In March 2021, the renowned auction house, Christie’s sold artwork by an American digital artist Mike Winkelmann, for $69 million. The art, known as Everydays: the First 5000 Days, is a composition of many arts that the artist (professionally known as Beeple) drew in his 5000 days challenge where he created an art a day for 5000 days. However, the buyer did not receive a physical picture in a frame, not even a digital copy. Instead, he become the owner of an NFT (non-fungible token) attached to the picture. This was the first NFT sale by Christie’s. Although no other NFT has sold for a higher price, many deals have been completed in the NFT market that has attracted the attention of the people in the art industry, and even in the world at large, for the better part of 2021. As the year 2021, which has been marked by heightened activities in the NFT market, comes to an end, it is clear that the NFT is reshaping the face of the entire art industry. Of all the players in the art industry, this relatively new niche has impacted the artists, creators, and producers of different forms of art. So, how are NFTs reshaping the world of art from the perspective of artists?
What are NFTs?
Let us first refresh our minds on the concept of NFTs before we look at their impact on the creative industry. NFTs stands for non-fungible tokens. From the word “non-fungible”, we understand that these tokens are unique and irreplaceable. Simply put, NFTs are unique digital assets that represent real-world assets such as art, in-game assets, music items, and videos. The tokens are unique hence enabling the identification of the represented assets as unique. The assets live in the decentralized and immutable blockchain network. They can be traded or transferred from one person to another to symbolize the transfer of the assets they represent.
What do NFTs Mean to Creators and the Creative Industry?
Ownership of Digital Art
Before the existence of NFTs, it was difficult claiming ownership of anything digital. People would pass through images, images, and motion graphics, repurposing and reposting them. It was hard, almost impossible to automatically assume complete and authentic ownership of any digital file or artwork. However, the introduction of NFTs is changing this narrative. NFTs, give creators and artists total control over their arts. They can display, rent, or sell them out as they wish. Art owners only need to tokenize them to enable easy management. The NFTs are minted (created) on the blockchain network, which records and keeps all transactions immutably.
Blockchain networks also allow tracking of copyright ownership. Artists can now officially claim ownership of their work. You do not have to be a big artist such as Gustav Klimt to gain official recognition of your art. Instead, any artist at any level in the market ranking can tokenize their items and enjoy similar copyright privileges as famous artists.
Lower Barrier to Entry
NFTs significantly lower the barrier to entry for artists. Nearly all niches in the art industry have many gatekeepers when operating in the conventional model. For example, third parties such as producers, managers, and even promoters may influence an artist’s success in the music industry. Sometimes such intermediaries may be expensive or even biased, resulting in suppression of the artist’s potential. With NFTs, artists can deal direct with the buyers hence greatly eliminating the intermediary dependence. When dealing with NFTs, artists can avoid the hustle and upfront investment needed to create and distribute physical collectibles, for instance.
A New Way to Generate Income
NFTs may seem like an improvement of the conventional counterpart. However, it offers a completely new way of categorizing digital artwork that allows artists to monetize their works. NFTs provide a quick and easy way for artists to produce and earn a reward for their creativity. It eliminates preparing files for printing, chasing clients around for payments, and waiting for days, weeks, or even months to hear the feedback from the clients.
Apart from directly selling the art, artists can also enjoy the royalties that come with some NFTs. The owners of such arts will earn a certain percentage of the art’s price anytime it sells in a secondary market. The royalty may be as high as 10% of all future sales.
A Global Reach
Initially, art collecting and selling of physical artworks had been happening in physical spaces. Creators made money by selling their artwork in real-life events such as auction houses, exhibitions, and physical art markets. The rise of NFTs, however, has moved art-collecting activities online. Many artists can now easily access the global market.
NFT platforms, just like social media, grant creators immediate access to global audiences. Having a pre-online following, for example in Twitter, can be an added advantage to artists dealing in NFTs, as it gives them exposure to the digital art market. However, artists must learn to convert their followers to buyers, and this may include investigating the brand strategy to find what works for them.
Inclusive Art Industry
The NFT art sector is creating an inclusive, protecting environment for all types of digital artists to make money. Unlike the analog art environment, you do not have to be one of the few famous artists to produce art that is recognizable in the market. You can create your NFT and sell it as long as you can access a computer. Your NFT also has a chance of becoming popular since the market is primarily influenced by the hype that drives the demand for NFTs. You will find space in the NFT market whether you are in the niche of 3D motion and graphics, realistic, or blocky pixels such as CryptoPunks.
However, you need to be aware of the minting fee. This fee can be high when using some platform, especially for beginners. You need to find a platform with low minting and other transaction costs, yet one that provides quality services and ease of use.
NFTs have the potential to transform the entire creative industry. The relatively new niche in the blockchain industry creates unique opportunities, especially for artists, creators, and producers. It gives them a golden opportunity to monetize their work and connect to the audience more directly in a way that even the biggest stars in the conventional art world could not enjoy. In a recent interview, Arnold Mhlamvu, the CEO and founder of Pocket Wallet DeFi suite, broke it down in these words, “NFTs are giving back the artists and creators what ideally belongs to them — sovereignty over their work. They can control who benefits from their time, effort, and creativity. It brings a real liberation to the art industry.”