How NFTs are giving everyone the chance to be an art collector

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The clos­est most peo­ple get to own­ing a world-famous art­work is buy­ing a cheap poster from a gallery, but art deal­ers are deter­mined to har­ness tech­nol­o­gy to draw in new collectors.

Anai­da Schnei­der, a for­mer banker liv­ing in Switzer­land, is among those pro­mot­ing new own­er­ship schemes — for a small fee, investors can buy a dig­i­tal chunk of a paint­ing and share in the prof­its when she sells.

“Not every­one has $1 mil­lion to invest,” she said. “So I came up with the idea to split, to make like a mutu­al fund but on the blockchain.”

Each buy­er gets an NFT, the unique dig­i­tal tokens cre­at­ed and stored on the blockchain, the com­put­er code that under­pins cryptocurrencies.

Although cryp­to assets have been rout­ed this year with plung­ing val­ues, col­laps­ing projects and widen­ing scan­dals, the NFT art sec­tor has weath­ered the storm bet­ter than oth­er parts of the cryp­to world.

NFT art­works account­ed for about $2.8 bil­lion in sales last year and the rate has declined only slight­ly in the first half of this year, accord­ing to ana­lyst firm NonFungible.

Col­lec­tors and artists are among the most eager exper­i­menters with the tech­nol­o­gy, even if it means own­ing only a slice of a dig­i­tal copy of a painting.

A fifth of 300 col­lec­tors sur­veyed by the web­site Art+Tech Report said they had already engaged in so-called frac­tion­al ownership.

Schnei­der’s com­pa­ny in Liecht­en­stein, Artessere, offers squares of paint­ings by Sovi­et artists includ­ing Oleg Tselkov and Shi­mon Okshteyn for €100 or €200 ($100 or $200) a piece.

She is giv­ing her­self 10 years to resell them.

Schnei­der owns the paint­ings she sells, thus avoid­ing legal com­pli­ca­tions, but attempts to offer nov­el dig­i­tal own­er­ship schemes for pub­licly owned works are prov­ing more tricky.

‘Complex and unregulated’

Thir­teen Ital­ian muse­ums recent­ly signed deals with Cinel­lo, a firm that sells lim­it­ed-edi­tion dig­i­tal repro­duc­tions, to offer own­er­ship of dig­i­tal repli­cas of masterworks.

The buy­er gets a unique, high-res­o­lu­tion dig­i­tal copy to project on to a screen and a cer­tifi­cate from the muse­um, which gets half the proceeds.

A gallery assistant looks at a digital reproduction of the painting 'Madonna del Cardellino (Madonna of the Goldfinch)' by Raphael, displayed as part of the Eternalising Art History: From Da Vinci to Modigliani exhibition at the Unit London gallery in London. AFP

The com­pa­ny held a splashy Lon­don show in Feb­ru­ary dis­play­ing digi­tised works by Renais­sance mas­ters includ­ing Raphael, Leonar­do and Car­avag­gio. It has since sold a hand­ful of them.

But the Ital­ian Min­istry of Cul­ture was report­ed­ly irked that a repli­ca of Michelan­gelo’s Doni Ton­do sold for around €240,000 ($240,888) but Flo­rence’s Uffizi Gallery got less than a third of the proceeds.

A rep­re­sen­ta­tive for the min­istry was quot­ed in sev­er­al out­lets last month as say­ing the issue was “com­plex and unreg­u­lat­ed” and asked muse­ums not to sign any new con­tracts around NFTs.

Cinel­lo boss Francesco Losi was not pleased with the char­ac­ter­i­sa­tion, telling AFP: “We don’t sell NFTs.”

Buy­ers can ask for an NFT to go with their image, but the firm said they had their own patent­ed sys­tem to secure own­er­ship, which they call DAW.

Mixed blessing

Cinel­lo said it had digi­tised more than 200 works and its sales had gen­er­at­ed €296,000 ($297,000) in extra rev­enue for Ital­ian museums.

But the fir­m’s dif­fi­cul­ties in Italy under­line the mixed bless­ing of NFTs — they bring pub­lic­i­ty but also suspicion.

The NFT sec­tor — which cov­ers any­thing from avatars in com­put­er games to mil­lion-dol­lar car­toon apes — is replete with scams, coun­ter­feit works, thefts and wash trading.

Losi said he was well aware that NFTs could be used “in the wrong way” and was unsure what future they had in the art world.

Schnei­der stressed that her project was pro­tect­ed by law in Liecht­en­stein, the tiny prin­ci­pal­i­ty being among the first juris­dic­tions to pass a law reg­u­lat­ing blockchain com­pa­nies in 2019.

Beyond that, she said her insur­ance would cov­er dam­age to the art­works and she had also fac­tored in the pos­si­bil­i­ty that the paint­ings would fall in val­ue, though she declined to give exact details.

“I hope it nev­er hap­pens,” she said. “For me, it’s very impor­tant to put this idea in the market.”

Updat­ed: August 21, 2022, 5:44 AM



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