I recently gave a talk at the “ETH Meets New York” Blockchain Symposium with a catchy title of “The Platform View of the Blockchain” (video). I have been thinking about Blockchain a lot at Artsy, but I am not, by any means, a Blockchain expert (unlike the intimidating group of speakers that included Meltem Demirors and Joe Lubin). I’ve also never owned any coins. Finally, I work for a platform, which should, a priori, dislike the idea of decentralized anything. I am, however, very excited about the possibilities that this new technology brings to the Art World and so I would like to clear the confusion that is perpetrated by a perplexed press, as highlighted by a recent article in Art Market Monitor, in the short lighting talk below and in this post.
What is Bitcoin and Blockchain?
Bitcoin is a coin, aka “money”. Blockchain is a technology that enables moving coins around.
The best explanation on the Internet that I know of is Shai Rubin’s, CTO of Citi Innovation Lab. Unless you can explain to someone what Blockchain is beyond statements such as “it’s a distributed database” (it’s not), don’t skip this step and watch the video. Shai goes extra slow, no technology or math knowledge required whatsoever.
If that video got you interested and you’re curious about some computer science behind the Blockchain, this video by Anders Brownworth is next.
Who is Working with Blockchain in the Art World?
There’s a nice starter list of companies active in the art world and Blockchain compiled by Jess Houlgrave as part of her work for an M.A. at the Sotheby’s Institute of Art on The Arts Slack #blockchain channel (you can join here). I’ve selected a few and categorized them by the type of problem they attempt to solve.
How do I buy digital art?
Perhaps the most obvious and natural application of Blockchain in the art market is to produce, display, and sell (for Bitcoin) downloadable objects. This is the mission of Left.Gallery and Cointemporary.
How can I make money selling my work?
Distribution and content monetization, supporting multiple actors ranging from brokers to ad networks is the domain of Monegraph.
Where does this work come from?
Provenance can significantly increase (eg. a work was bought my a major collector) or undermine (eg. the work was stolen) the price of a work. A fairly well established player in this field is Ascribe and even Deloitte developed proofs of concept to solve traceability issues.
Is this work authentic?
Reducing risks around authenticity is the mission of Everledger, TagSmart and Verisart. These can work well in tandem with technology that uniquely identifies a work, such as Artmyn that can 3D-scan a work in-depth and Provenire that uses synthetic DNA polymers to specifically and uniquely mark artwork.
Who is using a copy of this digital work?
In an attempt to replace Digimark’s traditional watermarking standard, Blockai helps you claim copyright and protect your photographs by providing a digital certificate and tools built on the Blockchain.
How can an artist make money on the resale of a work?
Many artists watch their works resell for massive amounts of money without seeing a cent. Artlery is making Droit de Suite standard, attempting to redefine the art economy.
How much money do I owe in royalties to the artists?
This is a big enough problem for Spotify to acquire Mediachain, which originally had the ambition of uniting all artwork information without any central control.
Can we radically disrupt the entire art market with this technology?
It may be possible to completely disassemble and reassemble the art market and fix all the above problems by building a new technology platform where all the players are modeled from scratch. A Hyperledger/Fabric implementation of an auction business is available on Github.
What is art?
My favorite applications of the Blockchain question art itself. One of such examples is Furtherfield with a very interesting exhibition called New World Order, which displayed such works as the Plantoid, a Blockchain life form which hires an artist to produce a work of art once you send it enough Bitcoin.
Fear, Uncertainty and Data
Artsy was, and sometimes still is, viewed as a disruptive company because it has succeeded at aggregating information from 4000 galleries, 700 museums, 40 auction houses and over 60 art fairs and was built on this new thing called the “Internet”. And because Blockchain is fundamentally decentralized, many see it as a disruptive technology in the art market, including to companies like Artsy. We have a real data advantage and are thinking hard about building data products that our customers want, as signaled by our recent acquisition of Art Advisor.
So what will the Art Market and Artsy look like after the world economy has been transformed by Blockchain?
Discovering Art
Without doubt people will want to and continue to want to discover art online. This is fundamentally a centralized activity as demonstrated by the success of the Art Genome Project. There’s incredible appetite for intelligent recommendations at Internet scale, accurate metadata and both breadth and depth of information. That data can also be public, Blockchain or not, because everybody benefits.
Uniquely Identifying Objects
There’re thousands of Koons’ balloon dogs, small and large, exchanging hands between collectors, galleries and auction houses. Distinguishing one balloon dog from another is a difficult problem, and Blockchain can most definitely become the place where we establish origin and identity.
Establishing Provenance and Authenticity
I can easily scribble something similar to the works of one of my favorite street artists, Jim Joe, but nothing replaces the nights of scouting for his works all over East Village. Blockchain is a natural solution to demonstrating where a work comes from and, combined with such technology as in-depth scanning and fingerprinting, to prove authenticity.
Speeding Up and Lowering Transaction Costs
Credit card payments are making progress for lower priced works, but these are easily contested while returning a physical, unique object is virtually impossible. This is why most payments are wires - an archaic, tedious, expensive and cumbersome process. Blockchain-based currencies have the advantage of providing immediate ability to prove that you have the money and the transactions cannot be (easily) undone.
Proving Identity, Ownership and Capital
The art market wants to make sure collectors don’t flip works, and therefore care about who the work is being sold to. Proving identity or ownership on the Blockchain has the advantage of not requiring escrow or a trusted authority. Finally, you can demonstrate that you haver enough funds to enter an auction without having to send bank statements.
Making Market Data Available
We need more complete market data while maintaining privacy of buyers. Blockchain could give us visibility into the secondary market, which in turn will increase buying confidence and grow the market, potentially exponentially. Once data is made universally available the real competition for data science and AI can begin in the art world.
We Want Everyone to See, Learn About (and Buy) More Art
To summarize.
- Gatekeepers will become gateways.
- Owning data will become analyzing data.
- Control over user information will return to them.
- An opaque small market will grow exponentially.
The future is exciting! For more, check out my talk on the future of art.