NFTs - what they are and what role they can play for gallery owners, artists and collectors

NFTs - the internet of art

NFTs "live" like Bitcoin in a blockchain. In contrast to Bitcoin, however, NFTs are non-exchangeable tokens.

Each bitcoin can be replaced by another bitcoin.

NFT represent a unique object on the blockchain.

In a digital world, where basically everything can be copied as often as you like, NFTs are the tool to prove the origin and history of digital assets - for example digital art.

So it can serve as a digital certificate of authenticity for digital art.

Why is that interesting?

There is no digital art market without the possibility to prove authenticity.

Logically, the digital art market has exploded since the development of NFT.

Now some will say "this is all just drug money".

Others will see the emergence of a completely new market phenomenon here.

And as always when something like this happens, the question arises:

What does this mean for the established market participants?

As always when markets change, there are risks and opportunities for everyone involved.

We want to take a look at where these risks and opportunities lie for organizers, gallery owners, collectors and for digital and analog artists.

The digital artist

The "early visioneers"- they create digital art directly for the NFT market - photos, collectables, digital paintings ...

Anyone who thinks that a price of 1.495 is not particularly high - the prices here are in ETH. Converted to €, that's almost € 5,000

These digital artists are right at the top of the hype wave right now. You can reach your audience on Discord and Reddit, sell your art for ETH or XTZ and present yourself on platforms like opensea or hen.

Nevertheless, there is still the "old market" of the gallery owners with their reputation, their experience and their contacts.

There are collectors who do not have the digital affinity to set up an ETH wallet and to whom this digital market remains closed.

And when the hype flattens, the laws of the “old art market” get more weight again - then it could pay off for these “digital natives” to partner with gallery owners who have access to the trust - and the money - of the classic collectors.

The analog artists

Everything is very simple here: both opportunities and risks:

If a new art market is established in the digital world and money is moved there, there is a risk that this money will no longer be available in the analog art market.

So if you continue to concentrate exclusively on the analog market, you run the risk of this market becoming smaller and your own market situation worse.

On the other hand: the chances are promising:

A completely new market with its own laws is emerging. Also new creative possibilities.

To digitally market your own art, to vary it with artificial intelligence, to create 3D walk-through art in VR and to market it digitally ... all these are exciting new possibilities.

The collectors

Regardless of whether it is collected as an investment or out of a passion for art: a completely new form of art is emerging in its own market.

It's a bit as if someone had just discovered painting and an explosion of creativity was unfolding in this field:

Much will disappear into insignificance - some will find their place in art history.

The gallery owner

What exciting times! New art forms, new marketplaces, new artists.

The gallery owner's asset is his reputation among collectors.

He has the opportunity to take the fear of contact with collectors and introduce them to these new art forms and markets. And also to generate new sales here in the digital world.

With his unique position in the market, the gallery owner can pave the way for both artists and collectors to enter this new digital market.

On the other hand, the same applies to him as to the analog artist:

The analog market could in part be cannibalized by the emerging digital market. Then it makes sense to also play a role in the digital market.

organizer

Here is almost 1: 1 what applies to the gallery owner.

The organizer of trade fairs and exhibitions also brings artists and collectors together. Here, too, there is a great opportunity to help shape the digital art market at an early stage.

Conclusion

The digital art market is no longer going away. One can find that good or bad.

But from the above it follows: For all market participants - analog or digital - the following applies:

There is enormous potential here: cultural, creative and economic. Everyone in the market has their own specific strengths.

If market participants do it wisely, everyone will be able to benefit from each other's strengths.