NFTs, Blockchain, Cryptocurrency, Metaverse: The Web3 Revolution That Has Transformed the Art Market

A special issue of Arts (ISSN 2076-0752).

Deadline for manuscript submissions: 1 June 2024 | Viewed by 19872

Special Issue Editor

Centre de Recherches Internationales (CERI), Sciences Po Paris, 75006 Paris, France
Interests: contemporary art market; online art market; sociology of art; art economics; art and politics
Special Issues, Collections and Topics in MDPI journals

Special Issue Information

Dear Colleagues,

The sale of Beeple’s Non-Fungible Token (NFT) artwork Everydays—Everydays: The First 5000 Days for over $69.3 million at Christie’s online auction on 11 March 2021 ruptured the contemporary art market, representing the coming of a new era of exhibiting, selling, and collecting digital art. Indeed, in 2021, NFT became Collins Dictionary’s word of the year [1], and total sales in the crypto art market have reached $127.6 million [2].

The international scholarly open access journal Arts (ISSN 2076-0752) is now inviting submissions for the Special Issue “NFTs, Blockchain, Cryptocurrency, Metaverse: The Web3 Revolution that Has Transformed the Art Market”. We welcome original academic papers (6,000-8,000 words), based on either qualitative or quantitative research methods, that reveal how the web3 art market players, including artists, art galleries, art fairs, act auctions, art collectors, and art marketplaces, have endorsed the phenomena of NFTs, blockchain, cryptocurrency, and metaverse. Both theoretical and empirical contributions that address the contemporary digital art trends from a multidisciplinary perspective and examine their significance for the current state and future evolution of the art market will also be considered.

[1] https://www.collinsdictionary.com/woty, accessed on 21 March 2022.

[2] https://www.artprice.com/artprice-reports/the-contemporary-art-market-report-2021, accessed on 21 March 2022.

Dr. Elena Sidorova
Guest Editor

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 100 words) can be sent to the Editorial Office for announcement on this website.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a double-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Arts is an international peer-reviewed open access semimonthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 1400 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • contemporary art market
  • online art market
  • digital art
  • NFT
  • cryptocurrency
  • blockchain
  • metaverse
  • Web3

Published Papers (9 papers)

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Research

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15 pages, 277 KiB  
Article
The ‘Assetization’ of Art on an Institutional Level—Fractional Ownership Implemented in the Royal Museum of Fine Arts Antwerp
Arts 2024, 13(1), 16; https://doi.org/10.3390/arts13010016 - 11 Jan 2024
Viewed by 781
Abstract
This article explores the innovative collaboration between the Rubey platform and the Royal Museum of Fine Arts, Antwerp. Through the tokenization of the artwork Carnaval de Binche by James Ensor, this platform made it possible for interested investors to purchase blockchain-registered Art Security [...] Read more.
This article explores the innovative collaboration between the Rubey platform and the Royal Museum of Fine Arts, Antwerp. Through the tokenization of the artwork Carnaval de Binche by James Ensor, this platform made it possible for interested investors to purchase blockchain-registered Art Security Tokens within this artwork and become co-owners of it—at least from an economic perspective. Although fractional ownership platforms for art have been established before, this is the first time an art investment opportunity like this has materialized itself in an explicit partnership with a museum. The tokenized artwork will be held on public display within the Royal Museum of Fine Arts Antwerp, for a period of ten years—a significant departure from the usual practice of storing such pieces in a storage vault—before it will be sold again. This article contextualizes this practice within both the ‘assetization’ of art that has increased in recent decades and the financial challenges facing Belgian—more broadly speaking, European—public museums. Based on a limited number of interviews with the stakeholders and desk research, this article subsequently explores the more practical benefits and concerns of a collaboration like this and presents an analysis of this practice drawing upon publications within the field of economic sociology. Since we find ourselves only at the beginning of this partnership, some questions will be raised for further research. Full article
25 pages, 436 KiB  
Article
A Brave New World: Maneuvering the Post-Digital Art Market
Arts 2023, 12(6), 240; https://doi.org/10.3390/arts12060240 - 16 Nov 2023
Viewed by 1723
Abstract
The digital revolution has launched myriad new technologies in the field of art and cultural heritage law, including digital art, NFTs (non-fungible tokens), artificial intelligence (AI)-generated art, virtual reality and reality augmentation, online viewing rooms and auctions, holograms, immersive experiences, and more. As [...] Read more.
The digital revolution has launched myriad new technologies in the field of art and cultural heritage law, including digital art, NFTs (non-fungible tokens), artificial intelligence (AI)-generated art, virtual reality and reality augmentation, online viewing rooms and auctions, holograms, immersive experiences, and more. As a $67.8 billion industry, the art market is a global driver of innovation, international collaboration, and national economies, given its cross-border transactions. However, given the extremely rapid development of these new technologies, regulators have struggled to keep pace and implement legal measures that are fit for purpose in this field. Limited oversight has resulted in several claims that have the potential to change the legal landscape. For instance, claims over the theft/misappropriation of NFTs and the related fraud and money laundering that may ensue, as well as a recent class action copyright infringement suit against the creators of a popular AI algorithm and infringement claims over immersive installation and light technologies, demonstrate how new ways of thinking are required to assess cases involving digital property (distinguished from other types of non-tangible property). Moreover, the US Supreme Court has issued a landmark ruling on fair use within the copyright context, which will be relied upon in the future to determine whether (and to what extent) the appropriation of existing copyrighted material is permitted. This includes both the digital use of physical artworks and the use of born-digital works. Although jurisprudential decisions are made on a case-by-case basis, factual patterns involving online media, digital art, and related technologies could serve as guidance for legislators and other decision-makers when considering what limits should be imposed on Web 3.0. This article will focus on recent US-based claims and regulations and dovetail with existing art market regulations in this jurisdiction (e.g., anti-money-laundering statutes) to determine their impact on new technologies, whether directly or indirectly. Finally, the article highlights ongoing trends and preoccupations to provide an overview of the shifting legal landscape. Full article
19 pages, 5600 KiB  
Article
Tokenized and Tactile: Frank Stella’s Geometries (2022)
Arts 2023, 12(6), 222; https://doi.org/10.3390/arts12060222 - 26 Oct 2023
Viewed by 1340
Abstract
On 8 September 2022, the American artist Frank Stella launched a series of twenty-two digital art works minted as Non-Fungible Tokens (NFTs) in collaboration with Arsnl, the in-house platform by the Artist Rights Society (ARS). Titled Geometries, each “package,” included the NFT that [...] Read more.
On 8 September 2022, the American artist Frank Stella launched a series of twenty-two digital art works minted as Non-Fungible Tokens (NFTs) in collaboration with Arsnl, the in-house platform by the Artist Rights Society (ARS). Titled Geometries, each “package,” included the NFT that would affirm ownership and the corresponding geometric model designed by Stella in JPG (image), MP4 (video), SLS (3D printing), GLB (virtual reality and model manipulation), and USDZ (augmented reality). This range of digital formats alludes to two of Stella’s innovations in this space: the license to remix and manipulate his models, and the ability to 3D print Geometries at any color, scale, and material. Taking Stella’s foray into the NFT-space as a starting point, my article focuses on an emergent trend by artists engaging with Web3: the effort to bridge the physical and the digital by giving tangible form to NFT artworks and what this suggests for the future of digital materiality. The paper at its core seeks to examine the relationship between the physical referents to NFTs at the very moment when new media returns to historical forms. Full article
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23 pages, 4498 KiB  
Article
Comprehensive Analysis of the Trade of NFTs at Major Auction Houses: From Hype to Reality
Arts 2023, 12(5), 212; https://doi.org/10.3390/arts12050212 - 07 Oct 2023
Viewed by 1877
Abstract
On 11 March 2021, amidst the lingering grip of the COVID-19 pandemic, the art world witnessed an extraordinary event. Christie’s, the renowned auction house, hosted a groundbreaking auction counting just one lot: a Non-Fungible Token (NFT)—a digital asset that had been generating buzz [...] Read more.
On 11 March 2021, amidst the lingering grip of the COVID-19 pandemic, the art world witnessed an extraordinary event. Christie’s, the renowned auction house, hosted a groundbreaking auction counting just one lot: a Non-Fungible Token (NFT)—a digital asset that had been generating buzz in recent times. The astounding price fetched by the NFT sent shockwaves through the art world. While the 255-year-old auction house was known for selling unique assets, its auctioning of an NFT was surprising as Christie’s online marketplace was not on the blockchain, contrarily to NFT platforms such as Opensea, Nifty Gateway, etc. The resounding success, however, of its historic auction was followed by a surge of NFT off-chain sales at Christie’s, Sotheby’s, and Phillips. While extensive research has been done on the trade of NFTs on the blockchain, little research exists on the trade of NFTs at public auction houses. Based on more than two years’ tracking of NFTs auctioned at major auction houses, our research identifies three phases in the development of the trade and provides valuable insights into the unique factors that contributed to the growth of NFTs at public auctions between the springs of 2021 and 2023. Full article
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20 pages, 1395 KiB  
Article
Post-Merge Carbon Footprint Analysis and Sustainability in the NFT Art Market
Arts 2023, 12(5), 211; https://doi.org/10.3390/arts12050211 - 25 Sep 2023
Viewed by 1843
Abstract
The market for non-fungible token (NFT) art is expected to reach USD 44.2 billion in 2021 and increase by 67.57 percent in 2022, revolutionizing the relationship between artists, collectors, and investors. Despite this, concerns regarding the environmental impact of blockchain technology’s high energy [...] Read more.
The market for non-fungible token (NFT) art is expected to reach USD 44.2 billion in 2021 and increase by 67.57 percent in 2022, revolutionizing the relationship between artists, collectors, and investors. Despite this, concerns regarding the environmental impact of blockchain technology’s high energy consumption persist. NFT art transactions will continue to generate significant carbon emissions after Ethereum’s “Merge” to a Proof-of-Stake (PoS) system in September 2022, rendering many low-carbon solutions obsolete and necessitating further research into post-Merge alternatives. This study identifies solutions in the NFT art market, such as carbon neutrality, lazy minting, alternative consensus mechanisms, Layer 2 solutions and policy interventions. Carbon neutrality is achieved through investments in renewable energy or carbon credits to mitigate emissions generated by NFT art transactions. Lazy minting reduces energy consumption by postponing the creation of NFT art until a buyer is secured. In the NFT art ecosystem, alternative consensus mechanisms such as Proof of Authority (PoA) and Proof of Spacetime (PoST) reduce energy consumption. By offloading transactions from the primary blockchain, Layer 2 solutions enhance scalability and reduce energy consumption. Carbon taxes and energy consumption levies are examples of policy interventions that promote cleaner energy sources in the NFT art market. This study will explore the role of artists, collectors, galleries, and other significant players in encouraging environmentally sustainable practices in the NFT art market. In addition, it will investigate the effect of prominent NFT art sales on carbon emissions and the adoption of eco-friendly alternatives. By integrating and optimizing current carbon reduction strategies, the NFT art market can continue to flourish while reducing its environmental impact. The study emphasizes the significance of implementing a comprehensive strategy that incorporates multiple solutions that are tailored to the specific challenges of the NFT art market. Full article
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22 pages, 739 KiB  
Article
The Shape of International Art Purchasing—The Shape of Things to Come
Arts 2023, 12(5), 208; https://doi.org/10.3390/arts12050208 - 22 Sep 2023
Viewed by 1917
Abstract
This article is about the role of cryptocurrencies, for example, decentralized autonomous organisations (DAOs) and non-fungible tokens (NFTs), in the international art market. These are cryptocurrencies which can be used to work with local governments to deliver non-state-funded consultancy in, for example, funding [...] Read more.
This article is about the role of cryptocurrencies, for example, decentralized autonomous organisations (DAOs) and non-fungible tokens (NFTs), in the international art market. These are cryptocurrencies which can be used to work with local governments to deliver non-state-funded consultancy in, for example, funding bid writing or community risk assessment. Self-polycentric and cause-based DAOs typically focus on actively listening to their token owners, utilizing the group’s skills under a transparent incentive structure fostering trust. This article delivers a critical evaluation of DAOs as an organisational management structure and business operations vehicle. This evaluation considers DAOs’ utility in supplying goods and services, through the critical lens of facilitating the international art market. The objective of this article is to raise wider awareness and understanding of DAOs as a legal entity. This paper acts to introduce the uninitiated to the business, societal value and legal uncertainties of DAOs and NFTs. DAOs are internet-based organisations built upon a set of instructions presented in and controlled by a computer programme, i.e., a smart contract. Effectively, DAOs are an artificial, electronic, online, digital technology entity, with no physical form. Full article
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19 pages, 455 KiB  
Article
Non-Fungible Tokens and Select Art Law Considerations
Arts 2023, 12(5), 192; https://doi.org/10.3390/arts12050192 - 06 Sep 2023
Viewed by 1768
Abstract
Since 2021, non-fungible tokens (NFTs) have been a popular topic which has kindled the interest of art and technology enthusiasts and professionals. Some had very high expectations for the potential of NFTs, and in some cases, made an assessment for NFTs that go [...] Read more.
Since 2021, non-fungible tokens (NFTs) have been a popular topic which has kindled the interest of art and technology enthusiasts and professionals. Some had very high expectations for the potential of NFTs, and in some cases, made an assessment for NFTs that go beyond the existing limits of NFTs. There have also been others who approached NFTs suspiciously and in some cases, described them as a hoax. The purpose of this study is to examine the important effects of NFTs on the art world and art law, and to consider NFTs’ current and potential impacts. In this context, this article first provides an introduction to NFTs and why the author finds it interesting to think about legal issues surrounding NFTs. After providing definitions of non-fungible tokens and highlighting technical aspects of NFTs, the article then discusses select legal issues surrounding NFTs, such as the importance of legal terms and conditions of an NFT purchase, legal qualifications of NFTs, artwork ownership, artwork authenticity, artwork provenance and intermediary liability for NFT sales. One of the aims of this study is to put forward clearly what should be expected of non-fungible tokens and their potential. Another objective is to underline the fact that the unique dynamics of the art world necessitate having a unique perspective for legal matters relating to them, which is satisfied with art law and its professionals. Ultimately, this paper aims to contribute to having a more comprehensive understanding of non-fungible tokens and their impact on the art world and surrounding legal questions. Full article

Review

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7 pages, 229 KiB  
Review
When the NFT Hype Settles, What Is Left beyond Profile Pictures? A Critical Review on the Impact of Blockchain Technologies in the Art Market
Arts 2023, 12(5), 181; https://doi.org/10.3390/arts12050181 - 24 Aug 2023
Viewed by 1575
Abstract
In 2021, online marketplaces such as Nifty and Opensea gained popularity, and digital art creations, including Beeple’s pieces, made headlines worldwide. This attracted traditional fine art practitioners, artists, dealers, digital content creators, and crypto entrepreneurs who wanted to participate in this trend. Several [...] Read more.
In 2021, online marketplaces such as Nifty and Opensea gained popularity, and digital art creations, including Beeple’s pieces, made headlines worldwide. This attracted traditional fine art practitioners, artists, dealers, digital content creators, and crypto entrepreneurs who wanted to participate in this trend. Several significant investment and token-funded projects took place in Asia, fueling high hopes of revolutionizing the art market with nonfungible token (NFT) technology. However, the numbers suggest a different story, as NFT transactions have reached a historical low. Critics from both sides challenge the value of NFTs, and there is minimal empirical research on the topic of blockchain technologies in the art market. This paper explores the challenges and misunderstandings in the art market through the lens of the researcher’s insight as an art tech entrepreneur. Its aim is to provide an explorative account of the use cases of NFT and blockchain technology vis-a-vis the traditional art market. The paper discusses the current work in progress at the Art ID Standard consortium, covering decentralized identity, blockchain, and use cases, and provides insights into the implications of these challenges for artists, collectors, and the broader art ecosystem. Full article

Other

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17 pages, 360 KiB  
Commentary
Questioning the NFT “Revolution” within the Art Ecosystem
Arts 2023, 12(1), 25; https://doi.org/10.3390/arts12010025 - 30 Jan 2023
Cited by 5 | Viewed by 4522
Abstract
Three years after the sensational debut of non-fungible tokens (NFTs) on the art scene, it seems timely to reflect on their presumed revolutionary attributes. The speculative fascination at the beginning has gradually given way to mixed outcomes, with hardly predictable future directions. However, [...] Read more.
Three years after the sensational debut of non-fungible tokens (NFTs) on the art scene, it seems timely to reflect on their presumed revolutionary attributes. The speculative fascination at the beginning has gradually given way to mixed outcomes, with hardly predictable future directions. However, once recontextualized in the art ecosystem and its value chain, one may question the ability of NFT technology to lead to radical changes. Our main argument is that although they offer perspectives that are worth considering regarding contracts, authors’ rights management, and provenance, blockchain-based technologies do not substantially modify the typical characteristics of the art world. Based on recent press articles and academic publications, we comment on the effects of this technology on producers (artists’ creative process and career development), intermediaries (art market gatekeepers), and consumers (quest for authenticity, collecting habits, and museum intervention in the art market). Our main conclusions suggest that NFTs perpetuate oversupply and job precarity in cyberenvironments and reinforce existing purchasing behaviors driven by the quest for authenticity and conspicuous consumption. Our goal is to mitigate some statements found in the literature and the press, especially regarding the democratization of the art market, and to help art market stakeholders approach this technology most objectively. Full article
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