CASHING IN ON CRYPTO ART
What is NFT artwork? Chicago artists explain the gold rush, as one collection brings in $69 million
SaraLudy could buy her own island.Maybe. Possibly. Assuming everything goes the way it has lately for digital artists selling their work right now in the form of non-fungible tokens, or NFTs. Maybe then. Ludy has spent a couple of decades creating digital art and virtual-reality pieces and teaching the brave new world of new media at the School of the Art Institute of Chicago; last spring, after years in the city, she left Chicago for her dream state, New Mexico. She’s a significant figure in digital art. She’s not wading into NFTs to get rich quick. And frankly, who knows if she even wants an island?
That said, depending on what happens this month, after her first pieces of NFT art are auctioned — well, let’s put it this way, Ludy might have a lot more money in the bank.
Or not!
It’s hard to say — this whole NFT thing puts the “speculative” into speculative markets.
Maybe you’ve heard: In the past month or so, the art market for NFTs — that is, purely digital images or videos, with none of the tangible existence of traditional artwork — has exploded. Yet, NFT also operates via cryptocurrency. Which is something of a volatile question mark. And yet, the possibilities ... Ludy’s first NFT, titled “Fire Beach,” is a snapshot of a polygoned peacock. It was expected to go up for auction alongside a work by Beeple, an artist whose NFTs have gathered more than $69 million recently, making him overnight one of the most expensive artists in the world. Sales from the auction go to the Open Earth Foundation, a nonprofit advocating for sustainability in the tech world. But after that, sales of Ludy’s next NFT, to be auctioned through the NFT site Foundation, are for-profit, and there, the market is not merely promising.
It’s a gold rush.
And you know it’s a gold rush because Ludy is sharing this overhyped moment with such acclaimed digital artists as NFL tight end Rob Gronkowski (who has sold $1.6 million in NFTs), Lindsay Lohan (who sold an NFT of her face for $17,000) and the rock band Kings of Leon (which has made $2 million on NFTs). An NFT of Nyan Cat — that old internet meme of a Pop-Tart feline farting rainbows, created by a Texas illustrator — went last month for $580,000. Now the NBA is selling NFTs of game clips. An NFT of an early video posted on the now-dead social media site Vine sold for $17,198.
About now, you should have questions: Like, wait, what is an NFT again? NFTs, which have been around less than a decade, are a digital image, or tweet, or song, or video — basically, a
digital file of whatever, made unique and collectible, then authenticated through blockchain technology. Blockchain, true to its name, is a kind of database that groups information into tight blocks, which are then chained together in way to allow collective control. It’s run though a network of computers hooked into a common cryptocurrency and holds a digital ledger of a sale. It also decentralizes the file, making it difficult to hack the information. But again, buy an NFT and you do not receive a physical object. You may be able to display your shiny new NFT on a video screen or cellphone. But that’s about it. Often, you don’t own the image itself, or the copyright, the trademark, or even visually distinctive art — many NFTs are found online, everywhere. What makes a NFT unique is often in the coding. You are buying a certificate of authenticity . Or as the New York Times put it, you are purchasing “bragging rights.”
An NFT, in a sense, is more like a promise of artwork than actual artwork.
If it sounds like nuts, or at least too good to be true, you’re not alone.
Ludy herself says she’s been “hesitant” about entering the NFT market, yet hopeful.
“It’s an invigorating moment for the (new media) community,” she said. “Younger artists are being recognized, and some of my peers, who are brilliant and been at this a long time, are now having a moment because of (NFT). It’s a good energy. It’s refreshing. But at the same time, I don’t know, I feel I have one foot in the door — I’m still hesitant.”
Understandably. It’s a very 21st-century kind of spectacle — online, conceptual, full of celebrity and marketing jargon, driven by technocrats with too much money. It gained steam in the past 12 months as art viewing (and collecting) was made increasingly virtual by the pandemic.
Naturally, it brings with it very 21st-century concerns.
Ask established digital artists what they think of NFTs, you hear a litany of pros and cons — and a lot of skepticism. Those who see promise in NFTs call it a mainstream breakthrough for new media artists. Or at the least, a revenue generator for artists in a medium that’s had an uncomfortable relationship with traditional
institutions and collectors. (The art world likes one-ofa-kindness and digital art is pretty replicable.) Broadly, those with concerns about NFT cite a failure of imagination — in short, they say, the digital-art world is relatively nascent, with potential to reform the inequities and excesses of the art world, and NFT is more of the same.
Jon Chambers, a new media artist and teacher based in Chicago — and a close friend of Ludy’s — said the NFT market “seems to be mimicking the same hierarchy of the art world and how the wealth there gets distributed.” Like other artists critical of the NFT boom, he thinks that selling a “legit copy” of an NFT is “conceptually strange”; he wonders about a consolidation of wealth in the market “to a few people who’ve gained a foothold in cryptocurrencies and are able to buy these things.” Then there’s the issue of authenticity: “I have a friend who had their work sold (as an NFT) and had no idea. It’ll be a big problem. The ethical dilemmas have not been worked out.”
Nick Briz teaches new media at the University of Chicago and SAIC. He said his students have been obsessed lately with NFT. “But then, even they have complicated feelings about it.”
Like other digitallyfocused artists, Briz is concerned about the environmental impact
of so much energy being wasted on large networks of computers authenticating the transactions of a relatively few collectors. He called the market what others have only whispered — a bubble.
“Or really, it’s a fantasy, and if we all decide to live in that fantasy, it’s real, right? A dollar bill has value only because we decided it does. That’s a strongly held belief system. The same seems true of the NFT. If we believe NFTs have strength, they have strength. Lose faith, it crumbles.”
Like others interviewed for this story, he said he has “tremendous respect” for Ludy and her work, and he can’t blame a digital artist for tiptoeing into that market. He just doesn’t want to.
Same for Shawné Michaelain Holloway, a Chicago new media artist (and SAIC lecturer) who said her own digital art work — which is by turns conceptual, performative, interactive — doesn’t quite fit the passive model of NFTs. “But I could sell something there. And I’m sure I’m missing out on money. It’s just not how I see my work circulating. I think the money is the appeal. And that’s important. (New media artists) never had that opportunity to make this kind of money.”
But until she better understands the technology, “and why we’re doing this,” no thanks.
Ludy shares a lot of those concerns.
She’s heard the NFT craze referred to as a market manipulation, a pyramid scheme, a scam. Indeed, Art Newspaper, a longtime paper of record for the international art market, reported that investment firm Metapurse, among the most active buyers of NFTs, is also an active “production studio” of NFTs. At best, all of this sounds like a near parody of the art world. Many digital artists themselves find the details deeply confusing. For instance, you know we established that NFTs exist primarily as digital files? Artspace 8, a contemporary gallery on Michigan Avenue, just announced a new, 300-square-foot installation by Chicago artist Adrian Stein that incorporates a number of his digital images, each available to buy as a NFT. In a press release, Stein said the work “encourages the viewer to contemplate their digital existence within the never-ending world online.” It sure does!
Ludy jokes about tumbleweeds being sold on Etsy, and since she has tumbleweeds rolling across her property now, in New Mexico, “well, you know, if this NFT doesn’t work out ...”
She’s well known within new media arts; her work has been shown in the Museum of Contemporary Art Chicago, the Lincoln Park Conservatory, the Whitney Museum of American
Art and countless other spaces. She’s probably best known for her “Projection Monitor” project, during which she spent several years exploring (and sometimes creating art inside of ) the virtual world Second Life. Her work, usually digital, is concerned with nature and consciousness.
She’s not exactly a goldrush type.
She eased into the NFT market after looking closely at its framework, financials, any lingering issues. Before deciding to sell NFTs, she worked a deal with her gallery, New York Citybased bitforms, giving 7% of her NFT sales to gallery employees. For the Foundation piece (which she made a decade ago, as a collaboration with artist Nicolas Sassoon), 20% will go to an artist fund. She said the boom in NFTs offers one of the rare moments when artists hold significant leverage over a market’s shape, and she intends to use that leverage ethically.
“I see this space as a way of selling work then taking that money and funding other projects, like virtual reality. Entering any market is scary for an artist. You don’t know what to expect, but seeing friends and peers being able to finally support themselves, and buying each other’s art, it’s amazing. You hear, ‘God, I sold a piece for $5,000, and I never sold anything for that much.’ Who knows if this systems crashes and burns in a month, but if artist have opportunities to support their families right now, that’s beautiful. It kind that points toward a democratization. It’s also not perfect, but that’s something.”
She said she’s still trying to understand the environmental concerns.
But that seeming disconnect between traditional authenticity and digital promiscuity is pressing.
A lot of digital artists embrace the online replication of their works. But many find the idea of selling one “true” copy of a piece, a rejection of a fundamental promise of digital art. “One of the biggest questions with NFTs is whether NFTs actually incentivize interest in digital art,” said Briz. “I mean, for me, infinite reproductiveness is a strength, not a weakness.” Still, if you’re used to seeing your work copied online, one of the appeals of the NFT market, Holloway said, might be “in the citational practice that comes with it. You see people ‘minting’ work now that’s not their work, and there’s value in a record — who created it, who bought it, who sold it.”
Digital artists have long sold digital files, but with NFT, they have a way of tracking the lineage.
Chicago digital performance artist Thorne Brandt summarized the confusion and spectacle of the NFT market with a playful criticism titled “NFT Connoisseur 1” — a kind of mashup of Norman Rockwell’s 1961 commentary on modern art “The Connoisseur,” and “Everydays: The First 5000 Days,” the piece from Beeple that sold at Christie’s for $69 million. In Brandt’s work, the graysuited man of Rockwell’s painting (with his hands behind his back, considering a faux Jackson Pollock) now hovers before the Beeple blockbuster, a gridded collage of the pieces Beeple (whose real name is Mike Winkelmann) created daily for 5,000 days.
“One night I decided to do it because this was keeping me up at night,” said Brandt, who is also director of the Digital Art Demo Space in Bridgeport. “The ownership that comes from buying NFT doesn’t actually provide any type of security for the seller or the buyer, and I wanted to make something that was a blatant rip-off to prove this. I was also just curious if people would get angry — I was kind of hoping for some type of repulsion.”
So far, he hasn’t gotten any reaction.
Ludy said it’s taken a long time for digital art to get noticed and accepted, never mind sell for millions. Traditionally, digital art is sold on commission, sometimes a collector buys a file on a hard drive. And then there’s the worry that the technology containing the art becomes obsolete.
For income, she teaches, freelances, takes commissions; for years, she’s had a small side hustle centered on the digital retouching of horse photos. It’s a living. But the promise of the NFT market now, she said, has also opened up new chances to explain the potential of her first love.
“A friend of mine, who is around 70, called the other day: ‘Sara, I saw your kind of art on NBC!’ It was about Beeple and NFT. Which is cool. I mean, it matters. Every moment in art history gets met with resistance, until the new thing is adopted. That might be what’s going on. The profile of digital art has been ramping up for years. Now it’s the big one.”
But will she buy an island?
“No, probably not.”