Two years since the historic beeple sale, what has happened to the NFT market?

On March 11, 2021, Christie’s sold Weekdays: The first 5,000 days (2021) by Mike Winkelmann, aka Beeple, for $69.3 million, making him the third most expensive living artist at the time. But instead of acquiring a painting or sculpture, the winning bidder for Beeple’s work received a non-fungible token (NFT) – a unique digital identifier that used blockchain technology to certify and verify ownership of this digital artwork.

Crypto-enabled sales had been growing before the Christie’s auction. According to NFT analyst NonFungible.com, the market for NFTs had already quadrupled in 2020, with the total value of transactions increasing 299% year over year to more than $250 million.

There were a number of eye-catching sales in the run-up to the Beeple sale: An NFT of popular GIF “Nyan Cat” sold for $600,000; YouTuber Logan Paul sold around $5 million worth of tokens in a single day; and mainstream brands also got involved, with the NBA partnering with Dapper Labs, which sold a tokenized “highlight” of a dunk by LeBron James for $200,000. Beeple itself had also previously sold a work for $6.6 million on the Nifty Gateway, an online digital art marketplace.

However, the Christie’s sale marked a landmark moment for the art world. With the single-lot auction, the 256-year-old institution brought the mechanism of NFTs into the eyeline of traditional art world observers, while inviting a new generation of collectors into its gilded orbit.

It was also the first time a major auction house sold a purely digital NFT, and the sale sent discussion of the technology into a fever pitch in the art world – leading to mainstream coverage beyond the collectors and gallerists who typically follow auction results. In other words, a wider, more powerful group of people were now paying attention. Violent proclamations followed. “I believe we are witnessing the beginning of the next chapter in art history, digital art,” Beeple said in a statement after the sale.

But since then, the mainstream perception of NFTs has been characterized as the province of swindlers and grifters rather than artists and innovators. More than $100 million worth of NFTs were publicly reported stolen between July 2021 and July 2022, according to Elliptic, and by last September, NFT transaction volume had collapsed by 97% from its peak in January 2022, according to Dune Analytics.

By 2021, many had assumed that NFTs would seamlessly enter the commercial art world, and yet even this prediction appeared to be losing momentum. According to Artsy’s 2022 Gallery Insights Report, only 11% of galleries were selling NFTs in 2021, and 67% said their clients hadn’t even asked about them. For the galleries that sold NFTs, half said their total NFT sales value was $5,000 or less. About 20% of galleries earned between $5,000 and $14,999 from NFTs, and only 5% earned more than $250,000 from selling NFTs.

This volatile, boom-bust image of NFTs is perhaps due to their close relationship with cryptocurrencies – unregulated asset classes used mainly as investment vehicles rather than art. While this perception has undoubtedly contributed to the dismal numbers above, there are still interesting pieces of art being made and sold as NFTs.

“With the bubble and speculation that was around NFTs in the early days, it unfortunately took away from the conversation around the art itself,” said Christopher Y. Lew, a former curator at the Whitney Museum of American Art and current chief artistic director of Outland , a platform dedicated to fostering critical discussions about new digital technologies. “Now that things have calmed down, we’re coming back to really talk about ‘What is the artwork?’

There are several examples of established and emerging artists using NFTs in unexpected and fascinating ways. London-based artist Shezad Dawood’s first series of NFTs, “Sea of ​​Redemption”, is a clever, satirical play on the “crypto cult” and a response to the NFT market crash, drawing on images from the oceanic ecosystem and the mythology. beginning. Educated at the Royal College of Art and with works in the Tate collection, Dawood sits firmly in the category of ‘established’ artists, alongside the likes of Loie Hollowell, Damien Hirst and others who have marked token-based works.

Dawood looks at the changing perceptions of digital art in a similar way to the rise of video art in the 1970s, which struggled to be accepted as art when it first emerged. “In the initial phase of a new medium coming into play, you inevitably have a lot of people trying it out, and then it takes a while for the dust to settle and more qualitative judgments to be made,” Dawood told Artsy. “I think we’re starting to create really interesting ways of thinking about this as an art form that’s not only valid but also viable in terms of shaking things up.”

This is not lost on institutions, many of which are beginning to recognize the importance of token-based artwork. With acquisitions at the likes of the Los Angeles County Museum of Art, the San Francisco Museum of Modern Art, and the Buffalo AKG Art Museum, NFTs are making their way into major public art collections.

Perhaps most significantly, the Center Pompidou purchased a series of 18 NFTs in a joint effort with the French Ministry of Culture. The series, which includes works by the likes of Sarah Meyohas, Fred Forest, Agnieszka Kurant, Jonas Lund and Jill Magid, will join France’s national collection of modern and contemporary art. “This collection confirms our support for artists in their conquest of new modes of expression, which are the basis of modern art,” said the museum’s director, Xavier Rey. Several other museums, from Kunsthalle Zürich to Palazzo Strozzi, have also organized exhibitions of NFT artworks.