Culture Writer Kitty Grant briefly explains the mysterious new trend in the art market, finally answering the question – what are NFTs?
NFTs, or non-fungible tokens, are the latest innovation in the art world, but for those unfamiliar with the current art market they can be confusing
What are NFTs?
NFTs emerged as a way for digital artists to sell their work more similarly to their physical art counterparts. NFTs are sort of like a digital trading card—the NFT is essentially a receipt of ownership of the artwork, rather than a file of the artwork itself, which is usually available to anyone. NFTs are part of the Ethereum blockchain, which means that the receipt of ownership works similarly to cryptocurrencies, and the whole history of any transactions is recorded. So owning an NFT is sort of like being the owner of a painting loaned to a public gallery that anyone can see, but only you own, right? Well it can be, but some NFTs have many copies, even thousands, so in those cases, it’s like you own the painting in the gallery, but so do lots of other people.
So why do people buy them?
Many people view NFTs as an investment; if you buy a work by an artist and their popularity increases, so will the value of the art, at least in theory. But NFTs are very new to the art world; in ten years, they could be the standard way of selling and buying new art, or they could be a forgotten relic of the cryptocurrency era, leaving purchases of over $60 million practically worthless. NFTs are, however, a new way for digital artists to sell their work, so fans can both support artists and own original works.
Then why do some people hate them?
A common criticism of NFTs is their environmental impact—NFTs and other cryptocurrencies rely on blockchain technology, which is maintained by energy consuming computers. The environmental impact of cryptocurrencies is so large that bitcoin—the largest of thousands of cryptocurrencies—produces more energy than The Netherlands. For many, NFTs have also exposed the problems in the current art market, where the prestige of owning an artwork is more important than appreciating the art itself.
NFTs are becoming an important part of the art market, and creating a space for digital artists opens the art world to more people across the world, but it’s impossible to know if they will last, and given their environmental impact, maybe they shouldn’t.
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