.
For instance, NFT artist Taylor Good — also known as “Warhodl” — told Cointelegraph that by creating physical soup cans tied to digital NFTs, his pop-up at Bitcoin 2021 attracted collectors who were new to the NFT space.
Bitcoin original can NFT artwork by Warhodl. Source: Warhodl
Echoing Good, crypto artist Sergey Gordienko — also known as “Do What You Love Artist” — told Cointelegraph that he is offering physical pieces of NFT art to traditional collectors along with their digital versions. “I think this brings additional value to the physical art piece,” he said.
Bitcoin artwork by Do What You Love Artist. Source: Sergey Gordienko
NFT art and the importance of blockchain
While it’s important to recognize the necessity of physical NFT galleries, Billings also pointed out that blockchain technology plays an important role in the overall ecosystem: “Blockchain allows the hard work of the various members of the community to be recognized and compensated accordingly.”
Indeed, blockchain is one of the most important features behind NFTs in general, as it has created an entirely new financial model for these assets. This has enabled creatives to achieve a larger portion of profits, as value is exchanged across a blockchain network. In addition, proof of ownership is achieved for collectors because all transactions are conducted and recorded on the blockchain.
Good explained that NFT art has allowed him to receive profits in real time, instead of waiting for galleries to accept, price and then sell the item:
“The age-old issue as an artist is knowing your worth, asking for it, and actually receiving your worth. While NFT’s are simply a utility of the blockchain, the creative world is lucky to be one of the first vehicles or use cases, because what NFTs essentially are is a direct value exchange.”
Moreover, the decentralized finance (DeFi) protocol Aave is currently working on developing a platform to use NFTs as collateral. Jordan Lazaro Gustave, chief operating officer of Aave, told Cointelegraph that the company views NFTs as a store of value, typically in the form of artwork. He noted that Aave plans to use NFT art as collateral, similar to the way a bank would offer a credit line to someone wanting to purchase a piece of fine art.
What a difference three months makes. Back in March, there was a jubilant atmosphere when Beeple’s mega nonfungible token sold for $69.3 million. You didn’t have to look far to find bold proclamations that crypto art was the next bold frontier in culture — offering opportunities to fledgling creators and transforming the way we interact with masterpieces.
Things look a little different now we’re in June. All-time highs for Bitcoin and Ether are a distant memory, and sobering figures published by Protos suggest that NFT sales have plummeted by 90% since their peak in early May. (Some have questioned this data).
It’s a good time to reflect on how far we’ve come, and where we are going next. Endless column inches are now being devoted to the death of NFTs as an asset class — drawing eerie similarities to the hundreds of articles and tweets that have warned Bitcoin is heading to zero ever since its inception. (One of them came in September 2020, not long before the cryptocurrency’s dramatic bull run began).
Although the crypto markets are rather turbulent right now, those catastrophizing over NFTs might be rather short-sighted.
Just look at what Beeple — real name Mike Winkelmann — told CNN back in March: “NFTs as a technology are super exciting and a lot of people are comparing it to the early days of the internet. With the early days of the internet, you had a lot of hype and you had a lot of speculation, and then there was a bubble, and the bubble burst. But it didn’t wipe out the internet, people kept using the internet.”
Essentially, his point is this: NFTs that have real utility will continue to endure. And indeed, it’s worth noting that the Protos research stresses that crypto collectibles such as CryptoPunks have managed to remain resilient during this bearish downturn. (Indeed, Sotheby’s sold a rare CryptoPunk for $11.8 million just last week — what it described as a new world auction record).
Learning lessons
The NFT sector might have taken a beating in the short term, but this doesn’t detract from how these assets are unique, provably scarce and indivisible — transforming the notion of ownership entirely. There are use cases for nonfungible tokens that haven’t been dreamed up yet, and development and innovation in this industry is still at a nascent stage.
Explosive levels of growth in this industry have led to obstacles arising. At times, there has been very little oversight when it comes to the verification process. Congestion on the Ethereum blockchain, the birthplace of NFTs, has also stymied development.
One way of helping the NFT sector bounce back from its current malaise is to increase public awareness about the opportunities that these tokens bring — and make it far less expensive for creators to mint their very own tokens. Right now, digital artists who are just starting out risk overspending on minting NFTs because of Ethereum’s high transaction fees and gas costs — and they may fail to recoup these expenses if their art doesn’t sell.
Creating an environment where nonfungible tokens are easy to discover and inexpensive to buy and sell is nothing short of crucial.
The answers
One platform that is vying to make NFTs more accessible to all is MOVE Network — a developer-friendly blockchain that is energy efficient and well secured. Its end-to-end NFT aggregator brings digital assets together in one place. Gas fees are currently being waived for all users, and the ecosystem gives them a chance to easily tokenize their digital content with minimum expense.
This is coupled by a gamified experience that injects fun, intrigue and excitement back into the NFT space. Through the use of “blind boxes,” rare and valuable tokens are going to be hidden, waiting to be discovered. The project hopes that this will offer a new element of surprise for being a part of the MOVE Network community.
Some of the main focuses for MOVE Network include ensuring that these assets can be traded with ease and setting the foundation for NFT tickets — an innovation that could achieve a newfound level of sentimental value for fans who attend events, all while ensuring that tickets can only be resold under certain circumstances and eliminating the risk of counterfeits entering circulation.
The past 12 months have seen MOVE Network completing a beta test, enabling its platform to be used for demonstrative purposes. A collaboration has been established with the H Collective, a corporation that regularly works with top producers and talent in Hollywood. It’s hoped that this partnership will pave the way for NFTs to revolutionize the film industry. Meanwhile, the platform has also successfully closed a $1.5 million seed funding round to fuel its global expansion, and development of the blockchain technology that fuels its ecosystem.
Movie mogul Sid Ganis — who has worked as a top executive at studios including Sony Pictures, Lucasfilm and Warner Bros — has also joined MOVE’s advisory board. He said: “The film industry is constantly changing and innovating. I have been lucky to be a part of those changes for many years. Now movies and content are moving into the crypto marketplace via NFTs, which is another major shift into the 21st-century world of global entertainment. I am very happy to bring what I know to the process.”
MOVE’s NFT marketplace is scheduled to launch in the third quarter of 2021, complete with “blind boxes.” A MOVD token sale will also take place, with the cryptocurrency set to be listed on a major exchange thereafter. Later in the year, additional entertainment industry partners are set to be unveiled — with a decentralized NFT trading platform due to launch on Binance Smart Chain.
Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.
It’s fun to talk about nonfungible tokens, or NFTs, because they are the perfect example of how the impact of blockchain technology in people’s lives goes way beyond the financial market. As we could see in hundreds of headlines in the past few months, they have gripped the world’s attention because they are a new manner of interacting with culture, music, sports and the media.
This article will clarify what NFTs are, how they work, how the NFT boom started, and why blockchain technology has made it possible for NFTs to create a new economy.
Related:A cure for copyright ills? NFTs promise to empower creative economies
Why is there such excitement around NFTs?
NFTs are such an exciting and fun subject to talk about because almost everyone likes music, arts, games and the internet. The feeds of every social media platform are full of people who, having shown no prior interest in crypto assets or decentralized finance, eagerly talk about nonfungible tokens. In the first half of 2021, we saw a lot of celebrities and memes endorsing NFTs.
Jack Dorsey, Twitter’s CEO, sold his first tweet as an NFT for the incredible amount of over $2.9 million this past March. Edward Snowden’s NFT, a portrait of Snowden himself, was sold for about $5.4 million, or 2,224 Ether (ETH).
The NFT of the Zoë Roth meme, better known as “Disaster Girl” due to the 2005 (and beyond) meme of her malicious smile looking at the camera while a house is on fire in the background, was sold as an NFT for 180 ETH, equivalent to almost $500,000.
Related:When dollars meet the hype: The biggest NFT hits from celebrities
Furthermore, companies from the traditional market have decided to surf the NFT wave. For example, in Brazil, the first collection in NFT of Havaianas was auctioned off last month.
NFT transaction volume has multiplied by more than 25 since December 2020, as NFTs are in people’s daily routines and lives. It could be one of your favorite songs, a cartoon of your favorite superhero or a tool in a game that your children wish to acquire. In the following chart, we can clearly see the increase of NFT transactions in the last six months, as well as business volume since the end of the third quarter before the recent pop.
What are NFTs? How do they work?
We can conceptualize an NFT as a piece of software code that verifies the property of a nonfungible digital asset, or the digital representation of the physical nonfungible asset in a digital medium. For those who prefer a more technical view:
“An NFT is a pattern of smart contracts that provides a standardized way of verifying who owns an NFT, and a standardized way of ‘moving’ nonfungible digital assets.”
In this case, any nonfungible asset may be the object of an NFT, be it domain names, tickets for an event, digital coins in games, and even identifiers in social networks like Twitter or Facebook. All those nonfungible digital assets could be NFTs.
An NFT has a data structure (token) that links metadata files that may be fixed in an image or file. That token is carried and modified to accommodate the requirements of blockchain networks such as Ethereum, Kusama and Flow, among others. The art file is uploaded in a blockchain network that creates a metadata file in the data structure of the token.
As a content creator, such as the digital artist Beeple or the rock band Kings of Leon, you upload your art file to a platform that takes your file’s metadata and passes it through the whole back-end process of a product, otherwise known as your NFT.
Your NFT then gains a cryptographic hash (a key) — a tamper-proof register with the date and time stamp carried on the blockchain network. Following the valuable data and seeing that it had not been modified at a later date is essential for any artists out there.
Loading your art on-chain may give you a better perspective of when the metadata of the art file was tokenized. Since the data of the piece of art is uploaded, nobody can retrieve it or delete it, and the chance of your artwork disappearing is practically nonexistent if your NFT is registered on a blockchain.
How has blockchain technology amplified the possibilities of NFTs?
Up until 2008, traditional NFTs did not have a unified representation in the digital world. As a result, they were not standardized, and the NFT markets closed and were limited to the platforms that issued and created a determinate NFT.
The first NFTs in blockchains started with the advent of colored coins on Bitcoin’s blockchain. Although originally designed to enable Bitcoin (BTC) transactions, their script language stores small amounts of metadata on the blockchain, which can be used to represent asset management instructions.
On the other hand, the first NFT experiment based on the Ethereum blockchain was CryptoPunks built by Larva Labs, which consisted of 10,000 collectible, “unique” punks. The fact that the punks “live” on the Ethereum network made them interoperable with digital markets and wallets.
NFTs reached the mainstream on the Ethereum blockchain in 2017 with CryptoKitties, allowing users to create digital cats and reproduce them with varying pedigrees. This was a pioneer project for creating a sophisticated system of incentives, determining that NFTs could be used as a promotional tool. This led to the fostered interest of auction contracts, which lately have become one of the primary mechanisms for pricing and buying NFTs.
Related:Art reimagined: NFTs are changing the collectibles market
The exciting part about applying blockchain technology to NFTs is that it has considerably amplified their advantages and possibilities. It has brought forth the standardization of digital, nonfungible asset representation through the ERC-721 standard. Similar to the ERC-115 and the ERC-998 standards, ERC-721 is a pattern of smart contracts on the Ethereum blockchain that brings a standardized way of verifying who owns an NFT, and a standardized way of “moving” nonfungible digital assets.
It’s worth mentioning that although Ethereum is where most of the action currently happens, there are several NFT patterns emerging on other blockchains. For example, dGoods created by Mythical Games focuses on implementing a cross-chain standard using the EOS blockchain. Also, TRON’s first NFT standard, TRC-721, was officially announced in late December 2020. The introduction of this standard is expected to help the Chinese-centric blockchain utilize various distributed ledger technology-based apps and keep up with the pace of Ethereum’s growing NFT sector.
Since then, an NFT registered on a blockchain has truly become a “unique” asset that cannot be faked, tampered with or spoofed.
Related:Experts debate whether NFTs really need blockchain
What are the main benefits blockchains bring to NFTs?
As explained above, the first benefit of NFTs backed by blockchain technology is standardization. Besides the standardization of the primary attributes of NFTs — such as property, transfer and access control — blockchain technology allows NFTs to incorporate additional features, like specifications on how to acquire an NFT, for example. Other benefits include interoperability, marketability, liquidity, immutability, proven scarcity and programmability. We will explain each one by one.
The NFT patterns make interoperability feasible so that the NFTs can move more easily among several ecosystems. In a new project, nonfungible tokens may be visualized immediately in dozens of different wallet providers, negotiable in several markets and with the ability to be acquired in several virtual worlds. That interoperability is only possible because of the open patterns allowed by blockchain technology that provide a clear, consistent, reliable application programming interface, and with the authorization to read and record data.
Interoperability, in turn, has amplified the marketability of NFTs by enabling free trade in open markets. NFTs based on blockchains allow users to move their nonfungible assets outside of their original environments. They also have the advantage of sophisticated negotiation resources, such as auctions and bids, as well as the ability to transact in any currency, from cryptocurrencies like Bitcoin and Ether to stablecoins and specific digital currencies from a determined application.
The instant marketability of NFTs based on blockchains brings greater liquidity to markets that can serve a greater variety of public, enabling significant exposure of nonfungible assets to a broader group of buyers.
The fifth and sixth advantages of the use of blockchain technology in NFTs are immutability and proven scarcity. This is because the smart contracts allow developers to set severe limits on an NFT’s supply and impose long-lasting properties that cannot be modified after a token has been issued. Therefore, one can guarantee that the specific properties of an NFT will not change with time, as they are codified in the blockchain. This is especially interesting for the physical art market that depends on the proven scarcity of an original piece.
An interesting trajectory in this new NFT world based on blockchain appeared because of recent trends and new markets, such as programmable art — which allows collectors to interfere in the original design of the art piece.
In the market of NFT-represented art, immutability and scarcity are essential. In the digital art market, the advantage of programmability could be something to consider. We can find examples of programmability at Async Art, a platform to negotiate and create NFTs that enables the owners to change their images whenever they wish. Another example of the programmability feature is the ability for a song to change its composition. That means that the music may sound different each time you listen to it. These two examples are possible by dividing a piece into separate layers called stems. Each stem has several variants for its new owner to choose from. That way, a single track of Async Music could contain many exclusive combinations of sounds.
Takeaway
Many people have yet to understand the dimension of the NFT boom and how blockchain is revolutionizing the way we consume the arts. Perhaps the subject deserves a more thorough conversation.
However, the hole-in-one of NFTs is the programmability of smart contracts on the blockchain, which always guarantees a reward to the content creator whenever their work is negotiated.
Suppose a determined content (music, art, domain name, photograph of a goal from Pelé, etc.) is transacted hundreds of times. In that case, the content creator is going to receive a commission.
This could completely change the dynamics of copyright and intellectual property because if a “division of income” is programmed into the NTF’s smart contract’s code, the content creators will no longer need to worry about the legal property of their artwork.
Indeed, nonfungible tokens and blockchain technology markets still need to embark on a long journey to solve scalability, marketing infrastructure and the applicable jurisdiction in NFTs with decentralized storage. Nevertheless, we shall not lose sight of the possibility to codify the rights of the determined digital asset behind the transaction of an NFT. This enables the appearance of new businesses and new markets governed not only by institutions or traditional validators of trust but by those who create the content appreciated in the social and productive hubs.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Tatiana Revoredo is a founding member of the Oxford Blockchain Foundation and is a strategist in blockchain at Said Business School at the University of Oxford. Additionally, she is an expert in blockchain business applications at the Massachusetts Institute of Technology and is the chief strategy officer of The Global Strategy. Tatiana has been invited by the European Parliament to the Intercontinental Blockchain Conference and was invited by the Brazilian parliament to the public hearing on Bill 2303/2015. She is the author of two books: Blockchain: Tudo O Que Você Precisa Saber and Cryptocurrencies in the International Scenario: What Is the Position of Central Banks, Governments and Authorities About Cryptocurrencies?
Luxury auction house Sotheby’s made waves on social media on Thursday following the sale of one rare CryptoPunk.
In a tweet from Sotheby’s, the auction said CryptoPunk #7523 — also known as “COVID Alien” — sold in its London salesroom for roughly $11.8 million. According to the auction house, this sale represents a new world record for a single CryptoPunk artwork.
CryptoPunks, which predate the bulk of the nonfungible token (NFT) craze in 2021, are often small, pixelated depictions of people, apes, zombies and aliens. Sotheby’s announced the sale of the COVID Alien in late May as a “special, standalone” auction. The artwork features an alien wearing a face mask.
Moments ago in our #London saleroom, an extremely rare “Alien” CryptoPunk #7523 from the collection of @sillytuna sold for $11.8M as part of our #NativelyDigital NFT auction – setting a new world auction record for a single CryptoPunk. pic.twitter.com/PDVUSttI3o
— Sotheby’s (@Sothebys) June 10, 2021
On-chain data shows that someone purchased the CryptoPunk for 8 Ether (ETH) in a public sale in 2017 — a fraction of the sale price today. However, last month New York-based auction house Christie’s sold nine CryptoPunks for almost $17 million, implying there is still strong interest from many buyers for these pieces.
“Punks were designed as pseudonymous portraits, masks for those crypto pioneers that value the idea of privacy in the modern age,” said Sotheby’s in an overview of the auction. “Avatars, portraits or masks, they stand as semiotic reference points to a specific internet crypto native identity that now spreads itself across social networks — particularly Twitter. More is said by a Punk as a profile picture than a portrait of the individual behind the account.”
Related:Sotheby’s moves $10 million CryptoPunk to solo auction event
The NFT collector “Sillytuna,” who owned the COVID Alien prior to the sale, previously told Cointelegraph that he acquired the digital collectible in an over-the-counter deal. He took to Twitter immediately after the sale to announce that “NFTs are DEAD” and hinted he may have already used some of the funds to make another artwork purchase.
While the short-term market outlook for many NFT projects look uncertain and multiple new releases struggle to gain traction, one gardening-themed drop may have set some records by selling 8,888 NFTs in just under an hour.
Nonfungible token studio Zenft released a line of 8,888 unique bonzai NFT plants that quickly sold out last night, with the studio selling each digital tree for .08 ETH or roughly $220 at the time of publication. The bonsais have AR/VR functionality, and their 3-D design is a step up from previous pixelated, 2-D projects. The studio celebrated the nearly $2,000,000 sale with a tweet:
8888 Bonsai sold out in under an hour.
We are eternally humbled.
— ZΞNFT Garden Society (@zenft_) June 1, 2021
The success is somewhat of a surprise, given that NFTs remain mired in a slump following explosive growth earlier this year. New drops like Crypteriors struggle to sell out completely, making the one-hour mark a particular feat.
However, some collectors suspect that the success may be due in part to clever marketing.
“I like the way they look but it feels like people are trying to recreate what happened with the Bored Apes money printing machine,” said one prominent collector who spoke to Cointelegraph on the condition of anonymity. “Been feeling a little exhausted seeing the space devolve into celeb pump and dump.”
Bored Ape Yacht Club, another recent success amid the market dip, managed to attract a fervent community in part on the back of outreach to prominent investors and collectors in the NFT space — and, as one collector put it, where whales go smaller collectors, or “plankton,” follow (sometimes to their detriment).
lol bored apes made me my own custom one day one and reminded me of the sale
> forgot, didnt buy any
> prices have exploded 10x minimum from the sale price
pain. https://t.co/OZL6woZD2Y
— BIG DOG (@MoonOverlord) June 2, 2021
In an interview with Cointelegraph, “8ncient Gardener,” one of the three Zenft “gardeners” (or developers) said that marketing played a role — 8ncient “took painstaking care around crafting our giveaways” in particular — but ultimately the quality of the art is what made the bonsais such a hit.
“I think our art speaks for itself quite honestly. And everyone can unify around a bonsai. We had Apes, Punks, Voxo, Sandbox, Camels — all these NFT factions all rallying around bonsai,” he said. “In a world of pixel art we made gorgeous 3D bonsai.”
#NFT COLLECTIBLE GIVEAWAY
To celebrate life, I am giving away a sold-out Bonsai tree NFT by @zenft_ – It also grants a @TheSandboxGame bonsai NFT.
To enter:
– Follow @direkkt✅
– Like this post ✅
– Retweet ✅
One random winner will be announced Friday at 4pm UTC. pic.twitter.com/neWRIfp2dl
— Marcus Bläsche (@direkkt) June 2, 2021
The on-chain evidence is somewhat mixed. There are currently 1,736 different holders of the nearly 9,000 bonsais, with over 22% of the supply concentrated in two NFT whale addresses. From there there’s a steep drop-off, however, with a board range of addresses holding smaller quantities of the bonsais.
While it’s impossible to tell the exact source of the success, Zenft “Grove Councilor” “Justsomebonzai” argued that the digital trees are ultimately spreading joy:
“People genuinely like Bonsai, they’re beautiful IRL and they’re beautiful as an NFT.”
In an increasingly crowded marketplace for marketplaces, Binance is going on the offensive with a business development push aimed at bringing “100 Creators” to their forthcoming NFT platform.
In a press release today, Binance announced a drop from Misha Most, a noted street artist who currently holds the world record for the largest wall mural. Most will be making 10 NFTs made in collaboration with other artists, and the pieces will be available for sale in the first week of launch of the marketplace, currently scheduled for June 24th.
“Digital art is imbued with the spirit of the community, as a street artist, it’s very close to me, and I’m used to working in a team with other creators,” said Most in the press release. “Working on NFT is a unique opportunity for me to collaborate with digital artists. For me, the transformation of familiar works into digital art is primarily an experiment, and real art is about that.”
Most joins a host of other artists, celebrities, and athletes who have been courted by Binance, including soccer players Michael Owen and Alphonso Davis, singer-songwriter Lewis Capaldi, and artist Trevor Jones.
Stay tuned for my collab release on the new #NFT platform from @binance @BinanceRussian ⚡️⚡️ https://t.co/1KluGlfuIJ #binancenft pic.twitter.com/uk41Mjoufp
— Misha Most (@misha_most) May 26, 2021
The broad range of “creators” reflects a harsh competitive reality for NFT marketplaces: users rarely have any loyalty to a particular chain, platform, or product, and a growing number of companies (including e-commerce giant eBay) intend to be the ones selling shovels during the new digital gold rush.
As a result, the only way for a platform to stand out to collectors is with attractive intellectual property and licensing — and on this front Binance appears to be casting a wide net in the hopes that a broad range of voices will attract a similarly broad range of users.
“100 Creators Campaign is one of the campaigns that are prepared by Binance NFT and it is to support and promote innovative creators from around the world and spotlight NFT pieces from different cultures,” said Binance PR manager Lily Lee in an interview with Cointelegraph. “With this campaign, we hope to be able to access users from different regions.”
So far, Flow has managed to secure a dominant portion of market share on the back of a partnership with the National Basketball Association. While prices for their Top Shot collectible highlights have retreated as of late, their daily total volume still routinely ranks in the top 3 on Dappradar.
However, multiple other platforms have been throwing elbows as of late in an effort to secure a sliver of the market. ConsenSys-backed Palm is launching with a drop from renowned British artist Damient Hirst, and likewise WAX has been attempting to make inroads with baseball cards giant Topps.
Sustainable technology company OneOf has raised $63 million in seed funding to finance its new Green NFT platform for musicians, offering further evidence that the market for nonfungible tokens remains hot.
Several investors and venture capitalists participated in the seed round, including Bill Tai, Sun Said of Nima Capital, Sangha Capital, Tezos Foundation, Jack Herrick and Jaeson Ma of East West Ventures.
Built on the Tezos protocol, OneOf is a marketplace for artists and fans to tap into digital collectibles. The company claims that minting NFTs on Tezos uses over 2 million times less energy than leading networks like Ethereum. Artists wishing to mint an NFT on Tezos will pay zero cost for their listing, while users will be able to pay for their collections in over 135 fiat currencies.
OneOf also plans to donate a portion of its sales to an environmental cause or a charity of the artist’s choosing.
Artist Doja Cat said he’s “happy to be working with OneOf” in addressing accessibility and environmental issues at the same time.
“Blockchain has the ability to democratize ownership and bring economic empowerment to both artists and fans,” said Lin Dai, OneOf’s CEO and co-founder. “We are building a technology company with an artist-first ethos and eco-conscious mission to help introduce hundreds of millions of non-crypto native users to blockchain through easy and exciting use cases such as NFTs.”
Euphoria surrounding NFTs appears to have cooled over the past few weeks as the cryptocurrency markets tanked. Prior to the selloff, NFTs and DeFi were among the hottest trends in the cryptocurrency market.
Despite the recent pullback, the future for NFTs appears to be bright. A new industry forecast from the Invezz publication pegged NFTs at a market capitalization of $470 million by October as trading volume surges nearly 40%.
Art has been serving as the ultimate source of inspiration to many people throughout all of history. In the era of cryptocurrencies and the digitized world, trends change faster than ever. For years, numerous artists have tried stepping into rapidly advancing playgrounds and grabbing their slice of pie, but now their time has truly come.
The NFT fever has quickly taken over the industry, turning digital artists and popular meme creators into rich celebrities. It’s hard to estimate when this euphoria will run out of steam, but before the hype train stops, we’ll surely see more market records and thrilling experiments in this area.
Related:NFT trading cards: A new way to own collectibles or an asset bubble?
From a few pennies to a fortune
The market cap of nonfungible tokens, or NFTs, shows fast-moving developments, growing nearly tenfold between 2018 and 2020. The path from niche forums to the oldest auction houses was incredibly fast. Christie’s has recognized the trend in advance, launching one successful NFT sale after another. Different artworks and collectibles have born six-digit price tags — and more. The latest groundbreaking world record led to over $69 million being paid for a JPEG file by the artist Mike Winkelmann, also known as Beeple. Could this have been predicted a few decades ago?
The globally recognized auction house has plans to put nine rare CryptoPunks NTFs up for auction for an upcoming sale on May 11. “For the first time, 5,184 pixels’ worth of a revolutionary NFT project will go up for auction at a traditional auction house,” the auction house exclaimed. The estimated total sale price is between $7 million and $9 million, but it may well turn out to be much higher, since one of these tokens already sold for $7.5 million in March.
CryptoPunks is a prime example of the current boom in the NFT market. The project was initiated by Matt Hall and John Watkinson, founders of New York-based software company Larva Labs, when they created 10,000 images of people in 24×24 pixels. It’s hard to believe that the project’s founders distributed these NFTs to members of the crypto community just for free. Half a year later, the cost has surged to several thousand dollars, and today, these collectibles are already being sold for millions. What causes people to buy unconventional pixel digital art for the price of a garage full of luxury cars? The hype is caused by the role of cryptocurrencies rising globally and the fact that these limited editions still represent some of the first collectibles on the crypto market.
Tatiana Stiskina, an art historian and art adviser, explained the motives:
“I have decided to buy a CryptoPunk even before Christie’s announced their sale May 11. So my husband and I bought it on the day when Christie’s announced the sale. CryptoPunks is an even deeper symbol not only of cryptoart, but of the tech industry, as they are generated using an algorithm. It is the algorithms that are worshiped by the people who gave us everything related to Hi-tech and DeFi.”
Unraveling the story behind NFT’s popularity
What makes NFT items so desirable and special? Blockchain is the groundbreaking technology that changes almost everything it touches. The record of ownership can’t be faked, and NFTs can’t be copied and pasted. Empowered by distributed ledger technology, such tokens are nonreplicable and cannot be substituted, having only a single owner at a time. Due to their interchangeable features and fungibility, despite being called “nonfungible,” NFTs are liquid and can be purchased or sold on Ethereum-based markets.
Related:The chicken or the egg: Why NFTs could be fungible after all
CryptoPunks are some of the first NFTs, launched back in 2017 on the Ethereum blockchain. These tokens use the ERC-721 protocol standard, which means they are unique and cannot be replaced by another, hence their nonfungible nature.
Why are some tokens worth pennies while some increase in value to tens of thousands of dollars, and others yet are worth millions? The price is valued based on rarity analyses of specific attributes that the crypto art and community respect. However, although CryptoPunks have been pioneering the space, there are other examples that can eclipse their success. Like every additional, highly lucrative opportunity, this field has become overcrowded with the sharks that want to capitalize on the moment by defrauding consumers and collectors. When you keep in mind that the total value of NFT transactions quadrupled to $250 million last year, this trend doesn’t surprise anyone.
Related:NFTs and US taxes: What you should know
A glimpse into the future
There are no estimates on how long the anchor of NFTs will continue to appeal to wealthy investors. Some suggest that the bubble will burst faster than the initial coin offering fever ended. Right now, perhaps a fresh outlook combined with decent taste can make a difference and change things. A new ship must arrive at the NFT’s blockchain harbor that could promise such changes.
Last week, the crypto community went crazy about a new NFT collectible project — The Bored Ape Yacht Club, a collection of 10,000 Bored Ape NFTs living on the Ethereum blockchain — of unique digital collectibles, which sold out on the primary market. This is an exciting project that is trying to include gamification and community elements, and it will be interesting to see what comes next.
Ksoids project — which debuted on April 22 as an NFT project — skyrocketed to the first position in the charts on OpenSea just after a few days. Over 900 of the total 1,000 sold out, so some are still available to buy at auction. Ksoids are algorithmically unique creatures, whose breath of fresh air and creativity in its finest did not go unnoticed by digital art enthusiasts, collectors, fans and investors, declaring it to be a true indie project. Ksoids are the first generative art of 3D characters that not only create a world of their own but also help protect ours. 20% of each sale will be donated to the Orangutan Outreach, a nonprofit organization dedicated to protecting orangutans in their native habitat.
The latest NFT collection from Larva Labs was the talk of the crypto community in the last few days — the public sale being over within hours. The Meebits, 20,000 unique 3D voxel characters, are created by a custom generative algorithm registered on the Ethereum blockchain. According to data from Dune Analytics, Larva Labs made a staggering $72,976,613 from the public sale.
Related:What you should know before buying or selling an NFT in the US
Behind the boom for digital collectibles
In a highly speculative market, every new record becomes less impressive than the previous one. There will always be people willing to pay astonishing amounts of money for experimental ideas just for curiosity or to stand out of the crowd.
Some high-profile investors regard NFTs as a way to diversify their crypto portfolios and create new kinds of elite clubs, and most of the new market participants hope that digital art will cost a fortune sometime in the future. The only obvious thing is for the market to further mature and progress, and for professionals to step in and set benchmark quality examples.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Alexandra Luzan is a Ph.D. student researching the connection between new technologies and art at Ca’ Foscari University in Venice. For about a decade, Alexandra has been organizing tech conferences and other events in Europe dedicated to blockchain technology and artificial intelligence. She is equally interested in the relationship between blockchain tech and art.
