Digital-only artwork fetches nearly $70M at Christie's

https://www.reuters.com/article/idUSL8N2L95VZ

by afkqs • 5 years ago

59 116 5 years ago

reuters.com

NoOneNew• 5 years ago

Now theres going to be a gold rush of anyone and everyone trying to capitalize on this.

Also, am I the only one that feels this is a new level of bonkers?

simplecto2• 5 years ago

I would say there was a frenzy equal in magnitude around the 2000s dot-com. Yes, this looks crazy because we have never seen it.

Then again, who would have thought we would get diapers and dog food delivered to our home the same day we order it?

Or that mini-flying machines would bring me a Big Mac?

The future is a very weird place, but the winners will be the ones who embrace the crazy.

Jason Calicanis has a good story about when he met the founder of Robinhood (The trading app). The idea sounded so nuts that it was worth a bet.

tyre• 5 years ago

Ok but all of those examples have real world uses. Getting diapers or dog food delivered, buying stocks for free, big mac delivery — these are all improvements on what existed before.

NFTs have…???

lm28469• 5 years ago

Yes, this looks crazy because we have never seen it.

They look crazy because they are, some people got too wealthy and completely lost touch with reality/real world issues. I doubt flying big macs and overpriced virtual art will do much for our future if you take into account things like climate change, there are so many things we could work on instead of these new shiny gadgets...

riskneutral• 5 years ago

This is a new level of crazy. Money is not real, it's a plaything for rich people.

rvz• 5 years ago

This one is a one trick pony as it is the first NFT to be auctioned at Christie's. The same hype happened with the first AI art on Christie's.

My advanced crystal ball predicts NFT scammers are going to ruin the craze and cause everyone to panic.

sk5t• 5 years ago

Is this high-class money laundering, or something else?

gruez2• 5 years ago

If you wanted to launder money there surely has to be more discreet ways than making a highly unusual sale worth millions?

KaiserPro5• 5 years ago

Not always, property in london is a way to launder money, thats pretty public.

themanmaran3• 5 years ago

Artwork has always been a popular way to launder money. Since its value is entirely subjective.

kkielhofner3• 5 years ago

What's really interesting are the terms of any payment made using Ether:

"Please note that you may elect to make payment of the purchase price for this lot in the cryptocurrency Ether. Payment in Ether must be made via a digital wallet transfer of Ether to Christie’s. The digital wallet must be maintained with Coinbase Custody Trust; Coinbase, Inc.; Fidelity Digital Assets Services, LLC; Gemini Trust Company, LLC; or Paxos Trust Company, LLC. Only Ether payments sent from digital wallets maintained at these platforms will be credited towards this lot purchase, and we will not recognize payments from digital wallets hosted at other exchanges or self-hosted wallets. The digital wallet must be registered to you, or, if you registered a bid as a company, then in the name of the company. You agree, upon our request, to provide documentation confirming that the Ether payment was made from a digital wallet registered in your name and maintained at one of the platforms listed above. Partial payments of a lot from multiple digital wallets will not be allowed."

It should be noted that all of these exchanges are US-based and comply with all know your customer and anti-money laundering laws, rules, and programs.

Doesn't mean that money laundering is impossible (US-based banks do it everyday) but it's interesting that they will take Ether but only from an extremely narrow list of whitelisted source Ether addresses.

Also makes you wonder what happens if you (somehow) send $70,000,000 to Christie's Ether wallet from a non-approved address. Presumably they wouldn't touch it and transfer it back but I suppose you never know...

pavlov2• 5 years ago

"makes you wonder what happens if you (somehow) send $70,000,000 to Christie's Ether wallet from a non-approved address"

Probably no different from sending an unagreed wire to their bank account? They'll just refund, maybe subtracting $50 for "processing" or whatever.

menage• 5 years ago

Given that on https://onlineonly.christies.com/s/beeple-first-5000-days/be... they mention that they accept Ether, but only if it comes from an identifiable account at CoinBase or a few other exchanges (specifically not self-hosted wallets) it sounds like they're explicitly trying to avoid being used for money laundering.

vannevar• 5 years ago

Or a high class form of pump and dump. "Sell" a worthless digital asset to an accomplice for a crazy sum of money, refund the money under the table, and use the resulting press to sell more worthless digital assets to gullible marks.

eli• 5 years ago

It doesn't need to be that explicit. There's no doubt a group of people who already have large crypto holdings and who stand to make even more if NFTs take off. They can just buy and sell things amongst each other.

jl27183• 5 years ago

This seems more plausible than money laundering. Probably also with physical art.

cj• 5 years ago

Here's a direct link to Christie's which has a photo of the artwork:

https://onlineonly.christies.com/s/beeple-first-5000-days/be...

cybert00th• 5 years ago

Seriously!? They don't discuss the artwork; what file format, if any, that the artist used; how it was stored; how it's accessed, nothing!

While the concept sounds very interesting, the reporting leaves much to be desired!

Kiro4• 5 years ago

It's an NFT. There's nothing stored. They bought a token with a string saying "this is an NFT of artwork.jpg by Beeple" more or less.

martin_a• 5 years ago

non-fungible token (jpg) 21,069 x 21,069 pixels (319,168,313 bytes)

I think this is the information you are looking for? It's somewhat hidden at the top under the hashes

LegitShady2• 5 years ago

It's an NFT. It's one etherium coin being flipped over and over again to more ridiculous speculators or the losers who end up holding the bag in exchange for a non fungible digital token.

It doesn't come with art, rights to publish, rights to copy, etc. It's just an etherium coin the original artist minted that no one else can copy, that they named after some work of art and sold.

NFTs don't make any sense without associated rights or goods they would represent, and even then they do the same thing as contracts without any legal enforce ability - you'd need a contract to enforce any rights sold with an NFT. The NFT would just act as a 'proof' token.

I don't get it. Where's the value?

genericacct• 5 years ago

It could be used as a way of tax-optimization in some countries I guess..

KaiserPro5• 5 years ago

but it doesn't come with any rights.

You don't get the copyright for this artwork, you own the token, not the art it's self.

its sheer lunacy.

KaiserPro5• 5 years ago

not to mention that the art its self is cheap, derivative and with no inherent meaning, unless you count the act of getting $70m for not actually selling the work as actual art.

bitminer• 5 years ago

21.7 cents per pixel.

Stock photos cost $5 to $100 and come with distribution rights.

Somebody paid a lot of money for bragging rights.

Accujack• 5 years ago

To someone with a technical bent, it (NFT creation and sales) seems pointless and crazy, but it's no more so than things like fiat currencies or stock shorting.

Essentially, people are gaming human psychology to trigger the desire to "own" something and creating an artificially limited supply of that something using crypto (which may as well be a cut and paste replacement for magic as far as most people are concerned).

Limited supply + desire = high prices for acquiring whatever is desired.

High prices plus near zero production cost for the "item" means lots of profit for little effort, hence all the interest in this right now.

pavlov2• 5 years ago

The production cost is not zero but it's been mostly externalized.

These tokens are like burning down a forest so you can press the ashes into a cute little trophy.

onion2k2• 5 years ago

You don't get the copyright for this artwork, you own the token, not the art it's self.

You own the art in the same way that you "own" part of a company by holding shares in it.

delecti• 5 years ago

There are real benefits to owning shares in a company. It's not as tangible as owning a more conventional object (like a book or pen), but there's actually a meaningful difference between owning and not owning those shares (like dividends or voting rights).

There are only the faintest wisps of connection between the NFT and the art. It's like an autograph on the cover of a book, but without the book inside the cover. And it's not even that tangible, because the autograph is digital, and there are no limitations on infinitely and perfectly reproducing the book.

KaiserPro5• 5 years ago

Thats incorrect.

When you buy art at auction, unless specified, or a print, you own the rights to all of it.

Its the same with a company, if you own all the shares, you can asset strip, pull apart, and generally do anything within the law to it.

unless explicitly specified in the contract of sale, the artist will retain the rights to the original work. Nothing in the NFT explicitly states that you own the original thing that you've generated the token for.

derivagral• 5 years ago

I think the gold rush was for the platform, right? The expectation is that those other mechanisms will come after the crowd picks a couple winning brands to "standardize" on. You want to win the usage/traffic, then you want to create those mechanisms for enforcement by leveraging your new legitimacy. If there's such a thing as a rational NFT investor I assume that's a line of thought for doing so.

I don't own or plan to own any NFT stuff, I agree it seems a bit nuts.

SpicyLemonZest• 5 years ago

The platform gold rush is exactly the problem. In the traditional collectibles market, the stuff you own exists independently of the platform you bought it from. If you buy Simon Bolivar's personal pistol, it leaves the auction house and goes into your home or vault or wherever; you get to keep it even if they go under, and a new auction house setting up shop won't be able to sell it. For NFTs, though, anyone building a new NFT platform can mint NFTs for whatever they'd like. So it seems virtually guaranteed that any "legitimate" NFT platform will eventually be crowded out by scammers undercutting its prices.

Food for thought: what is the NFT platform that Beeple used here? The NYT article (https://www.nytimes.com/2021/02/24/arts/design/christies-bee...) says his NFTs consist of "an image or video file, sometimes with a physical object attached, verified with a digital signature on a blockchain", but which blockchain, and whose conventions dictate that this specific signature on this specific blockchain is the NFT? The article says that minting an NFT "makes digital artworks unique", but how exactly does this happen - if Beeple decided he wanted to CTRL+C, CTRL+V, make another NFT, what obstacles would stand in his way? I searched around, and none of the articles I've found seem to know these answers or even acknowledge why these are important questions.

mattdesl• 5 years ago

When you but work from an artist, you own the “artwork” rather than a copyright of the artwork, ie you have no right to reproduce it.

The difference is that this is a digital artefact rather than a physical one, not all that different than buying a conceptual artwork (eg Sol LeWitt, which might be just typed instructions on an otherwise empty page).

UncleMeat• 5 years ago

In fact, you can create a NFT for anything right now and sell it even if you don't hold the copyright for that thing. Go find your favorite digital art from the web, stick it in the blockchain and create a NFT, and sell it! Literally nothing will stop you.

joshspankit3• 5 years ago

One main thing will: Your fraud is public record.

themanmaran3• 5 years ago

A little more info from an NPR article on the sale:

"That is, until about four months ago. That's when Mike found out about a new kind of blockchain technology that has been rippling through the digital economy: NFTs, or non-fungible tokens. NFTs are like certificates of ownership — unique barcodes that can't be duplicated — that can be attached to all sorts of digital files and make them into exchangeable assets. Mike's story offers a window into how NFTs are on track to dramatically reshape the art market."

(https://www.npr.org/2021/03/10/975782582/market-power-to-the...)

So NFTs are the new DRM?

koolba• 5 years ago

Not even. They’re the new digital beanie babies.

Kiro4• 5 years ago

No, it has nothing to do with copyright. You own a token where the only proof that it has anything to do with the artwork is the fact that the creator said so.

jiofih3• 5 years ago

Like.. a painter claiming that he painted what he is selling?

PragmaticPulp2• 5 years ago

So NFTs are the new DRM?

NFTs are in a weird state right now because they generally don’t give the holder any real rights or abilities. It’s basically proof that you for and control a cryptographically signed link to something else.

Like buying a link to a digital artwork, which is often available for free anyway.

surround• 5 years ago

An NFT is like a piece of paper titled with the name of the artwork and signed by the artist. Meanwhile, the artwork hangs in a museum and you have no control over it.

Imagine going to the museum and showing people this paper. “Look, I bought this piece of art!” But even though you bought it, you don’t own it, so you aren’t able to take it home or anything like that.

Kiro4• 5 years ago

At least the paper has their signature. This is like a paper with the artwork's name printed on it. The only value is that it was printed by the artist with the promise that they will not print any more. It's like buying useless memorabilias from celebrities. The only value is the fact that the item was used by the celebrity.

jimkleiber• 5 years ago

It seems like a digital signature of the work. If the artist signs 100,000 copies of photographs, the signed versions are worth a lot less, but if they only sign 5 in their lifetime, then they have more value.

At least this is how I'm going to currently reinterpret NFTs—as digitally signed artwork/merchandise—I may see it differently tomorrow.

krrrh2• 5 years ago

This is actually how lots of photographer artists operate. For instance it’s common for a piece to have 3 editions, and I don’t know of any cases where the artist just decided to produce extra copies after te original production, except for at cost to replace a damaged edition for a collector. It would be professional suicide to devalue work like that. The same goes for film, where a handful of editions may sell, and the collector essentially buys the right to display and loan the work in certain contexts.

That is nominally dealing with physical world realities, and the complex social norms at work through networks of galleries, museums, and collectors is a big part of what drives and maintains value and there’s really no reason that the title and provenance systems that work for photographic prints can’t work for digital art in the same way. In fact it has for a couple of decades already without NFTs.

avian• 5 years ago

An NFT is like a piece of paper titled with the name of the artwork and signed by the artist.

I know nothing about NFTs, but in the last few days I’ve seen a few people turn their Twitter accounts private where they previously posted their artworks. Supposedly to prevent sales of NFTs of their art without their approval. No idea if that’s a real issue or not. However there is another comment here saying they sold a NFT of Mona Lisa. It seems that a “piece of paper with a, possibly forged, signature” might be a better comparison.

dividuum• 5 years ago

Supposedly to prevent sales of NFTs of their art without their approval. No idea if that’s a real issue or not.

It is. I guess like with every new crypto pyramid scheme, a bunch of fraudsters show up trying to profit from the FOMO. Have a look at https://twitter.com/simonstalenhag for some examples of what one artist is facing right now.

capableweb• 5 years ago

No idea if that’s a real issue or not.

It is a real issue and the issue has nothing to do with NFTs. People been copying others art without their permission for as long as "art" has existed as a concept.

superfamicom• 5 years ago

I've seen a few places accepting anything, mostly with smaller NFT ideas:

- https://twitter.com/ricardojuchem/status/1369957369833226241

- https://twitter.com/simonstalenhag/status/136966166114619392...

- https://twitter.com/simonstalenhag/status/136968271596920832...

dagmx3• 5 years ago

I liken it more to (over)paying for the rights to a specific print of the art.

Much like prints, you don't own the art itself, or the rights to the image. The rarity of the print can change at any point.

Like many prints, a lot are not even from the original artist and are instead stolen and resold on any number of markets.

There's no real world value to a print, but in this case there's a significant real world environmental cost to acquiring it.

It's sheer stupidity of the masses IMHO.

Do cease and desists even apply here? For example could you tangibly ruin the market for a future NFT artist by flooding the market with their artwork before they get on it?

ecommerceguy• 5 years ago

>Meanwhile, the artwork hangs in a museum and you have no control over it.

One can most certainly remove their artwork from museums pretty much as they please or at the very least according to terms of a loan contract. Not to mention special access and privileges loaned artwork bestows upon the owner...

JMTQp8lwXL• 5 years ago

Exactly. There is no element of conspicuous consumption here to signal to others you own this expensive, one-of-a-kind thing. No, you bought a JPEG file and millions of it exist and you have no legal control of its usage by possessing the NFT.

krrrh2• 5 years ago

Traditionally collectors do have legal control over the display of a work even if it is digital. For instance a film artist may sell three editions of a short film and keep an artists edition for loaning to museums. If one of the copies is loaned to a gallery for a show then the owner might send a DVD or a digital file to the gallery. A gallery assistant might make a copy of the file, and watch it on their laptop.

But they can’t show the film in public and doing so outside of the social and institutional context where it establishes its value would be 100% verboten. There would also be strong social norms against sharing the file online or with friends. It’s false scarcity but it’s maintained by everyone involved because it’s part of the ruleset that creates a functioning economy. Anyone who exhibited a work they didn’t own or have loaned to them would be an instant pariah in the art world. All of this has worked reasonably well for years without NFTs. It wouldn’t be uncommon for Jeff Wall to mail high resolution images of his work to a magazine and even though the art director that received them could go out and print a copy that would look like one of the three legal editions, it wouldn’t allow them to participate in the work. But they would get to hang a nice photo on their wall even though they would pay the cost of all their artist and artist adjacent friends would considering them a philistine.

It’s possible that what we’re witnessing now is a true disintermediation of the institutions that make up the art world and the creation of independent pathways for meaning to be discovered and valuation to be determined. Is the art world changing or being disrupted by NFTs? Probably not really, they may be incorporated into art collecting in some limited way over time once the hype dies down.

The social context is still missing in the idea of pure NFT collecting and is missing engaging with or recreating a culture of art appreciation and patronage. Beeple aside, 99% of the NFT stuff out there is much more of a mix of speculation, consumption, and more appropriate for collectibles than art. A lot of the content is basic meme stuff, and memes derive their value from ubiquity, and democratization. The ethos of Reddit where people won’t even repost stuff that has a small watermark on it is more appropriate for this sort of consumable than anything you’d apply the word art to.

But I could be totally wrong, I definitely never anticipated what is happening now back in 2013 when bitcoin folks were going on about “coloured coins”.

jiofih3• 5 years ago

Aren’t many artworks on loan to a museum? Not much different.

Being the owner, you can take your painting or NFT home by not giving permission for any exhibitions.

DethNinja• 5 years ago

So could someone explain how NFTs can be used to launder money? Because otherwise they seems pretty useless with the exception that these can be used to access decentralised software as a license key.

vuciv13• 5 years ago

Wanna talk about NFT lunacy? I was able to sell an NFT of Mona Lisa. Granted, I only got $5 out of it, but the fact that I can make any profit off it is ridiculous.

https://jerseyfonseca.com/blogs/nft

arbuge• 5 years ago

And what were the fees you incurred to sell that?

Most NFT marketplaces won't let you list anything for less than about $100 USD equivalent last time I checked (a few days ago).

vuciv13• 5 years ago

Mintable.app is actually gasless. There were no fees.

jiofih3• 5 years ago

That’s plain copyright infringement. You can do it without NFTs just as easily.

EDIT: forgery.

ac29• 5 years ago

Can a 500 year old painting be copyrighted?

woah• 5 years ago

The Mona Lisa was never copyrighted

bhouston• 5 years ago

People buy cheap prints of the Mona Lisa all the time. I think that is just what you did.

vuciv13• 5 years ago

Good point. The internet is weird.

yepthatsreality2• 5 years ago

How much does it cost for an NFT of a photo of a Beanie Baby?

websites23232• 5 years ago

Stupid question time. Apologies in advance. Could the buyer print it out and put it on their wall?

yepthatsreality2• 5 years ago

I imagine as long as you have the data and call `.toString()` on it, then yes.

shawabawa3• 5 years ago

Yes. So could literally anyone else though.

PragmaticPulp2• 5 years ago

You could, too. No NFT purchase required: https://onlineonly.christies.com/s/beeple-first-5000-days/be...

Presumably the buyer gets a higher resolution copy that isn’t available elsewhere, but that doesn’t have anything to do with the NFT.

The NFT is just proof of a transaction taking place. It doesn’t actually transfer anything other than the token, though. The actual legalities are still handled through real-world contracts.

I wouldn’t be surprised if there was some sort of clause in the sales contracts that render the NFT null and void for the purposes of the contract if it’s stolen or lost or something. The NFT is basically along for the ride.

websites23232• 5 years ago

I guess I’m trying to figure out how rich people brag about their wealth. They can’t put this in a museum(?) and hanging it on your wall in your dining room isn’t particularly impressive either.

I suppose there’s lots of art just sitting in storage because it’s an investment medium, and this isn’t different?

kibwen• 5 years ago

Art auctions, the favorite money laundering scheme of the rich, meets cryptocurrency, the second-favorite money laundering scheme of the rich. A match made in heaven.

bronak14• 5 years ago

Theres way better ways to launder money...I think you might be thinking of tax evasion.

jl27183• 5 years ago

I don’t see how this could work, at least with US tax law.

weaksauce• 5 years ago

Art is a great way to launder money for the ultra rich. It's a pretty widely known scheme covered over and over again. here's one sample: https://www.forbes.com/2003/04/08/cx_0408hot.html

cannabis_sam• 5 years ago

At least crypto has critics, art has been abused by the rich for centuries, yet few people gives a fuck...

(Just to be clear, I don’t disagree with you)

dagmx3• 5 years ago

Art sales have been criticized too. It's just they generally are dismissed as some high falutin nonsense whereas crypto is more accessible by folks in other domains.

bobkrusty• 5 years ago

Some doing Technology abuse, some doing just for social image

bondarchuk3• 5 years ago

Anyone have the full-size image?

mattowen_uk• 5 years ago

It's yours for $71M.

antoniuschan992• 5 years ago

Here's a video about Beeples Everydays. I'm not a fan of NFTs (at least yet), but the video does mention Beeple's years of work as an artist. Whatever you think of the technology, it's really good to see artists getting paid.

https://www.youtube.com/watch?v=9zTpJJoHmnE

joshspankit3• 5 years ago

Beeple is the real deal.

antoniuschan992• 5 years ago

Also here’s an unboxing of one of his NFT artwork

https://youtu.be/PSm1rdd1ywc

johnyzee4• 5 years ago

Blah blah money laundering blah blah beanie babies. This is getting old, it's like when Google launches a service and comments are "So when will this be shut down?". It's lazy and brings nothing to the table.

On the topic, can anyone explain how the 'official' Beeple entry is identified on the blockchain? As opposed to any other address that claims to be the "Official Beeple '5000 days' NFT ownership token". My understanding of this is sketchy at best.

bondarchuk3• 5 years ago

While I completely agree that this here collective aneurysm (or shall we call it "cryptocurrency derangement syndrome") is painful to see, your lack of understanding can only be explained by the fact that NFTs of digital images don't work on a technical level. There is really not much else to discuss.

johnyzee4• 5 years ago

I was thinking if it could not be made to work with certificates. Like the artist signs a message handing over the ownership using his private key, which can be verified by his certificate from a trusted certificate authority, then commits that message to the blockchain.

bronak14• 5 years ago

The official auction has the artists wallet address listed and you can verify on a block explorer that its legit.

https://onlineonly.christies.com/s/first-open-beeple/beeple-...

wallet address: 0xc6b0562605D35eE710138402B878ffe6F2E23807 smart contract address: 0x2a46f2ffd99e19a89476e2f62270e0a35bbf0756

johnyzee4• 5 years ago

How do I know that that particular wallet belongs to the artist? I see some ENS entries on the address, but not sure if/how that helps tie it uniquely to a person.

nancy99• 5 years ago

Why can't I create an MTF that looks identical to a popular one that has already been sold? I can sell that fake NTF to myself for the same price the real one sold (so it looks like it has value and is real). Then I can market mine as the real one and sell it to someone for a profit.

CPLX• 5 years ago

OK HN help me out on this one. This whole NFT phenomenon just has to be primarily driven by money laundering right? Like there's no possible way a person, who is in possession of $69 million dollars, has decided that they'd rather have this image file right? It's impossible.

So we must conclude that what's actually happened is they have $69MM in gains, and they're a known entity, and they'd like to offset that with $69MM in loss somehow and transfer the gain to an unknown or untraceable entity. Or whatever the more accurate version of that basic dynamic is.

Am I wrong?

jl27183• 5 years ago

Pump-and-dump should be the first assumption. I think we get a bit fantastical to assume we live in a high-crime spy novel.

sktrdie3• 5 years ago

Isn't this how the entire field of "collectibles" works? Makes total sense to me. Why do people think this is lunacy and selling music isn't? (just curious)

anm89• 5 years ago

Good grief

sktrdie3• 5 years ago

What if the artist himself had all the crypto? Created hundreds of fake personas (addresses) and took part of the auctions to create hype on what essentially is buying his own work? Catching a few gullible people on the way.

xtiansimon• 5 years ago

I think we need a strong wealth tax here in the US. It would take Emoji domain guy 70,000 years to make this auction price.

Digital-only artwork fetches nearly $70M at Christie's

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