Crypto art: what is it and what is its future
In 2021, artists and designers began to actively sell their work on crypto auctions for huge amounts of money. And digital values, denounced as real money, have become an art market.
Today we will talk about what crypto art is and why soon the purchase of such tokens will become as common as paid promotion of an account in social networks (for example, situations when creators advertise their profile or buy Instagram followers).
What is NFT and crypto art?
Crypto art is digital art sold through an auction system on special platforms. Such art is equivalent to physical art because of the unique signature by which ownership of the work can be established.
All crypto art is sold with NFT tokens. A token is a set of encrypted data. NFT stands for non-fungible token.
An NFT token is different in that it is not interchangeable with another token and is unique. Such a system is one way to preserve copyright for a digital unit. For example, digital art. In addition, these tokens allow you to determine the true authorship and transfer of rights on the blockchain.
When purchasing a work, a token is also purchased, which encodes only one specific digital object: an image, a gif, a digital picture, audio, video, digital design, etc.
As with any new system, this one has its shortcomings. From a legal point of view, an NFT signature does not provide copyright protection for any work of digital art.
For many people today it seems strange to buy some pictures online and spend a lot of money on them. But if we were asked 20 years ago if we would buy real Instagram followers in order to become known to a wide audience online, everyone would have thought it was a joke. However, today almost every user wants to become a popular creator.
How it works?
Registration takes place not as in ordinary social networks, but through the binding of a wallet. This is a very important part as all crypto art is based on the blockchain.
Blockchain is a huge ledger that is written simultaneously by many computers around the world. It consists of a continuous chain of data blocks. Information about all transactions is stored on thousands of computers around the world, so it cannot be destroyed or faked, whereas data that is stored in one place is very easy to fake.
The blockchain system is very convenient as it is an open database of transactions. It is completely anonymous, as wallets and keys do not store personal information.
Registration and sale system
There are two ways to work with sites: you can own something or resale. For sale and purchase, registration on all sites is approximately the same: authorization through the wallet, uploading the work, entering it into the register. The work is laid out in the international network, where everyone can buy it.
To register and put something up for auction for the first time, you often need to pay the site. Prices range from $20 to $300. Sometimes the purchase of a product does not require investments, and for the sale, you need to pay to the platform so that the product enters the system. When buying a site, they take interest from a successful auction: from 5% to 20%.
Sales depend on two factors: luck and name. In order for unknown artists not to go into the red, you need to create a history of the picture, promote yourself, create a concept of creativity. Only under these conditions, prices for paintings will rise.
Crypto art perspectives
If crypto art is considered solely as art, then it is worth investing in well-known artists who are listed on the market, by analogy with real art. However, if you look from the point of view of earning on cryptocurrency, then the income or loss of the buyer will depend on the exchange rate.
The technology will continue to be developed, and the legal significance of the purchase and copyright protection will be decided. Against this backdrop, young artists will strive to tone up their work. Art historians will come into the market and will determine the leaders of digital art and thereby add value to their NFTs.