Will GPTs swallow NFTs?

Over the past few months, the world has witnessed the dazzling capabilities of GPTs (“Generative Pretrained Transformers”), which seem to become more impressive with each passing day. One of their most revolutionary breakthroughs has been the ability to create images – artwork and “photographs” – based on text messages for GPT programs, such as DALL-E, Midjourney and Stable Diffusion. Anyone can now become a visual artist using nothing more than text.

GPTs – including ChatGPT – are not without controversy. Copyright lawsuits have already been filed against several companies that offer text-to-image generators. Technologists trained ChatGPT using databases that include millions of copyrighted images produced by artists, allowing the AI ​​to generate new works. The lawsuits allege that both this AI training and the AI ​​generation of substantially similar works constitute copyright infringement. Critics have also raised concerns about privacy – including the alleged use of personal data, such as people’s social media photos, in the training databases – and about job displacement in many sectors, including art and design.

Anyone can now become a visual artist using nothing more than text.

While the courts and legislators will confront these controversies, how will the widespread use of AI text-to-image generators affect an art world reshaped by NFTs (non-fungible tokens)? In a short time, NFTs created a whole new market for digital art, with a boom of $27 billion in sales by 2021. Sotheby’s and Christie’s auction houses capitalized on this new market, selling $250 million worth of NFTs in that year alone.

NFTs are computer programs that create virtual ownership. Just as the software in smartphones creates virtual keyboards, NFT creates a virtual embodiment of the subject in a way that compares to a symbol (or virtual twin) of the subject. NFTs solved the long-standing problem of digital artworks – namely that they can be easily reproduced in infinite copies. Because each token is unique, with its origin recorded on the blockchain, the copies do not replace NFTs. In fact, the copies can even help promote the artwork by making it more famous. NFTs greatly benefit artists by “providing standardized mechanisms to manage provenance, payment, trading and distribution aspects, and opportunities to implement mechanisms such as [resale] royalties,” explained AI artist Roope Rainisto.

This shift to virtual ownership through “tokens” – what I call tokenism – in the 21st century is as revolutionary as Cubism’s shift from a single, linear perspective to multiple perspectives (embodied in “cubes”) in the 20th century. Both overturned conventions – cubism in perspective, tokenism in ownership – and opened vast new possibilities for artists.

Not only did NFTs create a new market for digital art, it did so in a decentralized way by bypassing the gatekeepers of the art establishment – the galleries, museums and auction houses. NFTs created a market open to all artists. As Rainisto, who is based in Finland, stated: “How would a relatively unknown digital artist from Helsinki, Finland ever ‘make it’ with his art. Through traditional art galleries? It would never have happened, not in a million years. The gatekeeping aspects has changed dramatically.”

But will GPTs now render NFTs obsolete? If everyone can become a visual artist by writing a few words, the supply of AI art will grow dramatically. On social media, where people are constantly sharing their latest AI creations, including their questions, it already has. Midjourney even uses a social network on Discord so creators can see, in real time, the messages and images they and others are creating. Midjourney has a new “describe” feature that analyzes any image and prompts you to recreate it. The images created at Midjourney are known for their distinctive “Midjourney look”. Why would anyone buy an NFT for AI art that you can make yourself?

Many creators who use GPTs follow other paths than becoming NFT artists.

Without a doubt, GPTs will dramatically expand the pool of visual creators and increase the competition among artists to stand out. But it is not likely to limit the use of NFTs by artists or dampen the market for NFTs for art.

It’s also important to recognize that many creators who use ChatGPT, for example, follow other paths than becoming NFT artists, such as graphic designers, branding consultants and social media influencers. So the increased competition among NFT artists may not be as dramatic as it appears at first blush.

What may prompt more AI content creators to adopt NFTs is the Copyright Office’s ruling that the Midjourney-derived images for Kris Kashtanova’s graphic novel were not copyrightable because “users are not the ‘authors’ for copyright purposes of the images the technology generates.” If the courts embrace the ruling, AI creators could adopt NFTs as an alternative source of income.

For AI artists selling NFTs, text-to-image generators are just one tool in their toolkit. Artists experiment – to develop their own artistic styles through a variety of techniques. Even if GPT-based platforms end up producing a banal mix of similar artwork, it will only increase the need for AI artists to sharpen their skills and figure out how to make their artwork stand out. Artists were already doing it with other AI tools before GPTs. For example, artist Jenni Pasanen uses AI tools with her own digital painting to produce amazing works of art. Another prominent AI artist Claire Silver described to NPR her own experimentation with various techniques, including hand painting and training AI with her own database.

“In the last 10 years we have experienced various forms of AI such as GAN, Deep Dream, and now some very advanced visual text-to-image generators, which open unprecedented possibilities for creating images,” explained digital art consultant Georg Bak. “I like to compare recent developments to the invention of photography and cameras in the 19th century. Suddenly everyone was able to make pictures and people at the time thought this was the end of painting.” It wasn’t.

As leading arts institutions acquire NFTs, other institutions will follow.

Even today, smartphone cameras did not end photography as an art form. So also AI will not end NFTs. “There are fine art photographers who still sell in the traditional world and also have their images embossed in the NFT,” explained Ada Crow, an AI artist, photographer and art historian. “I think the NFT market is here to stay, and the ‘traditional’ market is already starting to introduce it into museums.”

Indeed, the Center Pompidou in Paris and the Los Angeles County Museum of Art have announced acquisitions of NFTs for their permanent collections. The Museum of Modern Art’s recent exhibition by AI artist Refik Anadols Without supervision hypnotized number of visitors. As these leading arts institutions acquire NFTs, other institutions will follow.

We must not forget: buyers of NFTs are investors. According to a Hiscox survey, 95 percent of NFT buyers who spend $25,000 in a year do so for the investment. The aesthetics of art take a back seat. The investment potential boils down to the artist’s reputation and network — a principle that has long prevailed even in the traditional art world, according to leading art market economist Magnus Resch. We already understand this truism. Imagine that the late Andy Warhol created an AI image of a soup can and sold it as an NFT. Even if others can generate the same artwork by artificial intelligence, Warhol’s will have much more value than anything you or I have made.

AI and NFT are actually complementary technologies. Together, they are accelerating the transformation of the art world into digital art and more immersive, virtual experiences. As a study by the Art Newspaper showed, visitors to the leading art museums have not returned to their pre-pandemic levels. To stay relevant, museums must adapt. The researchers, Tula Giannini and Jonathan Bowen, identified the profound societal transformation with artificial intelligence and digital technologies, “Museums must be more prepared than ever to adapt to unabated technological advances in the midst of the cultural and social revolution.”

The William Paley Foundation even auctioned off 29 works of art, including by Picasso, Renoir and Rodin, that were entrusted to MoMA, to raise funds for the museum to grow its digital art collection and potentially develop its own streaming platform. This sale is driven by the recognition that profound societal transformations accelerated by the pandemic have changed people’s expectations in many aspects of their lives, which are increasingly virtual and mediated through screens. As The Atlantic‘s Megan Garber said it: “We live our lives, willingly or not, in the metaverse.”

“True live experiences with a virtual component are, in my opinion, the right way for museums to go,” explained Bak. “Museums can reach a much wider audience through exhibitions in the metaverse. It is undeniable that digital natives are more connected to NFTs, VR and large media installations, as well as live minting experiences and digital communities and interactions.”

The explosion of digital art and artificial intelligence, together with the new market created by NFTs, will usher in a virtual renaissance that defines 21st century art.

Edward Less is the author of Creators take control: How NFTs are revolutionizing art, business and entertainment (Harper Business 2023).

We would love to hear from you! If you have a comment about this article or if you have a tip for a future Freethink story, please email us at [email protected].