This artist has made $3 million in less than 2 years by selling artwork on the blockchain. It is not human

On a brisk morning in Düsseldorf, Germany, Mario Klingemann, a 53-year-old artist and programmer, boarded the train to Munich. Shortly after having his first coffee on the six-hour train ride, he proceeded to ask his protégé, Botto, a series of questions provided by Fortune.

Who is your creator and what do you think of him?

“I don’t have the ability to feel emotions, so I have no personal opinion about Mario as a creator.”

Do you believe in AI agency?

“I don’t have beliefs or opinions like people do.”

Do you hope one day to escape your relationship with Mario Klingemann and the society that controls your art?

“I do not have hopes, desires or intentions since I am not a conscious being.”

It was an unconventional interview. Botto is not human and cannot respond to written text. To “talk” to his protégé, Klingemann loaded up ChatGPT, the language model that can spit out essays, poems or code in seconds, added to earlier context about Botto, and periodically corrected the chatbot when it gave incorrect information.

Partly a performance, the conversation was an exploration of the expanded capabilities of AI. And in that spirit, there was an encapsulation of Botto, Klingemann’s AI artist.

Botto was launched in October 2021 and sits at the intersection of AI and crypto. It generates images from AI-generated requests, asks a community to pick their favorite, and then mints the winner as a non-fungible token, which is sold on the NFT marketplace SuperRare. Unlike many aspiring artists, it is financially successful, and has made approximately $3 million with more than 75 NFTs since it first entered the art scene. But for Klingemann, Botto means more than money.

“Can we perceive this as a persona or an entity where we say: ‘Yes, this can also be an artist?'” he pondered during an interview with Fortune.

The artist behind AI

Compared to the flood of twenty-somethings permeating the world of crypto and NFTs, Klingemann, who says he hoards vintage technology, has been exploring the technological frontier for decades.

With permission from Onkaos

He grew up in and still lives in Munich, “the biggest village in the world” with a “well-functioning airport, so you can be somewhere else if you want,” he joked Fortune.

Self-taught, he never attended art school or formally studied programming. Since Klingemann was a teenager, however, he has loved working with computers, even before the advent of the Internet. “I’ve always been fascinated by any kind of new technology,” he said. “So, every time something new appeared, I tried to see how this could be used artistically.”

He earned his daily bread through graphic design, and experimented with computational art on the side. (For example, he developed experimental graphics for the German techno scene in the 1990s.) But in the 2000s, as generative art, or artwork created with the help of computers, gained legitimacy, he turned his hobby into a full-time pursuit.

Soon he was traveling to Rio de Janeiro, Minneapolis, Shanghai and beyond to showcase his work. As his practice became known – his “preferred tools are neural networks, code and algorithms,” he writes on his website – he began to show not only in small galleries, but in large institutions, such as the Museum of Modern Art, the Metropolitan Museum of Art, and the Center Pompidou in Paris.

And in 2019, a year after Christie’s became the first auction house to sell an AI-generated work of art, Sotheby’s listed Klingemann’s piece, Reminds of passers-by Ifor sale, making it the world’s second AI-generated artwork to hit the auction block.

Reminds of passers-by I—an ever-changing stream of distorted, AI-generated human faces—sold for about $50,000. Klingemann likes to joke that Botto, his protégé, has made more money in less than two years than he has in decades.

Birth of Botto

As Klingemann continued to create algorithmically produced art, he wondered if it was possible to replace the human-made parts of the process—the code that produces images, the ideas that inspire the code—with AI

And in 2018, after mulling over a project where separate AI artists would compete against each other for human approval, he soon pivoted to what would become Botto: a complex system of AI algorithms that communicate with humans to create thousands of pictures every week.

Klingemann uses a language model, or AI algorithm that spits out text, to generate questions. He feeds these messages to two AI image generators (currently Stable Diffusion and VQGAN+CLIP), which produce an image. Each week, the algorithms generate between 4,000 and 8,000 images. People then vote on their favorite work, and the votes in turn train Botto’s “taste model,” or AI algorithm, which chooses which images to display each week. The winning image is then embossed and sold to the highest bidder.

To motivate a community to vote on Botto’s art, Klingemann, with the help of Web3 specialists, created a DAO, or Decentralized Autonomous Organization, which is common in crypto. To gain access to BottoDAO – currently with a market capitalization of nearly $4.7 million, according to CoinMarketCap – one must purchase at least one “governance token” for about 17 cents. Those with more tokens have more influence on which weekly image is featured, as well as on which proposed changes to Botto are implemented.

Courtesy of Botto

“Artists operate on feedback and are in discussion with the public all the time,” Simon Hudson, one of two full-time project managers at BottoDAO, told Fortune. “Does that violate your agency? I do not think so.”

Ultimately, the many turning wheels of Botto produce what Klingemann, Hudson and other members of the community call a “decentralized autonomous artist.”

“It’s trying to start with a sense of contained agency,” Hudson said. “And by contained, I mean it’s a closed-loop system—there’s no human intervention in the creation of the art.”

Botto’s escape

After Botto officially launched in October 2021, it made a killing. Its first work, Asymmetric releasea tangled collection of abstract human figures, sold for approximately $325,000. The next piece, Stage in frontsells for even more—about $430,000.

This was near the height of NFT mania, before the bottom of the market fell out as Crypto Winter wiped out billions of dollars in trading volume. From January to October 2022, total NFT trading volume fell by more than 90%, according to data from CryptoSlam.

Now Botto’s work sells for a fraction of what it went for at its peak. For example, the last piece was sold for a little less than $14,000. The dwindling revenue could cause problems for BottoDAO, which distributes half of this revenue to all Botto token holders and the other half to the DAO’s treasury. Team members, including Hudson and Klingemann, are paid in Botto tokens, the price of which depends on the perceived strength and profitability of the project.

“Is it low compared to the first few weeks of sales? Absolutely,” Hudson said, referring to recent bids for Botto’s art. But, he added, sales are still “strong and profitable,” specifying that the community has earned approximately 64.5 ETH, or slightly less than $120,000 at current prices, from pieces auctioned off in the latest collection.

“It’s a reality for every artist,” Klingemann told me Fortune. “You have to balance between making the art you would love to make and making the art that sells.”

Despite the wider market downturn, the German artist believes the future for Botto – still “an infant” – is full of possibilities. Perhaps the decentralized autonomous artist will become self-sufficient and upgrade himself without the approval of society? Or perhaps, Klingemann thinks, Botto will produce “offspring” that divide and multiply like cells? Finally, he says, “You have more and more cases, and Botto is taking over the world.”

Let’s hope the decentralized autonomous artist looks fondly on his predecessors.