Fanny Lakoubay : The Impact of NFTs on The Art Market

Transcript

all right it's never seen before we're gonna start early at a crypto conference yay all right well uh after ben's talk about everything else but art we're back to the art um application of nfts and um i'm gonna introduce myself because i always forget so i'm going to start with that i have the pleasure to uh advise collectors who want to enter the nft space uh and yes they are people outside of crypto interested in nft and crypto art that's the great news i also collect myself it's quite an addiction you know it's not registered

as a official addiction but it should so we do a lot of community projects for the space and it's a it's a quite brand new um application uh uh i mean space in itself uh so we do a lot of um of projects like green nfts or vastaries like helps helps museums get into crypto for example and then i do a few projects like more on the impact side with radical exchange and east local so you can find me after if you want to hear about this all right so actually before that i'm going to give you a few

introductory comments and ask you two questions so who doesn't know what an nft is oh oh okay well come on non-fungible people and who does who doesn't know like why nft are interested interesting in for digital art okay so uh great so i'm going to skip the definition of nfts but interesting things for digital artists is that for the first time ever um they could actually create works um in limited editions or even unique uh editions of their work so before crypto um

you know there was no difference i mean there was a you had a jpeg or a video or software but it was replicable in indefinitely uh so for the first time with nfts you had a digital artist have a way uh to say like my jpeg is not a poster and it's an edition of uh 10. so it's really if you think about it like the defense of a photography that the poster sold at you know museum work museum shops uh and an actual edited um limited edition you know photograph so um there are a few other like interesting things for artists because

uh it's recording informations like provenance authenticity um you know like ownership uh and these are things that are a pain in the ass when you're in the art market and you're trying to figure out where a work uh come from they're like armies of specialists and a researcher were often times get it wrong and uh and and it's it's creating a mess so it was really i mean at least for me like in the art market you have many other applications but for digital artists this was really um the main attraction and then you can ask jean who's right here with a great uh crypto artist uh to see if he he has other things to say uh for uh nfts

um so if you attended the goaties talk this morning uh obviously art or ben's talk before this one like art is not the only applications of nfts and if you look at uh that like division by projects really art platforms are really like tiny percentage of the nft industry and uh with non-fungible data from this morning very fresh uh like art really like only is like 14 of the volume traded on a serum in uh the first semester of 2021 with collectibles which is up to 66 percent

so it's still quite a small application but um but it's it's an application that people understand so um so you've seen a lot of um you know news in the media like it was like massive bubbles speculations then there was christie's that auctioned the people work and and then like chaos like started like the art market was like what is this like i don't like it this is bad this is bad art like started like studying like people's uh in detail and uh it really like revived like passions and like you know you either like love it or hate it uh and the origin of

that bubble in like march april uh was if you remember that was at the time when uh like cryptocurrencies and bitcoin really like went to like like all-time highs and uh crypto holders like wales like really tried like started diversifying their portfolios and then saw like nfts as a good diversification and uh and then and then a lot of flippers came and a lot of speculative uh projects and then everything everybody said you know nfts are dead like this is over like get back to uh what you were doing before which you know is not true uh i mean we all

know especially in crypto that there uh there's a lot of volatility and bubbles and market corrections and then after that it's time to build and like you know stabilize the market and uh and and start working for the long term so this is pretty much where we are i wanted to give you like this like historical introduction uh and uh and really like to um talk about um the real relationships and some use cases of relationships with crypto art projects and traditional art players but for now this is very much the relationship

between crypto art and the art market i mean if you read any article from any art publications especially in france it is massively negative massively i mean this is like oh everything is bad and everything is like just like and and so on and so forth so it's typical french i mean i'm french so i can say that but um but it's it's it's quite the state of you know boxing game so if we take the side of the uh crypto um and nft marketplaces they are a million a day or like at least 45 a day like new marketplaces that pop up and uh and at the beginning really like for the

past three years you really had for art uh you had open c and variables that are like aggregators and um you know kind of what i call horizontal marketplaces with everything from art to collectibles to uh to everything and then you have um we had pretty much non-origin in the uk and super rare in the us since then a lot more appeared i listed some of the major ones so if you work for an nft marketplace that is not listed here do not you know kill me um but you know this is just to give you an idea so uh as i said like so variable open c zora and um uh

nifty's and hicket nunc uh are permissionless which means that like everybody uh even my daughter uh actually can create uh nfts and list them uh on these platforms then you have the invitation only which a lot of people have called created marketplaces and i will kill you if you say they're curated they are not they're invitation only and there's a big difference so we can debate that after that talk but uh to be on super rare non-origin makers place this little guy here is foundation or nifty gateway um you either have to be like very good friend with the founders or uh you know apply and and wait uh for um your applications to go through

and then and then you have the created very specialized uh marketplaces and uh you know like there are a few like it's the one that worked with a very very um small set of artists uh and and even these ones like you could argue with me that they're not fully created uh and uh but folia is a nice like small project from berlin blank dot art has worked with very few artists including um um sarah which i'm blanking on the name palm is the infamous uh new um like actually sidechain uh on

which damian hurst uh is launching his project we'll talk about that later uh and snog.art is a platform that actually uh now focuses on russian artists so these are the ones like so it's nft marketplace is involved in art and then on the other end you have the traditional art players uh who are now getting involved in nfts i'll pass quite quickly because i want to go to the use cases but this is very opportunistic right now so if you think about like if you take auction houses auction houses what is an auction house an auction house is a broker between finding uh inventory finding the sellers and connecting them and find two uh

buyers that they find with their armies of specialists who are all salespeople and auction houses like this like um you know opportunity and uh and there are a lot of crypto punks uh already that have been sold at some of these auction houses and and it's a very opportunistic move it's also a risky move so you know it's uh it's not like um i mean it's great that they're getting involved but it's still very opportunistic galleries so galleries actually the interesting thing is that they're not that many uh who are getting involved in crypto and in nfts because if you

think at the beginning what did blockchain promise they promised a more direct connection like almost peer-to-peer connection between the creator and the collector without uh intermediaries so they said like you know like great leg we are giving back the value to the creator meaning we are killing the galleries were like the bad guys taking the high fees which is true they were taking like up to like 50 percent uh of um the artists like proceeds but um but what we forgot in the meantime is that galleries like the good ones we're actually uh taking a fee uh by providing a service to the artists like

uh supporting them in marketing in pr in um you know like even technical uh support uh and and now like if you ask the artist they're quite left to themselves like to figure it all out they're now their chief marketing officer chief technology of research if pr officer and a lot of them are like i don't want to talk about my art i just want to like create art like i'm not good at that and and it's slowly i mean pace is like now getting more involved but they all have like this like wait and see position like the more traditional art galleries there are new ones that just appeared with crypto like cade vas and uh and breezy art i mean not even

kate vass was here a bit before and but a lot of the ones that are interesting to follow are the digital art galleries so digital art as i said like uh has always been a niche and and not very regarded in uh in any um you know like as a real piece of of the contemporary art market but there are a few like beat form uh in new york uh left gallery uh in la transfer no left gallery in berlin transfer uh in la uh who have been dealing with digital art for now like many many years and uh and are bringing this expertise

so it's quite interesting to uh actually follow what they say because they know the needs of the artist um anyway so that's kind of my take on it like i'm sure there are many different other takes and the fact that the gallery is kind of like ah yeah i don't know like let's see what happened i'm not really sure if i want to get into that weird space uh actually left a lot of space for museums to get involved and you know museums have this like reputation to be like slow i mean if you work in the art markets the last customer you want to work with is museums because you know um this is gonna be like at least a year negotiation like board approvals and you know like public money

in france and so on and so forth so like no um but museums like work like have this like um they have a lot of expertise in uh in conservat conservation and when you talk about digital art people are like yeah it's great like you know no logistics no like shipping and storage and no conservation wrong like there are a lot of issues with like digital art conservation and if you think about the early computer art days uh where you know like they were like ver like digital art on very old tv monitors like these tvs don't exist anymore so what do you do when this technology actually disappears like um so a lot of museums have really

looked at it you have the uffizi museum in italy who actually tokenize like some very famous works we have the whisworth gallery right now is working on a new project and they've been very much part of the discussion which is quite interesting and and quite revolutionary um and now ta-da we mix them all together shake it and uh like a few relationship uh relationships did uh appear uh in the past months and and here i'm listing more of the transactional ones like with uh with uh like nft marketplaces who partnered with um like auction

houses mostly actually uh to sell works and i'm gonna actually talk about a few uh of this so don't get me wrong i'm listing like pros and cons because this is all great and like but this is extremely new and and even the auction houses or the nft marketplaces they're discovering what they're doing by doing it so there's a lot of like things that have gone wrong and things that we are figuring it out right now so it's quite interesting even like over a few months to go back in time and see uh what was

really well done and quite like revolutionary and something or like what did you do why did you do that um so the first use case was people of course like that sold at christie's on march 11th for 69 million dollars and um it was you know we can't say like anything different it put the mainstream eyes on nfts and put it on the radar for uh people to actually understand the value of that technology and christie's as an amazing marketing and pr force so this was like a very positive um impact on the nft market and then they accepted like crypto payments

and even for their uh buyers premium which is quite high it's between like 13 and 25 and at the last moment when they saw that uh the highest bidders were um was metacovan so a crypto uh whale um they did accept crypto payment not only for the main price but also for the buyer fees because metacognt could absolutely not pay the various premium in uh dollars so that was great right like that was like quite like new things an amazing new experiment but there is no absolutely no record of that sale

on chain so the whole idea of like you know like using blockchain for provenance authenticity and like blah blah blah is absolutely non-existent it is only pretty much listed on christie's website and in our like social in a social contract that we all remember um because for example the work was minted after the sale on maker's place which is kind of random i mean you know like why make his place not sure um and uh and all the sale payments as all the transactions were done on christie's website which having worked at christie's is quite antiquated and not

connected to blockchain so okay a few months pass okay everybody is happy and uh and then there's a big revalry between christie and sarvis so when christie does something so this is like oh my god i'm gonna do better and like bigger and more complicated um it's it's you know it's been going on for centuries so it has been the case as well uh with uh crypto art so pac was kind of the satoshi of nfts like because we don't know who they are they never even had panels like they actually text an interpreter who actually answer for them i mean we say them because we don't know if it's collective a woman a man

and uh um pack actually so sold um the fangible collection at south beach via nifty gateway so everything was done on nifty gateway so at least okay this is great like this is a partnership with the crypto platform um the transaction is listed on chain because you buy it on nifty gateway midas or cons of like what happened there is sas biz kind of disappears in that transaction like you purchased and i purchased one like i mean it was quite a complicated project i'm not gonna explain now but you purchase some like a work by pack

on nifty gateway there is absolutely no record of sales business on chain so it's kind of like purchasing a work by pack like you know somewhere else like it doesn't really list uh such beats anywhere and if the gateway all right not the most decentralized platform so i'm not gonna get into that but again if you wanna find me after a few drinks i have a lot of things to say so um all right again a few months later we're in june um and i pass like you know so a lot more but uh bonhams actually uh presented a sale called crypto ogs the pioneers of nft art and partnered with uh super rare great it's a decentralized platform yeah okay

so it's a little better and uh one great thing that actually um like was the first time uh that um they were doing that was that the artworks were actually minted by the artist on and the artist transferred the art the to bun ham's account on super rare so you have a trace that bonhams the auction house is involved and then you're like great i'm going to beat on slippery and everything will be unchained no the beads were only accepted on bonhams and um like you know so that they could have their

buyers premium and all the fees actually accounted for and because of that the transaction is not listed unchained because what happened is that the artist minted it transferred it for you know like as a gift to bonhams and then bonhams transferred it to the winning bidder but without record of the price so and the price are not listing unchained and benhams really doesn't know the crypto art market and did not really attempt to do it so all the marketing had actually had to be done by the artists themselves on twitter and one work on that sale was from pac and it was a brilliant work that

had to change hands every 28 days otherwise it would like disappear and if you read the description of that work on bonhams there is nothing and everything was done by pac on twitter all right then july okay almost almost here we this auction house italian auction house score can be actually partnered with um um like um mokta which is museum of contemporary digital art and it's a security like group of curators of crypto art and and super rare to do like this sale called dystopian vision and so first yes they partner with the decentralized marketplace

the artworks were minted by the artist on super rare and the bees were accepted on super air yeah and they did like an awesome like opening uh in person at the auction house and also in um you know like a metaverse like in ireland uh with talks uh in a 3d environment so this was uh really great but we still have some place to improve because um there is no mention of can be online so the way that bonhams like had um the works uh in in their um super rare account did not happen but we're getting there see like there's

fewer and fewer cons of all this so uh so we're still at this point where like we're still like you know remember the slide with the boxing game we're still like yo indeed you love it like there's really no middle ground and uh and it's really two options for uh the future of like crypto like relationship with the crypto art and the traditional art market it's like toward the convergence where we can really see um like the actors work together and apply best practices from both worlds and you know we all live in la la land and everything is great i wish that but i'm not sure uh we're gonna get there or really like the other um like option is

the total fracture where like we're actually much more um you know like in innovating a lot of um like using a lot more like technology like crypto um you know like blockchain technology to um to make an alternative art market and then the art market stays um you know the way it worked for centuries so we're not sure yet but it's uh um you know there's a few funny things that like um you know like there's already like crypto already has redefined some rules of the art market and that has never been seen before and i'm not gonna get into all of these but like um the cult of edition number one

is a very new thing and if you think about it it's really like crypto um like projects and crypto people being obsessed by the genesis block and and all the you know myths around it uh make like um nft you know edition number one much more valuable than any other and before in like edition work it's like one two three four doesn't really matter it's more like the addition size that really mattered before and a better 3t's actually not intentional but quite well placed um so we're actually like inside crypto like there

um there are a lot of like um like kind of think tanks or like really discussions around how we make um like the art world better and how we actually uh define new ways to do creation via tokens like moca which is a museum crypto arts uh launched their own governance token um there's like decentralized governance dows social token uh like there's a lot of like experiments on like uh you know smorg was actually like a currency created by hakatau and some of his work actually are only available in that currency so it's quite very nascent and and very new

but it's uh it's it's very um it's fascinating to me uh and dada by for example uh data is one of the early early early social platform where you do uh discussions via drawings it's not like a marketplace and uh and they're really trying to redefine how uh artists are being paid not just because they're popular and like their work is uh is is you know very expensive but uh trying to really look at other models and auctions and then how to implement ubi for example for the art market so this is me if you have any questions

or you look like this cat don't worry there are a lot of resources so you can um i have a newsletter that i do for clients and i opened it to everybody uh on what's happening and actually lalar.io is a notion site on resources on art nfts so feel free to browse and yeah i'm funny so there's not that many fans so you can find me but thank you that's the last slide any questions so thinking about the marketplaces

you mentioned that there are uh invitation only curation and permissionless from what i've noticed the invitation and curation tend to command higher prices do you think that this creates a sort of walled garden effect and is that a good thing or should uh the permissionless aspect be promoted more um so it's it's a very interesting question because we're we're going back to what creation actually means right um i mean this is where the reason why i said like invitation only platform not curated is because this is a gatekeeping like because when your platform you have a financial interest of picking an artist that is going to bring you more revenue um so so this is why like you know like it's great it's great honor to be on

super rare etc but it's not um like curated like when um and people take curated as gatekeeping i would say like invitation only is more gatekeeping than curation because curation is supposed to be um like around the special theme or around like specific subjects or types of art meaning that like um you really have the opportunity to discover and like triage like everything that's out there with some meaning and uh but honestly we have like had for the past two months like discussions every friday with vertical crypto art uh coal born from uh mocha and a lot of other people to really

with one question like what does curation mean to you because they're very very strong feelings about it uh and and some people and in 2018 it was like the word you could not pronounce because if you were at an art and blockchain um talk and you pronounce the word curation and it was not like such a you know accepted use case at the time everybody was like we're decentralization maximalist like you can't recentralize and like ah okay um but but it's a it's a it's a real question and uh and i don't think we've cracked the code uh because uh even the smaller platforms that are like working on like specific subjects are like not really

created so that's where i'm really excited on like having like decentralized creation and like hicket nank actually this uh company called uh diverse nft uh is doing curation in a very different way where uh you each curator of like has a budget for like one week of selecting like works for like you know like 60 teslas and then define the curator of the next week and then so on and so forth so that like it's actually diverse enough and you know decentralized but any any idea welcome as well okay oh

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