Report Chronicles How NFTs Are Transforming the Arts Marketplace
NFTs—nonfungible tokens that are stored on a blockchain—have burst onto the economic scene as a new way to sell and trade items, including art. A new report provides timely commentaries on how this technology is changing the ways art is bought and sold. The report, a primer for individuals curious about NFTs, was written by researchers, graduate students, and alumni at Carnegie Mellon University (CMU).
“NFTs and blockchain technology are transforming the arts marketplace,” says Brett Ashley Crawford, associate teaching professor of arts management at CMU’s Heinz College and executive director and publisher of the Arts Management and Technology Laboratory at CMU, who co-edited the report. “The impact on artists, the politics and power of dominant blockchains, and the ethics for the planet and the future of humanity spur questions about who wins and who loses, and what are the true costs of playing the game.”
The arts marketplace has long been modelled on an intermediary-based sales system: Consider, for example, a gallery owner who coordinates the sale of art between an artist and a buyer, earning a commission for the exchange. Technology has complicated matters, challenging the traditional ways people view, buy, and sell artwork.
For economic, legal, and tax purposes, purchasing a piece of art is purchasing an asset, which can accrue or lose value. Thus, issues arise over who owns what, when, and where. Blockchain technology is one more player in the system of ownership and brings with it risks and benefits. This collection includes four essays:
- In “The Origin of Crypto Art,” Yuxin Du discusses crypto artists, who publish digital artwork directly onto a blockchain in the form of an NFT, showing how an avant-garde experimental effort developed into a multi-billion-dollar opportunity.
- In “A New Age of Digital Art,” Rachel Korsen focuses on the current NFT art world and NFT marketplace, explaining how NFTs came to be and what artists and art administrators should consider when using this technology.
- In “Fueling the Global Flame: A Look at the Long-Term Sustainability of NFTs,” Katie Winter writes about the dark side of NFTs—the climate-related costs of technological collections—investigating the cost of blockchain technology and the differences between two dominant models with significantly different impacts.
- In “NFT—Evolution or Revolution?” Ari Lightman frames the past and the future of NFTs as part of both the standard digital marketplace and the experience economy.
Summarized from a report published by Carnegie Mellon University, The NFT Art Marketplace: Trends and Considerations edited by Crawford, BA (Carnegie Mellon University), and Rodriguez, L (Carnegie Mellon University). Copyright 2022. ETC Press.
About Heinz College of Information Systems and Public Policy
The Heinz College of Information Systems and Public Policy is home to two internationally recognized graduate-level institutions at Carnegie Mellon University: the School of Information Systems and Management and the School of Public Policy and Management. This unique colocation combined with its expertise in analytics set Heinz College apart in the areas of cybersecurity, health care, the future of work, smart cities, and arts & entertainment. In 2016, INFORMS named Heinz College the #1 academic program for Analytics Education. For more information, please visit www.heinz.cmu.edu.