Decoding NFTs | Apollo magazine

From the December 2022 issue of Apollo. Preview and subscribe here.

When a digital artwork by graphic artist Beeple sold for $69.3 million at Christie’s in March 2021 – about the price you’d expect to pay for a top-quality Rothko – the world suddenly became aware of non-fungible tokens (NFTs). Soon every art journalist’s inbox was full of press releases about NFT ‘drops’, as releases of new works are called.

In September this year, even the former “bad boy” of British art, Damien Hirst, jumped on the bandwagon with an exhibition of his own NFT project, “The Currency”. Pace Gallery released its latest collection of NFTs on its platform, Pace Verso, in the same month, while Christie’s has launched an “on-chain” marketplace, Christie’s 3.0. They all take advantage of the fact that sales of art NFTs on the platforms that sell them – OpenSea, NFTX, Larva Labs, LooksRare, SuperRare, Rarible and Foundation – rose from almost nothing in January 2021 to $17 billion in January 2022, according to Bloomberg.

An NFT is a piece of computer code, created using similar software to cryptocurrencies such as bitcoin and ether. They all rely on blockchains – “distributed public ledgers” that allow ownership of an asset to be verified across a worldwide network of individual computers without central control. In most cases, the NFT is not the artwork itself. Instead, it ‘points’ to a digital file – anything from an artwork to a video, a recording or a design – that can be bought and sold using a cryptocurrency, usually Ether. Because each NFT is unique, unlike a bitcoin, it allows the buyer to claim ownership of the original digital work, no matter how easily the image file itself can be copied.

But just as NFTs seemed to be booming, the bubble has burst. Sales of art NFTs in September were $466 million, down 97 percent since January of this year. This mirrors the crash in the cryptocurrencies to which NFTs are linked. The value of bitcoin has fallen by more than 70 percent to below $20,000 from a peak value of over $69,000 in November 2021. The collapse of FTX puts the direction of cryptocurrencies even more in doubt. There are also signs of shaky auctions. At a recent NFT auction by Sotheby’s Hong Kong on November 1, five of 21 lots failed to sell, while 10 went for less than their low estimate.

So are NFTs the flash in the pan as many suspect, or could they have long-term cultural value?

“I am not unhappy that there has been a crypto and NFT crash and that the hype is over,” says Sabine Himmelsbach, director of the new media gallery HEK in Basel. “Since the beginning, everyone has only talked about the money and not about the quality of the work. In most cases, a JPEG, a GIF or a small video clip attached to an NFT is not very interesting.’ She says she is “much more interested in more conceptual approaches from artists who delve into blockchain’s inherent possibilities” and work that critiques what she calls the “bridge culture” that pervades the NFT world. HEK has just minted its first NFTs with veteran media, feminist and environmental artist Ursula Endlicher, who has been making digital art since the 1990s.

Jason Bailey—an artist and writer who came from the traditional art world but is also the founder of ClubNFT, designed to protect collectors’ digital artwork—is an evangelist for what he calls “the interaction between digital technology and art.” He believes the influx of “many new people coming in, not necessarily with a background or an understanding of art, but a lot of enthusiasm” is a reason to celebrate.

Bailey points out that a multitude of different types of people make NFTs, including trained artists who feel let down by the current art market. “It’s a global community of artists, many who don’t make money from the current art world system, who have come together and formed a whole new market that is, in many cases, fairer and more empowering for them,” he says. “There are a lot of people selling work for $10, $15, $20. It’s not going to make the cover ART news but cumulatively it is a revolution.’

Installation of Hito Steyerl’s live computer simulation SocialSim 2020, at the Center Pompidou, Paris, in 2021. Courtesy the artist, Andrew Kreps Gallery, New York and Esther Schipper, Berlin; © Center Pompidou / Bertrand Prévost

These conflicting views may explain why the art world finds NFTs so confusing. They are made by many groups of people in many genres, from high art to pop culture. Many of the most talked about NFTs are based on cartoons, sci-fi images, psychedelia or surrealism. In many ways they are not so different from street art – another popular visual language with its own communities, codes and references that was briefly co-opted by the mainstream art world in the market boom of the mid-2000s.

Many producers come from graphic design, animation, programming, computer game design and other parts of the technology world. Most promote their work on social media platforms such as Twitter, Telegram and Discord. Beeple, who like many NFT artists is self-taught, had nearly two million followers on Instagram before his record-breaking Christie’s sale. He had sold NFTs before for around $100,000 each on the NFT platform Nifty Gateway.

Noah Davis, who was the contemporary specialist at Christie’s behind the $69 million Beeple sale and is now brand manager at CryptoPunks, admitted that New York Times last year that ‘some [NFTs] look like they belong in a shop, on a dorm wall or on a notice board.’

Ironically, NFTs have their origins in the contemporary art world. In 2014, an artist and a technologist, Kevin McCoy and Anil Dash, created the first, with the goal of protecting digital artists’ rights. McCoy, with his wife Jennifer, are well-established new media artists with work in the Museum of Modern Art, New York, and the Museum of Fine Art, Houston. Last year, Dash told Atlantic Ocean that ‘the idea behind NFTs was, and is, profound. The technology should make it possible for artists to exercise control over their work, sell it more easily and protect to a greater extent against others appropriating it without permission.’ But the dream, he wrote, ‘has not yet come true’. As the article states, “the opportunism of the tech world has struck again”.

New media art, unlike NFTs, has a long history. It goes back at least as far as Robert Rauschenberg’s 1966 Experiments in Art and Technology, which paired artists with engineers from Bell Telephone Laboratories. Bruce Nauman, Nam June Paik and Manfred Mohr were other early new media pioneers.

For decades, new media art was considered difficult and conceptual. Interest centered on a handful of specialist institutions, such as ZKM in Karlsruhe and festivals such as Ars Electronica in Linz. There were a number of museum exhibitions around the first dot-com boom, including ‘BitStreams’ and ‘Data Dynamics’, both at the Whitney Museum of American Art in New York, and ‘010101: Art in Technological Times’ at the San Francisco Museum of Modern Species, in 2001.

It is only in the last five years that artists such as Hito Steyerl, whose work draws on computer games, military technology and surveillance cameras, have become prominent in the mainstream. Steyerl joins a handful of artists such as Jon Rafman, Ian Cheng and Camille Henrot, whose work uses and critiques modern technologies and has become a regular part of the International Biennale.

But now they are joined by artists whose work has grown out of NFTs. bitforms, one of the longest running new media galleries in New York, recently signed two stars of the NFT world, Refik Anadol and Tyler Hobbs. Anadol, a Turkish-American artist, uses artificial intelligence to turn large datasets into immersive sensory experiences. Hobbs, a Texas-based painter, creates custom algorithms to generate refined abstract works of digital art. Meanwhile, Sarah Friend, a Berlin-based artist who uses NFTs, Minecraft and the internet, comments on NFT culture: her series of Life forms NFTs are only kept “alive” if owners give them away within 90 days.

Alex Estorick, the editor-in-chief of Right click Savean online magazine designed to create a critical context around NFTs and new media art, says: “What we’ve seen this year is the merging of crypto and mainstream contemporary art. It’s one of the benefits of the crypto crash that the hype and argument that NFTs are really just a speculative vehicle has been tapped out.’

Despite the volatility of the crypto markets, NFTs are clearly here to stay. But the NFT art market seems to have rebounded
much of the traditional art world with its pop culture aesthetic, brash commercialism and its ability to circumvent the traditional system. The huge prices paid for little-known and sometimes derivative artists have raised uncomfortable questions about the way art is valued.

But mistrust goes both ways. Early NFT artist Robness spoke for many when he said that traditional art market players ‘are only here because they saw the dollar signs. They were not here to support us from the beginning. It’s something I keep reminding new people of in this [the NFT] place, he said Right click Save.

There are clearly millions of buyers for NFTs, and while most of the work is trivial, the same is true for physical artwork. Perhaps NFTs can be seen as the latest evolution of new media art, as the best practitioners of both fields begin to cross over. Instead of dismissing, perhaps the traditional gatekeepers who determine art’s cultural value should apply their critical skills and not just their marketing skills to digital art and NFT. The NFT market is huge and even if it only partially crosses over into the mainstream art world, the opportunities to educate a whole new audience in art have never been greater.

From the December 2022 issue of Apollo. Preview and subscribe here.