How are NFTs disrupting the art market? Beeple’s Everydays and CrytoPunk collectibles made millions at auction while Bored Ape Yacht Club drew celebs including Justin Bieber and Snoop Dogg

May 9 , 2022

Everydays: The First 5,000 Days, a digital work by the artist Beeple, sold for millions and began an NFT-led, blockchain-driven revolution in the global art market. Photo: Beeple

Sales of NFT art and collectibles are booming on Ethereum, Flow and Ronin with Christie’s hosting its first blockchain auction on NFT platform OpenSea

Meanwhile, LaCollection partnered with The British Museum in NFT sales of well-known works by William Turner and Hokusai’s The Great Wave off Kanagawa

The world was shocked when, in March 2021, American digital artist Beeple sold his Everydays: The First 5000 Days at a Christie’s auction for an astronomical US$69.4 million. The sum, and the fact it was the first piece of NFT art to be auctioned by a major auction house, rattled not only the traditional art industry, but also questioned the way we all collect and consume digital assets.

Staff at the first Digital Art Fair Asia (DAFA) in Hong Kong in 2021 take photos of Refik Anadol’s NFT Collection. Photo: SCMP

An NFT – or non-fungible token – is an irreplaceable unit of data that’s verified on the blockchain. In an art context, this may point to either a real-life or purely digital piece, and has been touted as a solution to a perpetual challenge in that traditional scene: proof of provenance.

Three months after Everydays made headlines, Sotheby’s brought in US$11.8 million for a CryptoPunk collectible – the first profile picture (PFP) NFT series, minted in 2017 with each having a distinguishing characteristic. The one under the hammer – #7523 – was the only Punk wearing a surgical mask.

Perhaps laughably inconsequential by traditional standards, NFT collectibles spice up their offer with high liquidity, real-life giveaways plus games and utilities that tap into our sense of community. PFP project Bored Ape Yacht Club, for instance, has enjoyed a cult following from celebrities including Justin Bieber and Snoop Dogg thanks to its exclusive access to virtual and real-life events, metaverse land and more.

Yuga Labs’ Bored Ape Yacht Club 8817. Photo: Yuga Labs

According to “The Art Market 2022” report, combined sales of all NFT art and collectibles on the Ethereum, Flow and Ronin blockchains have grown from US$4.6 million in 2019 to US$11.1 billion in 2021. Compare those numbers with the global art market of US$65.1 billion and it is clear that the growth has been supercharged: the value of art-related NFTs alone – defined in the report as work made by artists or by generative art algorithms under 10,000 pieces – expanded a hundredfold year-on-year, reaching US$2.6 billion.

While NFTs undoubtedly leveraged the bricks-and-mortar strategy of legacy auction houses a year ago, the NFT art landscape has been magnified by digital marketplaces springing up alongside traditional art players as the new genre catches imaginations. However, with crypto art still finding its footing in such a novel space, it’s also struggling to make good on the fanfare and differentiate itself from the more speculative collectibles.

Dr Clare McAndrew, founder of consulting firm Arts Economics and author of “The Art Market 2022”, said the definition of art has long been expanding, along with collectors’ portfolios.

Atsuko Tanaka’s Untitled from 1974. Photo: Nukaga Gallery

“We’ve had this debate all through the years as to what you can call art,” she said. “This murkiness is not confined to NFTs: let’s take a vintage handbag, is that antique or design? I’m optimistic that things have a place in art history and these will stand the test of time.”