Arts Opinion: NFTs Transform the Art World

Would you buy rights to a piece of digital artwork for upwards of a thousand dollars? Many enthusiastic lovers of non-fungible tokens, or NFTs, would. In the past few years, pieces have sold for varying prices, ranging from a few dollars to multiple millions.

NFTs are digital certificates of ownership of unique assets. Non-fungible simply describes something that cannot be interchanged with another because it has unique characteristics. For example, a tie-dye shirt is non-fungible because it is the only one in existence due to its unique pattern and colors. The same applies for NFTs. Even if two NFTs look the same, they each have their own unique identifiers on the blockchain.

A blockchain network is a decentralized system of recording transactions. Ethereum is the blockchain that NFTs utilize. For every transaction on Ethereum, a “block” of data is added to the database. The method by which data is stored makes it so that all transactions are irreversible. With every NFT comes a serial number, which serves as a means of identification. Unlike the content in a NFT, this serial number cannot be duplicated, which means that regardless of how many times someone may copy an NFT, the original will always be easily distinguishable.

There really is no rhyme or reason to the price of NFTs. Some buy for bragging rights, some buy speculatively in hopes of future return, and some buy because they genuinely appreciate the art. Like all forms of art, beauty is in the eye of the beholder. In many ways, spending nearly 1.5 million dollars on a gray pixel is no different than spending nearly 12 million on a few paintings of Campbell soup. However while many things about NFTs still remain unclear, such as their price, one thing doesn’t—the fact that they are revolutionizing art.

There are three qualities unique to NFTs which differentiate them from other mediums of art: authentication, longevity, and accessibility.

The formerly discussed serial number attached to each NFT guarantees authenticity. This authentication has been used in conjunction with various use cases, a very popular one right now being online communities. A number of NFT projects, notably The Bored Ape Yacht Club or Pudgy Penguins, offer benefits to buyers through member exclusive chats and virtual activities. 

Another benefit of NFTs is that they are not exposed to the limitations of the physical world. After all, they are a simple collection of 1s and 0s in a database. NFTs are dependent on the state of their blockchain, so a healthy blockchain equals a healthy NFT. This association means that, rather than tending to each individual NFT, you can just access the blockchain they are stored on. And, because of the irreversible nature of blockchains, as long as you don’t go out of your way to expose your account credentials, your NFTs are also safe from theft.

Furthermore, with over half the world online as of 2019 (Statista), NFTs allow unprecedented access to art. More and more people are being exposed to digital media because of NFTs, something that has no doubt benefitted the art industry. Digital artist Ali Sabet said, “I think this new and growing market has been exciting for artists. Artists are collaborating more, creating breathtaking art, and helping each other every step of the way” (Richter, 2021).

NFTs are, undoubtedly, improving the art industry, but environmentalists fear the possible effects of this oncoming digital transition. Ethereum currently uses a ludicrous amount of electricity, even comparable to that of countries, meaning that it has devastating environmental consequences. To address this issue, Ethereum is looking to implement a system called PoS, or Proof of Stake. Doing so would cut its energy consumption by a factor of nearly 2000, from 5.13 gigawatts to just 2.62 megawatts. This new system will dictate the success of NFTs in the future. Right now, with billions of investor dollars and the Earth at stake, it looks like Ethereum will complete the transition to PoS, so you can rest easy knowing that your Nyan Cat NFT, and the planet, aren’t going anywhere anytime soon.

While NFTs are beginning to emerge in the art world, their existence has important implications for the nature and value of art. As Mr. Greg Lock, director of photography, film, and related media and instructor in photography, said, “I think it is ironic that after the hyper-commercialisation of art over recent decades, things have boiled down to the actual transaction having more monetary value than the art object itself.” 

Regardless, the development and adoption of this new technology is still in its infancy, and its impact is yet to be seen. Student Nick Astorian ’22 said, “Through the internet, we have digitized libraries, banking, betting, and now finally art. NFTs allow aspiring digital artists to create original and uniquely identifiable artworks, another manifestation of the power of digitalization.”

Anyone can purchase or acquire NFTs through marketplaces such as OpenSea, Rarible, and Foundation. For more information, visit any one of these marketplaces to view NFTs in action.