A New Era for NFT Art
First published in the Business Day, 26 March 2021
Worldart has become the first South African gallery to go to market with an NFT artwork. The piece which depicts a masked superhero styled woman entitled Timekeeper 151 was created by Cape Town artist Norman O’Flynn. It forms part of the Timekeeper series: portraits painted since 2015 in a vivid pop style where images and slogans have less to do with the subject in the portrait than with the world they live in.
O’Flynn’s NFT is a GIF conversion of the physical painting. The winning bidder will receive the painting itself as an extra reward and may keep it should the digital work get back onto the market later. Bidding started yesterday at $5000 (about R75k) on the sales platform OpenSea and closes on 16 April at 10pm.
Norman O’Flynn, Timekeeper 151
This is a new era for NFT art which got catapulted into the mainstream when Beeple’s work achieved $69.3 million at Christie’s. Sotheby’s wants a slice of the pie too and is looking at partnering with digital artist Pak.
Nonfungible.com tracks this market and recorded $250 million worth of sales for the year 2020. To put this in perspective, the size of the African art auction market was last estimated at $42.3 million. Non-Fungible-Tokens (NFTs) are part of the Ethereum Blockchain. They provide digital artists with a mechanism to package their art so they can trade it – they tokenise it – and digitally authenticate it. The information is stored online and protected with blockchain coding.
There are many advantages for artists. It removes intermediaries and gives them direct access to market, plus they can enable a feature that ensures they get up to a 10% cut when works are resold. Artists can also decide to drop an artwork as one-of-a-kind or an edition of many.
Whereas digital art can be copied easily, NFTs cannot be forged. This is carving a way forward for the market of digital art. It moves the focus to ownership as collectors can own an entry in the blockchain itself. Ownership becomes central to the medium, yet owners only get personal use rights and can mostly share their art on a social media page, digital marketplace, virtual museum or in a game world.
Recent price records are likely to raise alarm bells regarding conservation. What happens should the quality of the image deteriorate or the technology that conveys it become obsolete?
Buyers of NFTs get rewarded with bragging rights however. In the marketplace, which includes key players OpenSea, Rarible and Nifty Gateway, the name of an artwork’s current owner is equally displayed next to that of the artist. That said, both artists and collectors use pseudonyms, much like in the gaming world or the early days of the Internet, somehow perpetuating, maybe involuntarily, the art world’s proverbial opacity.
MetaKovan was revealed as the successful bidder of Beeple’s NFT at Christie’s. The Singapore-based pseudonymous crypto investor uses an avatar to stay anonymous. Speaking recently on social network Clubhouse, MetaKovan explained what motivates him. He’s made his fortune with cryptocurrency and spends most of his time in the crypto world. With his life moving online, he felt the need to enhance his virtual environment and started acquiring iconic and culturally significant NFTs in 2017.
‘If I have to deploy my capital in this world, I want to encourage people to share my philosophy”, MetaKovan says. ‘I don’t know if it’s the right valuation, but I’m happy Beeple has capital in his hands to deploy his world view’.
Current valuations may not be sustainable but a new generation of crypto millionaires is supporting the meteoric rise of NFTs. They are likely young, have accumulated wealth in the crypto world and are looking for ways to spend it in a way that will validate its future. It’s like a proof of concept; NFTs have to change hands to prove their value. What happened at Christie’s was an important moment. In MetaKovan’s words, it was a bridge between the real and the crypto worlds.
For now the NTF art market is largely underpinned by an element of speculation. Artwork information includes current owner and last price paid and it is possible to put an offer. The emphasis is on resalability and NFTs owners have already flipped pieces for tidy profits. Miami-based art collector Pablo Rodriguez-Fraile bought a 10-second video clip by Beeple for $66,666 and resold it four months later for a staggering $6.6 million. He is the co-founder of the Museum of Crypto Art, or MoCA, a virtual museum that currently houses over 250 NFTs.
In Africa, NFTs could afford digital artists very viable distribution opportunities. Lethabo Huma, a Pretoria-based 22-year-old digital painter, already sells her work via SuperRare. On the same marketplace, another African artist, the young Nigerian Osinachi, has sold NFTs for a little over $30 000 (R443 000). That’s certainly not a sum to scoff at.