We wrote about NFTs a while back and since that point the NFT market has cooled with some reporting that their NFT portfolio has dropped as much as 50%. Despite that, speculation has run strong with a number of high profile artists, media outlets and celebrities publishing their own NFTs. Are NFTs here to stay or is a flash in the pan?
Damien Hirst, an artist that has ridden the wave of popularity since he literally jumped the shark, is trying to figure that out himself with new works collectively and ironically entitled “The Currency.” The works are a collection of 10,000 NFTs that have a corresponding work on paper made 5 years ago in 2016 of his “spot paintings.” These works (he’s calling each a “tender”) will be released on HENI Leviathan’s Palm platform which supposedly is 99% more energy efficient than Bitcoin or Ethereum, the crypto world’s leading currencies.
While Hirst’s spot paintings might look similar, no two are the same and they each have a name generated via artificial intelligence from Hirst’s favorite music lyrics. (Each title of the spotted works was created through machine learning algorithms based on a database of some of Hirst’s favorite song lyrics. Some of the poetic titles include “Totally Gonna Sell You”, “Wet Moving Mirror”, “Grandfathered to the Gang”, and “My Vision Is Fucked.” Each piece is individually numbered, signed, and stamped by the artist with a microdot and a hologram featuring a portrait of Hirst.)
Now for the interesting part of Hirst’s experiment: After two months, the collector can either keep the NFT or exchange it for one of the works on paper, and they have one year to make their decision. By 3 p.m. BST on July 27, 2022, if collectors have not turned in the NFT for a print, the corresponding artwork will be burned. Likewise, If you decide to keep the physical artwork, the NFT will be deleted off the blockchain. Obviously, there will be an exhibition of the artworks before they are ultimately destroyed. (And possibly, the burnt canvases may become an NFT itself, similar to the Banksy “Morons” print that was recently burned by Injective Protocol, the blockchain firm that paid $95,000 for the print.)
Collectors can apply to get a Hirst print or NFT, by going to the Heni website and filling out a form. Each print is $2,000 and is 20cm x 30cm. Regardless of the outcome of the experiment, the Hirst works will be likely to sell out. He’ll pocket $20,000,000 and have a database of collectors: some that want to collect digital art and others that opted not to. He’ll probably also make a few bucks from the onboarding of new users onto these new NFT and crypto platforms as well; the lottery gives priority to users of certain platforms.
Despite the recent drop in value of NFTs some industry insiders believe that there is still more room to run. Gabrielle Segal, an independent art consultant and appraiser, believes that “the rapid adoption of cryptocurrency as an asset indicates the general public‘s increased comfort with the idea of owning a digital asset, which serves as an indicator that a good many collectors, possibly a majority, may ultimately opt for the NFT over the work on paper.”
Hirst himself also seems bullish on this idea with the artist keeping 1,000 NFTs and “will hold the NFTs (and the corresponding artworks if any of the NFTs are exchanged) for five years except for a small number he might auction off for philanthropic or charitable purposes.” As there is a preference given to heavy crypto users, it seems likely that there will be many NFTs in existence versus physical copies. To look at the contrarian approach, this might make the physical copy more valuable since there will be less of them.
In our opinion this data will be the true value of this experiment: what will people opt to do? Will we have more NFTs surviving or paper surviving? Regardless of the format, will people be able to enjoy their original Hirst work as an NFT or only in paper format? We have our opinions, but we’d like to hear yours. What will be more valuable and enjoyable in the future?