Non-fungible tokens (NFTs) have taken the art world by storm in recent years. NFT art explained has transformed how art is created, sold and collected. But what exactly are NFTs and how are they changing art? This comprehensive guide explains everything you need to know about NFT art explained.
What are NFTs?
NFT stands for non-fungible token. Unlike cryptocurrencies like Bitcoin or Ethereum, NFTs are non-fungible. This means they cannot be replaced or exchanged for something else. Each NFT is unique and acts as a collector’s item that cannot be duplicated.
NFTs are digital assets that represent ownership of a unique physical or digital item, such as a work of art, music, video clips, collectibles, etc. NFT art allows digital art to be tokenized and sold just like physical artworks.
NFTs are minted on a blockchain, which gives them their uniqueness and acts as a public ledger to record their transactions. Common blockchain networks used for NFT art explained include Ethereum, Tezos, Flow, etc.
How do NFTs work in art?
Here is a quick overview of how NFT art works:
- An artist creates a digital artwork and mints it into an NFT on a blockchain.
- The artwork can be in any digital format such as JPG, GIF, MP4, 3D model, etc.
- Minting converts the artwork into a non-fungible token that is unique and cannot be replaced or duplicated.
- The NFT is listed for sale on a marketplace like OpenSea, Rarible, SuperRare, etc.
- Buyers purchase the NFT using cryptocurrency.
- The buyer receives proof of ownership recorded on the blockchain when the sale is made.
- The NFT acts as a certificate of authenticity and ownership of the underlying artwork.
- The artist can set royalties so they earn a percentage each time the NFT is sold to a new owner.
Why are NFTs important for artists?
NFT art represents an exciting new opportunity for artists for several key reasons:
- It allows artists to sell their work globally without boundaries.
- Digital art can be sold just like physical art using NFTs.
- Direct sales to collectors without galleries/agents. Artists earn more from primary sales.
- Programmable NFTs can automatically pay artists royalty each time their works are sold.
- Provides scarcity and authenticity for digital artworks.
- Lets artists connect directly with fans and collectors.
- Verifiable provenance preserves artwork history on blockchain.
- Artists retain control and ownership rights over their creations.
- NFT art explained widens the collectible art market beyond physical works.
Top NFT art sales
Some of the highest selling NFT artworks include:
|Everydays: The First 5000 Days||Beeple||$69.3 million|
|CryptoPunk #7523||Larva Labs||$11.8 million|
|The Merge||Pak||$91.8 million|
|Human One||Beeple||$28.9 million|
|Ringers #109||Art Blocks||$6.9 million|
As the list shows, NFT art explained sales have already broken massive records, even surpassing prices of some established physical artists. High profile sales have increased mainstream adoption of crypto art and NFTs.
How to buy NFT art
Buying NFT art may seem complex initially but gets easier with some basic knowledge. Here are the key steps:
- Set up a cryptocurrency wallet compatible with the blockchain network you want (Ethereum, Tezos etc). MetaMask and Coinbase Wallet are popular choices.
- Fund your wallet by purchasing cryptocurrency like ETH from an exchange. Popular options are Coinbase, Kraken, Binance.
- Browse NFT art marketplaces like OpenSea, Rarible, SuperRare etc. and pick a work you want.
- Connect your crypto wallet to the marketplace.
- Submit a bid or buy it instantly at the listed price in cryptocurrency.
- Complete purchase to transfer ownership to your wallet address.
- The NFT art will show in your wallet, proving ownership.
- Use your wallet to view, showcase or re-sell the NFT. Royalties go to the artist.
Storing and displaying NFT art
Since NFT art is digital, it requires a bit different handling than physical art:
- The artwork file itself is not stored in the NFT. It resides elsewhere online.
- The NFT just contains the token metadata, proof of ownership and a URL link to the art.
- Wallets like MetaMask allow you to view your NFT art-explained holdings and metadata.
- For display, store images on a decentralized file storage like IPFS or Arweave.
- Display your NFT art-explained collection in a digital wallet or virtual gallery like Spatial, Cryptovoxels.
- Certain platforms like Nintendo Switch allow you to use NFT art as avatar icons.
- Digital art frames like Meural allow you to showcase NFT art on a TV/monitor.
Is NFT art a good investment?
Like any new technology, NFT art comes with both hype and skepticism making it hard to predict growth. There are compelling cases on both sides:
For NFT art investment:
- NFT art is seeing massive growth and adoption from traditional artists.
- Major auction houses like Christie’s and Sotheby’s now sell NFT art.
- Limited supply and scarcity give crypto art collectible appeal.
- Verifiable provenance preserves artwork history and value.
- Convenient trading and ability to resell work globally.
- Direct artist engagement and social aspects may drive value.
Against NFT art investment:
- Digital art has no physical tangible value. NFT just provides ownership rights.
- Potential for overinflated prices and bubble-like volatility.
- Lack of regulation in the market with high risk.
- No guarantee of liquidity or ability to resell easily.
- Potential for fraud, fakes, intellectual property theft on NFT art platforms.
- Displaying and storing NFT art comes with challenges.
Like any investment, proper research and caution is advised before buying NFT art. Analyze factors like artist reputation, artwork uniqueness, current sales activity and past price history to make informed decisions.
The future of NFT art
NFT art innovation is still in early stages and expected to see massive growth as the technology matures. Some future trends include:
- Established mainstream artists adopting NFT art more. Celebrity NFT drops generating huge buzz.
- Art NFT platforms adding more metrics like transparent pricing data, provenance tracking.
- Augmented reality and virtual world applications for digital art display and collaboration.
- NFT art marketplaces improving curation and discovery with AI, machine learning.
- Fractionalized NFT ownership allows buying small shares in big-ticket artworks.
- Interoperability protocols connecting different NFT blockchain networks.
- Environment-friendly energy-efficient NFT platforms using proof-of-stake.
- NFT art slowly entering offline world with exhibitions, conferences, auction houses.
While the future is uncertain, NFT art represents a seismic shift in how art is created, owned, traded and displayed. This technology has opened new possibilities for artists to explore digital ownership, engage with collectors, and tap into global crypto-savvy audiences. As the space matures, NFT art promises to transform art in ways we can only imagine.