[DIVERSITY VOL. 2] NFT ART in this era

2022.3.4

Even if a person purchases the value of a digital image file with tens of billions of KRW, the person cannot own the actual artwork. What is NFT ART, then? 4 officials in the industry predict the cataclysmic change in the art market driven by NFT (Non-Fungible Token).

 

NFT, Refresh – Writing. GaJin Lee, a journalist in arts
There are two impressive articles among the recent NFT news. The first article is about an NFT of a ‘clipart’ rock that was sold for $1.3 million (more than 1.5 billion KRW). The rock was one of EtherRocks, also known as ‘pet stones,’ that exist only on the Internet as images. There are only 100 EtherRocks produced to guarantee rarity and scarcity. The EtherRock website proudly states, “These fictitious rocks serve no purpose beyond buying and selling and give buyers a strong sense of pride to own one of the only 100 rocks in the game. “The second article is about an Austrian artist Erwin Wurm joining the NFT boom. He is the one who has broadened the horizon of the concept of sculpture with the ‘one minute Sculpture’ series and released his first NFT edition with the title of ‘BREATH IN, BREATH OUT’. This is a short video using the existing shape of another representative artwork, ‘Fat Car’, repeatedly showing the scene where the body inflates and returns to its original state as if a red Porsche were breathing.

Whether it is a painting of a stone or a video of a car, anyone can be accessible. But someone pays a huge amount of money to own the ‘irreplaceable’ value assigned to that file. NFT based on blockchain technology returns the ownership of creations to the creator and emphasizes its good impact that the profits should be distributed to the original creators. This will raise awareness of copyright and ownership of artworks and expectations for opportunities to be provided to more artists. However, the original intentions and hopes become insignificant in the face of reality that the value of endless zeroes are added to an image file without any purpose or meaning that no one knows who drew it, or star artists collaborate with large galleries to mass produce ‘editions’ in the new way of NFT.

In April of last year, I compared NFTs to “hot potatoes” in a column. Do you think the temperature of hot potatoes has changed after half a year? I can still hear a number of related news and it seems that the differences of opinion about NFT are not settled down even if we have had more experiences in NFT. The advocates urge that ‘NFT is the future’ and the critics say, ‘It is a huge scam’. Perhaps, because of these clear differences in their positions, the NFT seems to be socially positioned somewhere between the term of current social issues and real-time hot issues. Even now, in the midst of the gold rush for NFTs, most people are not very interested in this market. Where does all the new content appear from whenever I press ‘refresh’ button? The speed of this unrealistic spread seems rather irreplaceable.

 

NFT Art indicating the digital change – Writing. Tae-eun Kim, operator of Triumph X’s NFT Marketplace, Sole-X and ENFTEE
According to a report by UBS, the sponsor of Art Basel, 56% of the 2,569 high net worth collectors in 10 countries including the United States, United Kingdom and China were counted as Generation MZ. Due to COVID-19 pandemic, the volume of investment in artworks by Generation MZ, who are familiar with digital technology, has surged through OVR (Online Viewing Room) and other online platforms. The investing tendency of Generation MZ led the NFT Art market based on blockchain, a new technology, and it created the explosion in both supply and demand. OpenSea.io, the largest NFT exchange, broke the trading volume record everyday, and artworks with the value of $302.636M (about 236.9 billion KRW) were traded in one day on August 29th. This was close to 10 times the average daily trading volume when the total trading volume of artworks in 2020 ($50.1B) is divided by 365 days. The number of users who bought artworks on that day exceeded 40,000. As a large number of designers from the industrial design as well as fine art creators flowed into NFT Art, the supplier base of the art trading market, which focused on blue chip art, has been expanded to the public. The buyers’ market has also expanded to the public since anyone all over the world can buy NFT artworks in the digital environment. However, we cannot conclude that this phenomenon is simply focused on product values. In my opinion, I would say the flow of the changing art trade market due to NFT Art reflects the times and a flow of art trends. Generation MZ in the NFT Art market uses cryptocurrency to buy hot dogs, travel, trade expensive digital game items, and chats with friends in the metaverse space. They value individual differences in taste than the group’s preference and feel proud of their ‘secondary accounts’ decorated in the digital space. They feel little gap between virtual space and real world and are not really interested in the value of labor capital and the existence of cryptocurrency. If it is convenient, fast, fun, interesting, and worth the investment, Generation MZ just jumps into it. They follow their instincts but are being realistic rather than sentimental.

NFT Art indicates a perfect digital transformation in the art industry and introduces a path to the utopia for Generation MZ who wants to cultivate their own artistic senses. Anyone can become an artist or a collector and receive an equal opportunity to be evaluated for artistry and aesthetics of own work. More people will have artistic experiences through the digital medium called NFT. However, I am concerned that the market might be ruined due to the massive inflows of capital as blockchain, metaverse, and NFT become one of the investment trends. I hope that the fandom of art lovers continues to lead the new NFT Art market in the future. To do so, it is time to urgently prepare basic guidelines for the older generations who love art rather than leaving this market behind as a space that only Generation MZ enjoys. If the mainstream of the traditional market, such as critics, curators, and dealers, does not ignore this market and consider the ways of expanding their roles together, then the art industry will develop even more through a new transformation, and the sufferings in the market during the transition period will be minimized.

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