Ilaria (21), a communications and media student, enjoys illustrating and has loved Marvel comics, known to many famous superheroes, from an early age. For a long time, she dreamed of owning a real first edition of one of the 1950s comics. Comics from that time are collectibles and cost a lot of money. But the editions she now has in mind do not consist of yellowed paper as one might expect, but of pixels. Such an edition exists as NFT, an image that is associated with a unique code and thus can be assigned a certain value. That code is on blockchain, a kind of database in which all transactions in the world can be stored.
‘New art form’
Ilaria is not the only student at Erasmus University who is preoccupied with these so-called NFTs. In November, the first NFT event on the Woudestein campus was hosted by the Erasmus Tech Community, a group of students involved in all kinds of new technologies. About forty enthusiastic students came to Theil Building to hear what a start-up company could teach them about the ‘new art form’, she says. There was also a quiz with questions that tested how much the participants already knew about NFTs. The winners received an NFT specially made for the occasion.
The number of students investing in NFTs seems to be growing, Ilaria believes: “I never really heard about it last year, but now I hear a lot of fellow students about it.”
The reasons why students buy NFTs are the same. Usually the work appeals to them as a work of art can appeal to its admirer. Economics student Sandra (22), who was also present at the event, bought an NFT with her boyfriend a year ago. The work is created by artist Jack Butcher, better known as ‘Visualize Value’. It is an image with a black and white framed plot diagram with different categories on it. Attached is the following comment in English: “You probably fall into one of these categories: 1. What is an NFT? 2. NFTs are nonsense, 3. NFTs are a groundbreaking technology. “
For student Leon (23), who is pursuing a master’s degree in Strategic Entrepreneurship, it is mainly the Japanese anime style and the clear colors of the artist’s Dazed Ducks work that appeal to him. Both students also mention that NFTs support artists at a time when their business was doing poorly due to the corona crisis.
‘No longer just for nerds’
In 2021, NFT suddenly appeared everywhere in the media. Movie stars dealt with it, and success stories abounded about obscure works that rose in price by hundreds of thousands of dollars in a matter of days. But those stories are no longer the case. Now the NFT is reaching out to the general public.
Lemar Bachtiar (24) has just graduated in finance law. He has been investing in bitcoin since 2017 and became interested in the logic behind the digital currency. Lemar: ‘That logic is the idea of a decentralized monetary union, a value system that exists without a central bank. And with the advent of NFTs, I was able to combine that interest with my love of art. ‘ Together with the newly trained cyber security specialist Tat Luat Nguyen (23) and commercial data analyst Wouter Kloosterman (27), he founded the start-up Authic. Bachtiar’s former classmate Laurens Groothuis (25) now works there as relationship manager. The online marketplace is now recruiting artists and officially opens in April. With the company, he wants to make NFTs more accessible. “It should be a kind of bol.com for NFTs.”
The boys hope to become the largest provider in the Benelux, and just like at bol.com, customers at Authic can simply pay in euros via Ideal. The goal is clear, he continues: “NFTs are no longer just for nerds, and we want to answer that.”
hope of profit
It is striking that EUR students, although they strongly believe in the potential of NFTs and blockchain, have not yet started investing in droves.
Sandra: “Even though my friend is a big crypto nerd, we do not yet invest or speculate with NFTs. We have only one work of art and it has hardly increased in value over a year. Incidentally, it seems that people who make many NFT transactions are often still risk investors. Although I’m in favor of investing in ideas with future potential and buying art that I value, I prefer not to meddle in meaningless speculation that often turns into scams. “
Leon invests and is in a chat group where investors ‘hope for profit’. But he qualifies: “I come from the island of Antigua, and so do most people in the app group. NFTs are already more circulating there. In the chat group, we discuss a lot about when to buy and sell something. But the profit can be higher, usually it is now around five hundred euros per NFT. “
A version of the great illustration that Erasmus Magazineillustrator Esther Dijkstra made for this article will be offered from April via the Authic platform. Since the technology is fairly new, editors would like to see what happens to an NFT the longer it is offered. After six months, we take stock and write a piece about the process.
Revolution in art?
Does the move to the wider public also mean that the art market will change completely? Professor Filip Vermeylen (ESHCC) is skeptical about this. He specializes in the international art market. He says: “The technology behind NFT is revolutionary. Because a unique code is associated with a work of art, the trade in digital art becomes much more transparent, less prone to fraud, and it is easier to register ownership of digital art. It was obviously unthinkable with a jpeg file. Nobody saw any value in it because you could copy it indefinitely. “
Still, Vermeylen does not believe that the advent of digital art will displace interest in other art. He continues: “The reason I think so is because I recently attended a lecture by a digital art specialist from Sotheby’s who talked about how the well-known auction house attracts new buyers by organizing NFT auctions, but also attracts them to traditional art auctions. . Last year, the auction house arranged nine NFT auctions, where a total of DKK 199 million was bid. Of the candidates, 78 percent bid for a Sotheby’s auction for the first time, and the average age was ten years younger. The large auction houses therefore see NFT as a way to attract a new generation of art buyers, not as a replacement for the existing art market. Museums like the British Museum have also started converting parts of their collection into NFTs to interest a younger audience. †
That does not surprise him. “I am currently writing a book on the development of the international art market over the centuries, and you can see that not every innovation necessarily means that the old disappears. The trade in portraits thus continued to coexist with the trade in landscapes. My expectation is that digital art will continue to coexist with traditional art, and that one will not replace the other, but rather accompany the old. ”
How much an NFT is worth is determined by a form of scarcity that is somewhat similar to how scarcity works with Pokémon cards. In that game, a Pidgey, a Pokémon that looks like a little sparrow, is much more common than a Charizard, a Pokémon that looks like a dragon. As a result, Charizard cards are more valued in the Pokémon community. Vermeylen explains: “It is mainly such gadgets that have a value within a particular group of contemporaries or players of a particular game. The rules for determining that value differ from group to group. “
Still, the value retention of digital art at the moment is not comparable to traditional art, the expert says. “The lasting value of art is usually determined by whether the artist is part of the accepted canon of more well-known names. Once that ball rolls, it creates its own value. The reason why Vermeer is generally considered a great artist and that his works are very valuable is related not only to his special painting technique, but primarily because so many people think that his work is good and important to society. It’s the same with Banksy. His work has value for a large group of people, so everything he creates automatically has value. This is how it works with NFTs. The moment an NFT-Vermeer or NFT-Banksy arrives, his or her work will be worthless. “
The growth in the NFT market was met with much criticism in the past year. The biggest criticism is that scammers are making NFTs more popular than they are selling them to each other. As a result, products become more economical and prices rise. After that price increase, they resell the NFT to people who know nothing about it.
These dangers are common with the most popular NFT marketplace opensea.io. This is a site where thousands of NFTs are posted by everyone every day, and at the same time contains a small number of images that now have a market value of hundreds of thousands of euros.
Lemar says he is aware of this criticism: “Before we deal with artists, we want to know exactly what they are doing and what quality the work has.”
In addition to the critique of building value, experts see many security risks. NFTs can contain errors and cause data leaks.
Unfortunately, Ilaria did not win the quiz at the NFT event in the Theil building. The winner got something very special. A prize awarded in memory of the event. In all, three were forgiven. One of the prizes was an NFT with pixel art of the Polak building. Business economics student Victor (19) made this one especially for the occasion. He proudly says, “He is unique.” It’s probably the first image of campus to be immortalized on the blockchain.