One article to understand the art of encryption and NFT

This article is an overview of the recently up-and-coming field of “crypto art” and also covers the use of “non-fungible tokens (NFTs)” as a mechanism for issuing digital art.

Limited Edition Tokens

NFTs, or tokens as I will call them, can be understood as unique digital objects that can be collected by a user and transferred to another user in a cryptocurrency network. In the field of crypto art, they usually represent a media file, a piece of software, or some artistic concept. These NFTs can be issued in limited quantities and are cryptographically signed and traceable directly to the artist’s provenance.

These NFTs are very similar to signed inkjet prints made by digital media. Let’s say an artist is selling a series of limited-edition digital art prints that he created himself. The artist sets a limited-edition release number (1, 5, 50, etc.), promises not to release more than that number, and signs each piece to say “this item is special.” If his work is highly rated, others will rush to buy it and own it, maybe the piece will end up being bought and managed by a private collector or a public institution.

One article to understand the art of encryption and NFT

Shaded Structures, yazid, Hic et Nunc (https://hicetnunc.art/yazid)

However, sought-after and proven works are not just prints of media or images, but limited-release, signed artwork by the artist. As a concrete example, a photograph signed by Ansel Adams can sell for hundreds of thousands at auction, while those without a signature, even the same photograph, will only sell for hundreds of thousands at auction. Can be sold for a fraction of the auction price. Jack Rusher details this situation in his article on crypto art.

Scarcity and abundance

An interesting, and often ridiculed, point about crypto art is that collector-purchased works of art are common on the Internet, and full-resolution images are often free to view and download.

One article to understand the art of encryption and NFT

Art Blocks by Monica Rizzolli

《Fragments of an Infinite Field》:https://artblocks.io/project/159

You might notice that the economic value of art has been tied to the scarcity of its medium since time immemorial. Yet crypto art represents a paradigm shift that separates signatures (tokens signed by an artist) and artistic mediums (images, photos, animations, concepts). This allows the former to retain its scarcity and unique transferability, while making the latter resource-rich and accessible.

One article to understand the art of encryption and NFT

Signature art medium in the form of limited edition tokens

While this is a polarizing paradigm, it’s not new, and similar ideas exist in the distribution and purchase of conceptual art, such as Sol LeWitt’s murals. In these cases, what is “owned” and transferred (eg acquired by a collector, museum, institution) may simply be a signed certificate of authenticity. The same goes for crypto art: the tokens being issued and traded are not documents, but more akin to a proof of authenticity signed by an artist, each with some conceptual connection to a particular medium, artwork, or idea.

One article to understand the art of encryption and NFT

Mural by Sol LeWitt #793B (1996)

A common claim is that tokens impose “artificial scarcity” – one might say limited edition signed prints are equally artificial and arbitrary scarcity, especially when the works are produced by inkjet printers and certified with pencil signatures when. Prints can be forged or copied, and sometimes the copy is barely distinguishable from the original (like the MSCHF’s recent “possibly an original Andy Warhol painting of the Fairy” prank) . Conversely, duplicating a token contract, even by the artist himself, yields a completely different new identifier and hash (a string of numbers and bytes), which is also clearly identifiable on the blockchain Provenance and History. Of course, this doesn’t mean that crypto art is completely immune to counterfeiting – piracy is plentiful, and it still requires careful research and investigation. Plagiarized or poorly designed interfaces, tokens that look alike, and believable imitations of artists can all lead to regrettable purchases.

alternative plan

These thoughts may make you question : Does art really need the element of scarcity, signature authority, and ownership? The answer is no: Many artists will give away unsigned open copyright works, build public facilities that cannot be owned, and publish their work for free on the web for all to see. But lacking broad support from nonprofit arts organizations, public institutions, and government grants, if artists want to sustain their artistic practice as a cause, most of them have to find alternative distribution mechanisms and monetization models.

Some of these alternatives include platforms like Patreon, Etsy, Gumroad, Kickstarter, Shopify, and more, which together help artists maintain their practice. But there is no magic bullet, and for many artists, the income from platforms like Patreon is barely enough to pay rent, let alone pay down debt, care for households and other living expenses. What’s more, most platforms cannot recommend physical mediums for digital artists that match their skills and preferences. Does it really make sense for a 3D animator to open a print shop to sell physical work and still images?

Maybe we can “pay the artist” which means “donate to them and expect nothing in return”. It’s a lofty ideal, but so far unfulfilled, and most people who tout it don’t actually donate to artists on a regular basis (ironically, they may buy signed works from artists, or commission artists exchanging goods in the hope of getting something in return).

This is not to say that we should forgo public funding, if system-level change were to take place, if governments around the world generally paid their artist-citizens an annual salary, we might no longer need these digitized privately funded art and creative markets. Aside from changes in government, another possible way to support artists more generally is through nonprofit arts organizations — a common goal in the crypto art space as well. Art Blocks artists and collectors helped channel approximately $45 million to various nonprofits in the platform’s first year, many of them art-related (including Rhizome’s largest single sale in its 25-year history) donation).

Ownership & Property

People often confuse the concepts of copyright and intellectual property ownership. As with the purchase of signed prints, no transfer of copyright or proof of license occurs during the purchase of signature tokens. Copyright and proof of license remain the property of the artist or content distribution licensor unless otherwise specified. Different tokens may have different licenses, some are valid as CC0 in the public domain, some are free for non-commercial use, and some try to license copyright and token holders (no court-verified proof of license) associated.

It goes without saying that purchasing a token does not make you the “owner” of the specific media file that the token represents or points to. As mentioned above, this media file has multiple access methods on the network, and anyone can right-click to save the file. In fact, most tokens that point to media files will use a technology called “IPFS” to save and distribute the files to as many computers as possible, alleviating the reliance on a central point of failure.

One article to understand the art of encryption and NFT

Generative artwork “Bougainvillea” by gpitombo on fxhash: https://fxhash.xyz/gentk/slug/bougainvillea-29

We might be able to make a claim around “ownership of the artwork,” though. This claim can only be made if we acknowledge that conceptual art can be owned (as in LeWitt’s work), and that tokens can conceptually represent some level of artistic meaning, not just document indicators and digital collectibles. is correct. It’s a controversial topic: some readers, artists, and collectors will reject the idea that conceptual art can or should be owned. The most popular crypto art market is filled with fancy apes, bears, penguins, and pretty much every other animal figure that usually doesn’t belong to any real artist and doesn’t help the ownership of the artwork.

At the very least, it is generally agreed that the collector does own the token itself, which some might see as the only record in a distributed database, similar to the sole owner of a domain name, who has the right to transfer and sell that digital property (note: a certain Some NFTs are domain names themselves, used exclusively inside blockchain protocols).

A new distribution mechanism

A new mechanism emerged: Artists could distribute digital art, and viewers could buy and collect it. In particular, when I say digital art, I usually refer to digital media such as “animation, generative art, photography, illustration, graphic design”, etc. I think digital tokens are not suitable for the certification, issuance and transfer of physical artworks such as oil paintings and sculptures .

One article to understand the art of encryption and NFT

Pixel art GIF by giomariani on Hic et Nunc 

Works: https://hicetnunc.art/giomariani

In fact, the crypto art mechanism is fundamentally different from other online distribution platforms, each with its own advantages and disadvantages. Hic et Nunc is a distribution platform built on the Tezos ecosystem where artists pay a small fee (like 0.06 XTZ, about $0.24 at the time of writing) to “mint” their work in a fixed distribution to on the public ledger. Artists sign transactions with the private keys of their cryptocurrency wallets, they receive payment tokens directly, and the platform takes a 1% service fee from each sale.

Artists can set token royalties, typically between 5-25%, and they can be paid continuously every time a token is traded (and possibly appreciated) on the platform’s secondary market. In other marketplace platforms, royalties can be distributed to multiple beneficiaries (such as a percentage directly to a nonprofit or an open source software tool).

It is worth pointing out that the transaction amount of many primary markets on the Tezos chain is in the range of 1-50 XTZ, which is actually similar to the price of the artist’s limited physical works. Yet mainstream coverage tends to focus only on high-priced and eye-catching deals, which can distort perceptions of the market.

The rate standard on the Tezos chain is very different from the standard of the traditional art creation market. In the traditional art market, galleries often take 40%-60% of each sale, while artists receive no royalties on the secondary market. This also far exceeds what distribution channels like Bandcamp charge (14-21%), leading some artists to try Hic et Nunc as an alternative music distribution platform.

One article to understand the art of encryption and NFT

An experimental music distribution platform (hen.radio) built on Hic et Nunc

In some cases, artists in the field can circumvent these platforms and services, customize a smart contract and sell directly peer-to-peer to interested collectors such as Rhea Myers, Mitchell F. Chan, Sarah Friend, Deafbeef, Andrew Benson Wait, they started exploring blockchain art many years ago.

Borderless

A distinguishing feature of crypto art is that it is borderless in a way, and individuals participating in a cryptocurrency network are still bound by national laws and regulations (such as paying taxes on crypto art income).

Distributed and global platforms like Hic et Nunc enable crypto art to flourish globally, artists and collectors can use the same shared currency to exchange art and value, and the transaction is recorded without any particular jurisdiction. on the public account under the jurisdiction. This is crucial: instead of pricing their art in local currencies and markets, artists price their work in a globally shared marketplace. While it’s hard to measure artists by country and varies by platform, some informal polls on Hic et Nunc can give us some insight.

Unfortunately, this does not mean global fairness: sales tend to be concentrated on artists from the West (usually white males), which can be driven by factors including hardware, education, language barriers, technical barriers, social media popularity, discrimination, etc. For a number of reasons, the sales promotion bit at the center of the web interface exacerbates this inequity. Galleries, curators, hashtags, and other outlets have sprung up trying to address some of these issues and open up interfaces (pop twig, alterHEN, JPG), with varying degrees of success.

Platforms like Feral File take a different approach to fully open markets: assigning a curator to each exhibition, focusing on highlighting the diversity of artists and artworks, rather than amplifying the outbursts of potentially biased populations. whimsical.

One article to understand the art of encryption and NFT

Exhibition “GRAPH” curated by Processing co-founder Casey Reas: https://feralfile.com/

Decentralized & Permissionless

Notably, most crypto art is built on two other unique properties of blockchains: decentralization and permissionless. That is, no single participant can control the public ledger, and users can record transactions as long as they pay a fee. This is a double-edged sword.

On the one hand, this could help remove reliance on centralized services and intermediaries (PayPal, Instagram, auction houses), while giving users more ownership over the assets they issue and collect. This was borne out by Hic et Nunc, whose ecosystem, assets and many forked sites were largely unaffected when the platform shut down as its owners and developers angrily quit. This is possible because the distribution medium and blockchain record are not controlled by the owner from the start; instead, the responsibility for ownership and maintenance falls to the user community (more on this here).

One article to understand the art of encryption and NFT

The hicetnunc.xyz website was shut down by its owner,

But it was then forked as hicetnunc.art and continued to function normally.

The benefits of decentralization can also be seen in different competing marketplaces on the same chain, such as Objkt.com, Versum.xyz, Fxhash.xyz and other marketplaces on the Tezos chain, all running on the same public ledger, Many of these platforms have the same token index. This allows users to buy tokens in one market and sell it in another, and even trade those tokens from one user to another peer-to-peer without relying on any particular website.

On the other hand, however, a zero-moderation system can lead to many problems: rampant spam, illegal content, “plagiarism” (plagiarism), phishing, impersonation, and more. Open marketplaces like Hic et Nunc and Opensea are often forced to de-index and remove content that violates the code of conduct. It’s like Google removing your site from search results – your site is still there and running, but is no longer easily discoverable. Moderation and indexing on these platforms is a huge challenge, essentially a game of whack-a-mole, leading many users to prefer curated or well-known collections of collections.

Not all chains are created equal

So far, I’ve mainly mentioned the Tezos blockchain in the article, as it has a thriving art community as well as a range of different marketplace platforms. The chain is energy-efficient (similar to the power consumption of common network activities like tweeting and blogging) and the transaction fees are extremely low (tenths of dollars, sometimes only tenths of cents), which has also become a discussion about the potential future of crypto art. core of the discussion.

I don’t think Tezos is a perfect blockchain, but as Ethereum improves its power consumption and scalability issues with proof of stake, sharding, and zero-knowledge proofs, the energy efficiency and cheapness of the Tezos chain makes it worth considering As an option for crypto art. Deciding which chain is best for artists is complicated, for example, while Ethereum’s fees are currently prohibitive, it supports some well-tested algorithmic stablecoins that can mitigate short-term price volatility, while Ethereum’s ecosystem and infrastructure is usually more developed than other chains (for example, it can accommodate certain features that are not available on the Tezos chain or are more challenging).

Personally, I’ve been using and exploring many different blockchains as they have different applications, research areas, and pros and cons (eg Mina is in early development and its focus on zero-knowledge proofs gives it some interesting features and use cases).

Not all tokens are created equal

It is also important to understand that not all tokens are built on the same protocols and smart contracts. Some tokens will use IPFS as the primary medium, and tokens like Art Blocks will embed the entire medium as software on the blockchain. An example of the direct use of on-chain media and programmable smart contracts is the artist Deafbeef, whose work Entropy is “downgraded” each time it is transferred to a new owner.

other concerns

Energy consumption: Ethereum is currently energy-intensive, which drives artists to move to smaller, less developed networks like Tezos (where energy consumption is negligible). This situation may change in 2022 with Ethereum’s migration to proof-of-stake, when Ethereum’s energy consumption will be reduced by 99.95%.

Fees: Ethereum fees are prohibitive, sometimes costing hundreds of dollars to mint a work of art. This tends to push people towards alternative chains and sidechains like Tezos and Polygon (which cost fractions of a dollar). Scalability may be improved in future versions of Ethereum, but it will take several years to fully mature.

Risk: There is a risk that is obvious to both the artist and the collector. Minted works may not sell, tokens may depreciate, and there are many security risks in the management of private keys (if you accidentally share your private keys online, you could lose all your funds).

Quality: Some platforms with a complete lack of moderation lead to many negative perceptions, as most of the content posted on marketplaces like OpenSea is of poor quality and even outright spam, pornography, and theft. Gorgeous profile pictures, avatars, and digital collectibles are often tossed into massive crypto-art mixing jars, and their high sales tend to grab mainstream attention.

Speculation: Extremely high prices in these markets are often the result of speculative behavior and sometimes FOMO buying, gaming, insider trading, and pump-and-dump behavior. Considering the sheer size of these permissionless networks, it can sometimes be difficult to distinguish fraud from others.

Volatility: Tokens can fluctuate significantly (appreciate or depreciate) on a daily basis, and users are often encouraged to withdraw profits, hold stablecoins, and avoid holding any coins that cannot afford the loss of value.

Looking to the future

Considering that crypto art 2021 has only just emerged in the mainstream, it is still in its early stages and its space and technology will likely continue to grow, evolve and improve. This requires a series of efforts: better curators, critics, exhibitions, technological development, management and new trading models.

With independent exhibitions like The Digital (Miami, 2021) and Right Click + Save (Singapore, 2021), we can see that the field is hard at work. Meanwhile, many more well-known artists, institutions and curators are cautiously testing the waters, including the Museum of Contemporary Art (MOMA), OÖ Kunst, Karlsruhe Center for Art and Media (ZKM) and Pace Gallery.

One article to understand the art of encryption and NFT

The Digital(2021)

A pop-up art show of crypto and generative art during Miami Art Week.

We still have a long way to go, and many of the token contracts and technical systems that crypto art currently relies on are fairly crude. I’m particularly interested in the new opportunities for collaboration and automated income distribution through programmable contracts, which have been applied in the collection sale of the Transfer gallery Pieces of Me (2021).

This post is merely an introductory-level discussion around crypto art, with the aim of showing the interest groups and communities that have spawned from it, while placing it in a broader art-centric context. There are still many points that can be further explored about this technology: file storage, governance models, consensus mechanisms, zero-knowledge proofs, and many works of art that deserve attention, discussion, and critical analysis, which I will discuss in a dedicated article later. .

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/one-article-to-understand-the-art-of-encryption-and-nft/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

Like (0)
Donate Buy me a coffee Buy me a coffee
Previous 2022-05-16 10:24
Next 2022-05-16 10:25

Related articles