How NFT art changed the landscape

Powered by blockchain technology and cryptocurrency, NFTs (non-fungible tokens) are revolutionizing the art market in Switzerland and abroad. But what is real change, and what is just sales rhetoric?

This content was published on August 8, 2022 – 09:00
8 August 2022 – 09:00

It’s common knowledge that the internet loves cats, and the beginning of NFTs showed just how much. In 2017, the blockchain game CryptoKitties allowed players to buy, collect, breed and sell virtual cats using the cryptocurrency Ethereum, the second largest digital currency after bitcoin. If you want to buy or sell digital art, including cat pictures, you will need a certificate of authenticity that proves the artwork is original. This digital proof of ownership is called an NFT, an acronym that is well established in the digital art scene.

It is a brief overview of the short history of a complex technology. But the real question is what does NFT art look like, and has technology ruined the aesthetics of art? A look at NFTs in Switzerland can provide some clues.

Swiss NFT artist Leander Herzog has been working with digital art, formerly known as online art, for many years. Like many NFT artists, Herzog’s background is in graphic and web design, and it shows in his art. His NFTs are colorful, abstract, minimalist and decorative. Herzog’s art is uncluttered and clean – as one would expect from traditional Swiss design – and it meets the art lover’s need to own a piece of art that is relaxing rather than immersive.

NFTs with plants and hybrid textures convey a sense of well-being, while other pieces seek to be fun or edgy. But Herzog doesn’t go there. With his graphic austerity and abstraction, he is not about creating a digital feel-good oasis.

The caption for Herzog’s Alp 1637831334 artwork reads: “minimal abstract Swiss landscape”. His Agglo series consists of animated black and white squares reminiscent of the early days of computer graphics. The medium and platform are futuristic, but his aesthetic is retro. This also applies to his Returngltf series which uses simple flat structures that rotate spatially. This series brings back school memories among the older generation as it looks like the colorful plastic pieces used to teach set theory in the 1970s and 1980s. The only difference is that Herzog’s colors are more attractive. His art is somehow arithmetical and seeks to integrate individual expressions into mathematical problems.

Finding potential buyers

Animated NFTs appear on digital frames, something screen manufacturers have picked up on. They now market small digital frames such as the picture frames used for family photos, as well as large screens that can be mounted on the wall. This indicates that NFTs are not only aimed at geeks and classic art collectors, but should also attract beginners who previously had little or nothing to do with art.

Major Swiss gallerists who play an important role in the art market and meet art collectors and buyers at major fairs such as Art Basel or Art Cologne have also started selling NFTs. New jobs as NFT advisors have appeared and specialized online magazines report exclusively on NFTs, such as the Swiss website artynft.io, the brainchild of three young people from Zurich. The trio only reveal their first names and publish English interviews with NFT artists. The “NFT Granny” section guides newcomers or older generations through the intricacies of digital art and answers questions like “How do I display NFT art at home?”, “Where can I buy it?” or “What is NFT?”

The language and topics of NFT sites such as artynft.io still have a long way to go to match comparable publications or critical debates about art. But they make art more accessible to everyone, even if they can also be money machines. The main goal seems to be to attract potential buyers to this new type of art and make everyone a winner.

Not part of the art market yet

For artists and gallerists who make big money from conventional art, NFTs are just an addition to the product range, while those artists who were unknown before the big NFT hype fetch the highest prices for their digital images.

The great advantage of the internet is that it drastically reduces production costs and makes it possible for artists with little money to join the market. Young agencies like Metaroot in Zurich, known for their events and digital communication, play a big role in this new art scene where the age of the artist seems to be irrelevant. Metaroot has used the rabbit sculptures of Max Grüter, a 67-year-old artist from Zurich, and turned them into NFTs. The Bunnymen collection is now for sale on opensea.io, one of the largest NFT marketplaces in the world.

Metaroot’s witty explainer videos show that the market is still in its infancy. Despite the high selling prices, the videos do not talk about the art, but about the technology used and the possibilities that exist. They encourage viewers to jump on the bandwagon. Back in the day this would be called a gold rush.

Like Leander Herzog, Max Grüter’s digital art didn’t just happen. For around 20 years, Grüter’s 3D sculptures could be accessed through a free online library called 3D Warehouse, but today the focus is more on creating value and getting into the market. And yet, old Internet values ​​such as openness and access for all are not completely gone, which is due to the technology that makes NFTs possible in the first place.

The Holy Grail of Cryptocurrencies

No one owns an NFT, even if it is worth millions of dollars. Once sold, it can continue to circulate freely, but only those with a certificate of ownership are allowed to trade it. An NFT is stored as a code on the blockchain which is the same technology used for cryptocurrencies. The blockchain puts the code in decentralized storage and stores each transaction as an encrypted file to prevent fraud. If an NFT is resold, the artist will receive a share of the price. This is entered in the NFT and cannot be changed.

On the one hand, this may sound like digital communism because the artwork is available to everyone everywhere. There is no need for a museum to curate the art or charge admission, and this can be intimidating to some people. There is also no obvious difference in quality as there is between a poster in the museum shop and the original displayed behind bulletproof glass. And nothing is hidden away in a safe, at least not the artwork.

On the other hand, the hype surrounding NFTs shows features of hyper-capitalism that aims to abolish a state’s rules and regulations. The new crypto-rich elite want nothing to do with banks or the government.

A recent history of NFTs reveals both its libertarian and leftist sides. In early 2021, an artist known as Beeple earned almost $70 million (CHF67 million) when he sold his digital collage of around 5,000 images in the first digital-only art auction at Christie’s auction house. This put Beeple among the three most valuable living artists. The buyer, a crypto investor himself who goes by the pseudonym Metakovan, fueled the NFT hype by driving up prices. Beeple’s pictures would never have made it in the conventional art world; NFT is about money and about giving the old art elite the finger.

Lost credibility

The call for participation in this market and the almost ethereal events hide the power structures. Digital transformations can get rid of old hierarchies, but they also create new ones that can become even steeper. Some NFT artists like Beeple have made extraordinary profits. NFT marketplace Opensea has grown exponentially, but was overtaken by Looksrare in terms of sales volume. And after NFT experienced a bumper year in 2021, losses have been extreme in 2022, up to 50% in the first quarter alone.

The next financial crisis will not only affect so-called fiat money, legal tender. The value of cryptocurrencies such as bitcoin and Ethereum have fallen significantly due to interest rate hikes, investors offloading their assets and falling prices. It is nothing new. As cryptocurrencies have become part of many financial investments, the markets can no longer be clearly distinguished. They are linked and both lose value.

If NFTs become an integral part of global investment strategies, they will lose not only their high value, but also their rebellious rock’n’roll status.

NFTs and cryptocurrencies need to regain the credibility they lost due to the high fraud rate of the market. Up to 80% of the NFTs displayed on Opensea are reportedly fakes and are copies of famous works of art without ownership certificates. The energy consumption of the blockchains where NFTs are stored is also irresponsibly high. This is mainly due to the proof of work protocol required to regulate and verify blockchain transactions on the internet. However, the proof of stake protocol can solve the problem as under this system the NFT is not stored on the blockchain – you get a stake in it instead.

The creation of NFTs is very carbon intensive, and a significant reduction of carbon emissions in production can save their reputation. Otherwise, a prayer at an NFT gallery may be your best bet.

Translated from German by Billi Bierling/ts

In accordance with the JTI standards

More: SWI swissinfo.ch certified by the Journalism Trust Initiative