Do you have some spare money you’d like to invest? Are you keen on experimenting with a novel asset class and, possibly, netting incredible profits? Then now’s the right time to invest in crypto art. This very year, CROSSROAD, a work by the artist Beeple, sold at a whopping $69.3 million – after bids started at just $100. Sounds promising, right? It’s no wonder that crypto art is an extremely hot topic among investment pros.
But what is Crypto art, exactly?
Obviously, we’re talking about some kind of digital art – yet digital art has been around for many years. So, what’s new?
Well, until recently, it was close to impossible to collect digital artworks professionally because there was no established system. The problem is this: The value of an artwork depends on its rarity. Think of art prints, for instance: The more limited the edition, the higher the value of each print (ceteris paribus). Thus, if you could reproduce a work of art indefinitely, the value of each copy would become negligible. But it’s generally very easy and cheap to reproduce digital content. So, the challenge consists in limiting the quantity of a digital artwork to create digital scarcity. Once you achieve this, you can treat digital art just like physical goods, say, a traditional painting or sculpture. You can sell or buy it. You can acquire verified ownership. And you can authenticate or collect it.
How does this work?
The verification is completed using an NFT: a “non-fungible token”. They are built on blockchain technology. The blockchain offers a digital record of transactions. In other words: It shows who owns which digital file, how much it cost to buy it, and who has previously owned it. It’s so secure that it’s even used for cryptocurrencies like Etherium. Whether you buy Ethereum, a Bitcoin or a work of digital art – in any case, the blockchain serves as an incorruptible proof of your ownership.
By now, these “crypto” or blockchain systems have proven so dependable and convenient that they are even used to track physical art and to differentiate it from forgery.
Great, but where and how can you buy crypto art?
You can actually buy it on eBay. Christie’s and Sotheby’s are options, too, as is the online platform 1stDibs. But there are also vendors – and lots of them – who specialize in selling crypto art, e. g. Crypto.com or Nifty Gateway, the platform where Beeple’s spectacular art sale took place. Not all of them accept regular money. Instead, you may need to pay in Bitcoin or in Ethereum. But no matter the currency: Crypto art is a worthwile investment, that’s for sure. Once the digital infrastructure evolves, this novel kind of art will become more and more prominent and the demand will keep growing.
Image credit: Designed by katemangostar / Freepik