Before we go into the details of Crypto Collectibles, Bitcoin, Art and crypto Non-Fungible Tokens (NFTs), let us briefly talk about the background. Bitcoin and blockchain technology have inspired innovation and creative activity across many fields like finance, education, and Information Technology. It should not come as a surprise to find that Bitcoin and blockchain technology have inspired a noteworthy line of art, and a vibrant market for collectors. Like any art or collectible item, the essential ingredient is scarcity. There must be a confirmed limited supply of an item to support value.
In the traditional business world, the idea of reproducing something has a cost and a level of difficulty. In the digital world, the potential to replicate something is quite simple. The advent of the Bitcoin blockchain established a trust-less environment in which digital items can be provably scarce. Once created in the blockchain, the digital art can be fixed, unchangeable, and protected.
Bitcoin is an example of a fungible asset. The units of Bitcoin are interchangeable as each is identical to the other. A non-fungible digital asset has a unique identifier, a separate code that makes it unlike any other. Due to the power of blockchain technology, digital art, crypto collectibles, and other rare digital objects can be valuable because they are scarce and non-fungible.
About Crypto Collectibles: Bitcoin, Art and Crypto NFTs
Blockchain as Art Depository
In the traditional world, the world’s leading galleries keep art accessible, authentic, and safe. They employ the highest levels of technology and security to ensure that their precious artifacts are authentic and safe from unauthorized use. These world-class institutions serve important roles in security and distribution of fine art. In the digital world, some famous artists use blockchain to distribute their artwork.
Blockchain technology has impacted the distribution of art. Artists have joined groups, and startups have responded to the need for creating broader access to fine art. The blockchain may help resolve issues of custody and authenticity. The blockchain can create a verified record of creation, sale, and ownership of art.
• Valuation is among the advantages of art distribution by blockchain. Artists can assign values to their work using tokens. Members of a community can have a voice in valuation and not rely upon owner’s appraisals.
• Blockchain based registries can track proof of authenticity of art objects. The system can protect owner’s identity and provide reliable information for buyers.
The decentralized ledger can support the concept of trustless art sales. The art industry has grown through a dependence on central authorities such as the leading galleries and auction houses. These centralized institutions can wield tremendous power over price, profits, and distribution. Because of their central authority positions, they can keep large shares of the value of the art that they sell.
The blockchain offers an alternative in which artists can have direct sales capacity and remove the middlemen and central authorities form the distribution system. Some systems tokenize the art to ensure a scarce supply and support higher value. Other systems protect artists by ensuring intellectual property rights. Artists can sell using smart contracts which further protects their share of the value.
Tokenization is also a potentially important way to increase access to art. By tokenizing a masterwork, the artist can sell to investors that can each buy a piece of the ownership. Fractional owners can benefit from the proceeds of a sale after appreciation in proportion to their ownership. Smart contracts can protect artist and investors.
Physical Crypto Collectibles
Real-world Bitcoin collector items cover a wide range of materials, objects, and decorative uses. Bitcoin has no form, but the imaginations of artists and crafts persons are not limited to digital representations. Collectors can find an abundance of decorative, commemorative, and playful items. Many real-world collectibles have limited editions and have gained some value in trade and sale.
• CryptoStamps are a new way to provide postage and to create a digital collectable. Austria was first to introduce its ERC-721 tokenized postage stamp. The value of the stamps will rise according to a smart contract formula at a rate of about 8 percent.
• UN Crypto Stamps are a noteworthy addition to the Crypto collector’s market. Limited to 90,000 total stamps, buyers can purchase them through the issuing offices in Geneva, New York, and Vienna. The physical stamps are encoded into the Ethereum blockchain by smart contract.
• Physical Bitcoins are a favorite among collectors. Many have a brightly burnished gold plate finish to mimic the Bitcoin symbol. While some parts of the public may still regard Bitcoin as a gold coin, the rich appearance of Bitcoin gold or silver coin is extremely popular with collectors.
• Canvas, and Prints representations of Bitcoin and Blockchain technology are some widely-marketed crypto collectibles. Canvas paintings produced by artists dedicated to Bitcoin are joined by traditional artists that have adopted Bitcoin themes.
• Wall Art images of Bitcoin or Bitcoin related designs are a popular way of expressing awareness of Bitcoin. These items cover a wide range from poster art to common or unique objects decorated with Bitcoin symbols. For some, it may simply be a trendy wall decoration, and for others it may express a deep felt dedication to open financial access.
NFTs are digital objects that are unique and distinguishable from similar types of items. The recent highest selling NFT or crypto NFTs, include the below described Bitcoin and Bitcoin code art sold at auction.
• September 2020- “ Right Place & Right Time” digital art by Matt Kane; this art describes the volatility of Bitcoin -sold for $101,953
• October 2020- “Block 21” by Robert Alice Project – an interpretive piece based on Blockchain Tech sold for $131,250. Block 21 is a name that reflects blockchain technology and the 21 million unit limit on Bitcoin production. The art consists of the exact numbers of code used to create Bitcoin.
More on Non-Fungible Tokens (NFTs)
On a worldwide market basis, NFTs have sold for more than $130 million. Among the most interesting NFTs are the hero schemes designed around the classic comic icon Batman. Comic based art has a loyal and growing following worldwide, it is not unexpected that a similar level of interest exists in the cryptocurrency space.
The creative dimensions in NFT art extend into aspects not available in traditional art forms. The record-setting “Right Place & Right Time” digital art by Matt Kane changes each day with the volatility of Bitcoin pricing.
The technical side of NFTs also involves innovation. The original format for NFTs was the ERC # 20 standard. Some creators of popular NFTs proposed a new standard for NFT called ERC-721. The ERC 721 standards advanced the engineering for NFTs and added depth. While ERC 721 emerges as the widely used standard, developers have made further advances. ERC -821 has added sophistication to the improvements and many newer projects use the ERC-821 standard.
In early October, Christie’s auction house listed a nonfungible token for sale. The occasion marked the first sale of an NFT at a major art house that specialized in traditional art. The painting was a digital portrait of the original Bitcoin code. While the estimated price was listed in the range of $12,000 to $18,000, the art sold for more than $130,000.
The impact of the blockchain in the field of art is profound. Traditional art gained value because of unique artistic qualities and scarcity. There were only so many Van Gogh’s or Picasso’s. And the idea of owning a masterpiece meant to own a singular thing. Digital art takes many forms and some of the pioneers resembled memes from other media forms. Cartoon stylings and cute animal images were the early leaders in marketing cryptocurrency related art.
Finally, Bitcoin is and will likely continue to a prominent source of inspiration for real-world and digital art. Blockchain technology can be a central force in the future of art, art distribution, and Bitcoin collectables (Crypto Collectibles). Tokenization opens vast new channels for art creation, sale, and artistic control. The blockchain can decentralize many functions now performed by central authorities.