The ‘mainstreamification’ of NFTs initially gained traction in the art world, addressing the industry’s inherent problems and presenting a use case that was relatively easy for the average consumer to grasp. Since then, new trends have emerged, shaping the face of NFT art today and impacting its future trajectory. Notably, the recent popularity of Bitcoin NFTs and open edition collections demonstrates that artists, collectors and the art community still value NFTs, despite the criticism these assets have faced since their rise to prominence.
An industry marred by tradition and middlemen
The art world is notoriously challenging to break into, particularly for artists without connections or the financial resources required to attend prestigious art schools. The industry is known to be ruled by gatekeepers — leaders of major galleries, museums and auction houses — who ultimately decide what qualifies as high-end art and which artists deserve the most attention.
Assuming artists can overcome these initial obstacles, they then face a new set of challenges and frustrations. Galleries and auction houses take a sizable percentage of their revenue in the form of commissions, leaving artists with minimal profit from their work. The extreme opacity of the art world also means that there is little transparency in pricing and sales conducted by third parties. In other words, despite being the reason for a work of art’s very existence, artists have very little control over pricing, sales and profit.
The traditional art world hasn’t only been unfair towards artists. Many aspiring collectors have found themselves struggling to enter the market, mainly due to high price tags attached to artwork and limited access.
The promise of NFTs
NFTs have democratized access to the art world in unprecedented ways, unlocking new opportunities for artists who might otherwise not have been able to make a living from their passions. NFTs eliminate the middlemen and the obfuscation they create around transactions. This freedom and transparency enables creators to sell directly to interested buyers, generate a larger profit from their work and access or verify all transaction data indefinitely.
Anyone, anywhere in the world can create and sell an NFT, building a community of fans and collectors who appreciate their work. Collectors can more easily enter the market as well. They have better visibility as to which artists are out there, and they can directly buy these artists’ works without the added fees imposed by third-party sellers. Additionally, through fractional NFTs, collectors can invest in portions of works without having to purchase them entirely on their own.
NFTs come with their own set of challenges
Every novel technology comes with friction, and NFTs are no exception. NFTs have faced criticism on multiple fronts, including the absence of regulation, susceptibility to fraud, inadequate copyright protection and the challenges involved in generating smart contracts for the NFTs. In addition, the controversy over the enforcement of artist royalties on NFT marketplaces, a critical source of income for creators, has intensified the debate.
Fortunately, there are either existing solutions or developments underway to create a more seamless user experience while addressing security concerns. As evidenced by OpenSea’s efforts to retain users and compete with rivals, marketplaces will continue their competition for users, necessitating the enforcement of royalties or provision of other long-term benefits to artists.
The NFT art community might look different, but it’s very much alive
NFT art has evolved significantly since its inception. While the NFT space was previously flooded with low-quality projects created by individuals seeking to make quick profits, the market’s maturation and adjustments have weeded out some of the opportunistic and fraudulent actors. The truly passionate and talented creators and collectors remain, resulting in a smaller but stronger market.
The current Bitcoin and open edition NFT trends are also opening up new avenues for artists to showcase and sell their work to diverse audiences. The former enables artists to tap into the Bitcoin ecosystem, while the latter unlocks a greater number of potential buyers by removing the cap on the number of artworks that can be minted as part of a collection.
While critics once perceived NFTs as taking over the art world and replacing traditional, physical art, the reality is that NFTs provide a new medium for artistic expression and career development. It’s time for the world to recognize that NFTs have found a permanent home in the art market, not as a replacement, but as a complement to the existing art landscape. As the technology continues to mature and the community grows, we can expect even more innovation and artistic exploration, fueled by the passion of artists and collectors who embrace the potential of NFTs.
Anthony Georgiades is the co-founder of Pastel Network.
This article was published through Cointelegraph Innovation Circle, a vetted organization of senior executives and experts in the blockchain technology industry who are building the future through the power of connections, collaboration and thought leadership. Opinions expressed do not necessarily reflect those of Cointelegraph.