Blockchain Technology is steadily finding its way to every sector in today’s world. The banking, real estate, education, the government and healthcare industry already bank on Blockchain technology for efficiency, transparency and security. With Blockchain technology and its easier logistics management, the art market is highly inclined towards incorporating it to allow buying and selling of art online. Because of cryptography, this industry worth $63.7bn in 2017 is assured to have safe and secure online transactions. The art industry is going to open up to a wider audience since the trade is going to be taking place on a much larger scale. The right to trade and ownership of art is going to be clearly established with due respect to transparency offered by Blockchain Technology.
According to a recent report made by the Fine Arts Expert Institute, at least half of the art examined has proved to be fake or credited to the wrong artist. Traditional, outdated paper-based systems, trust and single-authoritative bodies do not seem to be reducing the cases of art fraud. Introduction of Blockchain technology in the art market will help to tackle this major issue as it can offer:
• A piece’s history from initial authentication to present ownership. • Blockchain-based digital certificates for artworks and collectables. • Digital Artists to control where and how their work is seen, copied and distributed. • Digital Artists to license their work and receive royalties for reuse.
Sure, creating Blockchain based digital certificates for art pieces across the world is going to be a slow process, but this would bring in more numbers of buyers and sellers as guarantee of originality is highly appreciated.
Being able to use art as collateral against loans is a far-reaching benefit that the Alan Turing Institute and DACS campaigns for. Due to the illiquidity in the market and not being able to realize the correct value of art, banks often hesitate before lending money to collectors against the value of the artwork they possess. Moreover, banks do not have any guarantee that anyone else is going to buy that artwork from them and this terminates the process of lending loans to these collectors. Blockchain retorts to this as an increase in buying and selling of certificated art will liquidize the market.
Currently, only 5% of the $500bn Blockchain Industry is concentrated on the Art Market. In 2018, a Blockchain-focused Art + Tech Summit ran by Vastari, a London based museum consultancy along with Christie’s. In the same year, the world’s first ever cryptocurrency art auction took place using Maecenas platform and during this, buyers were offered to own a fraction of Andy Warhol’s 14 small electric chairs, valued at a whooping $4.2m. The progressive nature of Blockchain Technology and Cryptocurrencyis a giant treasure box and the Art Market is aiming to seize a few jewels.