Digital art lies at the intersection of technology and creativity. For years, artists have used software, computers, or other electronic devices to generate photographs, videos, digital paintings and animations. But NFTs (non-fungible tokens) have recently driven digital art to the forefront, enabling artists to cultivate communities of collectors who champion the artists’ visions and purchase their works – often for outstanding sums of money.
Why have certain NFT art pieces become so valuable? Take a look at just four of the reasons, along with a few of the highest price works below.
1. NFTs create scarcity and authenticate ownership.
Digital artwork is often undervalued because it’s freely available online. Copying an artist’s meticulously-crafted digital creation takes a simple right-click. But NFTs have changed the paradigm.
NFTs are built on blockchain technology that provides an immutable and transparent record of ownership. The “non-fungible” aspect of an NFT means each asset is unique and therefore, scarce. Digital artwork minted as an NFT comes with proof of authenticity and ownership rights. Individuals can buy or sell NFT art pieces, or keep them in their collections, with the knowledge that the art’s value cannot be diluted by forgery or false claims.
2. NFTs reward a creator’s vision and hard work.
Regardless of a digital artist’s medium — whether film, illustration, photography, music, or written work — art pieces are the manifestation of labor and creative vision. Beauty may be in the eye of the beholder, but artwork offers value to anyone who resonates with it. Whether a piece brings joy, shock, or melancholy, or whether the piece is simply a solid investment, NFTs permit the artist to derive fair compensation for it. The NFT marketplace reflects a long past due metric of digital art’s true value.
3. NFTs create community that drives value to an artist’s work.
NFTs give artists a platform to develop a supportive community. Because NFTs enable verifiable ownership of digital assets, artists can now identify those who hold their works. They can communicate with owners directly, and they can create spaces where collectors can interact. Whether through private discord channels or IRL (in real life) meetups, the artist/ owner relationship drives stronger connection and greater value to the works.
Additionally, the NFT smart contract enables an artist to benefit from secondary sales of artwork when the protocol returns a percentage of those sales directly to the artist. Those who support artists by purchasing pieces in the secondary market may help drive prices higher to the benefit of both the artist and collector.
“Celebrity” creators – those who’ve developed a strong following prior to issuing an NFT or those whose NFT art elevated their profile — can often command high prices for their NFT projects. But even up and coming artists can draw on their smaller communities for support. Being the first to discover and promote a new artist carries significant clout. The potential for a talented, yet relatively unknown artist is unlimited when supporters champion their careers and invest in their works.
4. Utility drives value to certain NFT art pieces.
NFT technology has the ability to grant owners of artwork benefits beyond ownership of the art piece. For example, the artwork may enable the owner to participate in a virtual world or attend an online event. Likewise, the artwork may grant the owner access to an exclusive community. The artist may even provide holders with additional artwork at no cost, “airdropping” a new piece in the collector’s cryptocurrency wallet. When collectors associate worth with those additional features, the value of the NFT increases.
A few outstanding NFT sales, and where to view and buy NFT art.
Although price is not necessarily reflective of value, here’s a look at some of the more expensive NFTs sold:
The Merge — $91.8 million – Designed by an anonymous artist known as PAK, a quantity of 312,686 “mass units” — spherical objects — were sold to 28,983 buyers in a 48 hour sale. The smart contract was coded so that if a crypto wallet acquired more than one token, the tokens merged into a single NFT, the sphere growing proportionately larger, and supply decreasing over time.
Everydays: the First 5000 Days — $52.7 million – This NFT digital piece was created by Mike Winkelmann, known professionally as Beeple. The work consists of 5000 individual images, created each of 5000 days, that document Beeple’s artistic journey and create a cultural timeline.
Clock — $52.7 million – This NFT by artist Pak depicts a timer, which counts the number of days WikiLeaks founder, Julian Assange, has spent in prison. It was purchased by AssangeDAO — an organization that supports the fight for Assange’s freedom.
CryptoPunk #5822 — $23.7m – CryptoPunks are collection of images launched by Larva Labs studio, a two-person team consisting of Canadian software developers Matt Hall and John Watkinson. The NFT project served as an inspiration for the ERC-721 standard for NFTs and the modern crypto art movement. The rarity of traits of Punk #5822, including Alien skin and a bandana, has contributed to its high price.
Right Click and Save this Guy — $7.1 million - This piece by artist XCOPY is a critique of those who do not believe in the value of NFT artwork. It was purchased by Cozomo de’ Medici, the name rapper Snoop Dogg uses as an NFT collector.
Unique NFT art can be viewed and purchased on several platforms, including Rarible, SuperRare, Nifty Gateway, Foundation, Obkt, Zora and others. Those marketplaces are built on various blockchains and offer artwork in a broad range of styles and with a broad range of prices. Artwork can also be viewed on secondary marketplaces.
Not every piece of NFT artwork sells for millions or even hundreds of dollars. It’s entirely possible for the smaller investor to acquire quality photography, digital creations, video pieces and music, supporting creators in their artistic passions.