4 Ways the Art World Needs Blockchain: NFTs Spur Digital Art Explosion, Christie’s and Sotheby’s Sell Crypto, and Platforms Like Arcual Put Artists Back in the Art Ecosystem

However, it wasn’t until March 2021 that blockchain really exploded, thanks to Beeple’s record-breaking $69.3m (£50m) NFT sale of Weekdays: the first 5,000 days at a Christie’s auction. Suddenly, everyone was buzzing about blockchain, NFTs and crypto art.

Blockchain today has many applications in the art world, one key of which is verifying the authenticity and provenance of artworks. According to a 2014 report by The Fine Arts Expert Institute (FAEI) in Geneva, more than half of the artworks it examined were either fakes or not attributed to the correct artist.

By registering art on the blockchain through companies such as Artory, Codex or Verisart, data such as artwork details, records of previous sales, repairs, transport, exhibition history, ratings and image hashes are preserved on a single “block” that is secure and sharable. In this way, buyers and sellers can track a work of art throughout its life cycle with its authenticity, origin and history verified.

Blockchain technology has also inspired a whole new generation of artists, art forms, collectors and marketplaces, especially through NFTs, or non-fungible tokens. Case in point: the crypto art craze of 2021, where the likes of CryptoPunks, CryptoKitties, and Bored Ape NFTs were sold—some for over $100,000—by collectors on NFT marketplaces like OpenSea, Rarity, and Solana. Thanks to tokenization, digital artists could finally authenticate their artworks, create scarcity for them, and sell them directly to consumers.

New blockchain-based platforms have also emerged to give artists more control over their artwork. Last November, Art Basel and MCH Group announced the launch of Arcual, a new blockchain ecosystem co-founded with the Luma Foundation, a Swiss non-profit that supports independent contemporary artists.

With a mission to “put artists at the center of the art ecosystem”, Arcual offers smart contract solutions for creators and gallery royalties, customized payment terms, sales agreements, verified provenance and digital certificates of authenticity.

“Arcual was sparked by a conversation between Art Basel and [Swiss art impresario] Maja Hoffmann late in 2018, long before the NFT concept exploded, says Bernadine Bröcker Wieder, CEO of Arcual. “Back then it was just called art on the blockchain.”

What is unique about Arcual is that it was built from the ground up as its own blockchain specifically for the art world, while other companies use existing blockchains specialized for cryptocurrency. The company also starts with the primary art market and requires two-party verification – usually the artist and the gallery – to create the contract and a certificate of authenticity, making things even more secure.

“We make sure that what goes into the blockchain is really true,” says Bröcker Wieder, who hopes that Arcual will become a truly decentralized ecosystem in the future. “We currently have nodes operated by MCH Group, Luma and Boston Consulting Group, and we will slowly invite other art world entities to operate in our network.”

This year’s Art Basel Hong Kong, currently offered in a beta phase to galleries, will see several galleries with Arcual-certified artworks, including Galerie Mitterrand, Sabrina Amrani, In Lieu, Commonwealth and Council and Nathalie Obadia.

The new technology continues to inspire new and innovative art forms, such as Henry Chu’s Blockchain Piano exhibited by the Ora-Ora gallery at this year’s Art Basel Hong Kong. A digital art installation that mixes cryptocurrency with music, each key pressed simultaneously buys cryptocurrency while transforming the real-time market price into a musical note. The resulting melody represents market volatility, turning investment behavior into art.

“As a gallery of over 10 years, we want to continue to reach out to younger people, and I feel that NFTs can break down some barriers,” said Ora-Ora’s founder, Henrietta Tsui-Leung. “However, NFTs are only one form of blockchain, and we still see all kinds of technology as the creative side of Web3 and AI.”

Back in 2021, Ora-Ora became the first gallery to exhibit NFT artwork at an Art Basel fair, but Tsui-Leung believes there is still a way to go before blockchain-based art catches up with traditional and contemporary art forms.

“Blockchain cannot replace the traditional art market, as it is a very different market,” she said, citing the difference in collector profiles. “The NFT collector is definitely younger and probably in technology, but we’re very happy to see that these young people are very open to looking at traditional art as well.”

Despite its many direct applications, perhaps blockchain’s greatest impact on art is in bringing more eyeballs and attention to it, in all its forms.