Crypto art has seen explosive growth of late, with many content creators tapping into the space to get compensated for their creative work shared online.
The Growing Demand for Digital Art
Essentially, pieces of crypto art are sold via non-fungible tokens (NFTs), which are distinctive digital tokens on a blockchain that can verify ownership of any collectible such as music, art or animation.
The rise of crypto art came from the need to make digital art, which is very easy to replicate, unique and verifiable on a public ledger. Transforming art into non-fungible digital tokens integrates more scarcity value into the piece while giving the artist creator greater autonomy and recognition.
NFT art also ensures that the creator receives their fair share of the value, as there is no scope to cheat the artist out of their rightful royalties on a publicly viewable and traceable blockchain.
These one-of-a-kind digital tokens have offered a new lifeline to digital artists and creators by introducing a convincingly identifiable carrier of value for digital artwork.
Furthermore, Immutable digital artwork introduces a new model of interdependence for content creators by enabling them to control the distribution and sale of their work. Artists can also embed conditions of their work and practice into their work’s expression.
Therefore, NFTs have the potential to disrupt art marketplaces set by monopolizing big tech companies by giving the actual content creators control over their work and its distribution.
Heralding the Era of Fractional Ownership
Perhaps the biggest appeal of crypto art is the ability to facilitate content creators to program pre-determined ownership conditions into its very metadata.
The new form of tokenized artwork enables the content creator to broker their own smart contracts that determine how the crypto art is displayed, shared, editioned.
This feature promises to help artists carve out a new model of equity where they can sell out fractions of new and rare digital art to multiple art enthusiasts.
According to Amy Whitaker, a longtime blockchain researcher who has studied the proposition for NFTs artwork in equity ownership, fractional ownership of crypto art is a powerful tool.
“What’s beautiful about equity is that you’re designating a fraction as opposed to a dollar amount. That fraction can move. So if you own 10% of an artwork, and you sold it for a hundred dollars or a million dollars, you’re going to own something proportionately,” Amy explained.
Ramani Ramachandran, CEO of Router Protocol, sees NFT art as an investment where one buyer can resell their rare collectible for a profit. The original creator can also earn royalties on the resale as the unique artwork increases in value over time.
The Buzzing Crypto Art Market
According to the latest estimate from Nonfungible.com, the NFTs market has grown 705% in three years to hit $338M in value by the end of 2020.
Digital artists like Justin Roiland, co-creator of the popular Rick and Morty animated series, are flooding NFT marketplaces like OpenSea with their creations, and fetching huge profits from their work.
As demand for digital collectibles continues to grow, the nascent digital art marketplace dynamics could explode in the coming months.