Bubble or no bubble? A well-known artist weighs in on the NFT craze
Our mission to make business better is fueled by readers like you. To enjoy unlimited access to our journalism, subscribe today.
San Francisco street artist fnnch has had a breakout year. In May, he launched Honey Bear Hunt, which blanketed the city with images of his trademark bear wearing a mask. The idea—part art, part game—took off. Suddenly he found himself shipping 20,000 bears to more than 18 countries.
At the same time, fnnch (pronounced finch), noticed that other street artists like WhIsBe, Matt Gondek, Greg Mike and lushsux were raking in big bucks on the sale of their digital works. These online creations came with a digital certificate known as NFT, or non-fungible token, that records ownership and is meant to prove authenticity of unique digital assets. The main benefit is that once a sale is recorded, it can never be changed thus solving the problem of counterfeits that have plagued the art world for centuries. These tokens can also be bought, sold and traded on exchanges giving added perceived value to the works.
By March, the market for NFTs was on fire with the artist Beeple selling a collage of digital images he created over the course of 5,000 days for $69 million, more than for many Van Goghs, Monets, and Picassos. Suddenly everyone was selling everything with NFTs attached. Twitter CEO Jack Dorsey sold his first tweet. Musician Grimes sold a few pieces of video art. Basketball superstar LeBron James sold a highlight reel of his top shots — all as NFTs. With the floodgates open, a rush of creators raced onto the buzzy social audio chat service Clubhouse, where tech elites gather to share their big ideas like how to cash in on the craze.
That’s when fnnch got a call from his friend, Josh Constine, an investor in Clubhouse through his venture capital firm, SignalFire, and the host of a popular show on the platform. He was about to treat his 3.6 million Clubhouse followers to a rare conversation with Facebook CEO Mark Zuckerberg, Spotify CEO Daniel Ek, and Shopify CEO Tobias Lutke, and thought it could make for good times if fnnch created an NFT of the trio, then auctioned it off giving a portion of the proceeds to charity.
Within 25 hours, $70,000 was raised.
Bitten by the bug, fnnch decided to do it again, and is now auctioning an NFT artwork on Sunday for the charity Value Culture for a Passover celebration. The event, hosted on Clubhouse, of course, will be livestreamed on Buzzfeed’s Tasty YouTube channel with appearances by Silicon Valley heavyweight investors such as Marc Andreessen and Ben Horowitz.
In keeping with the tradition of the holiday, fnnch has created a “digital afikomen” which is a rendering of a matzoh that will be split in half with one part hidden for the audience to find and the other half auctioned off. “This is purely for fun. There is so much that can be done with the technology, we’ve only just begun to scratch the surface of all its creative uses,” he said.
But whether his art is worth 10 times as much because it’s an NFT, fnnch gave a resounding no. “I feel more confident in the value of my fine art than in this overhyped field of NFTs,” he said.
Honey Bear mural in Chicago by artist fnnch (Raymond Boyd/Getty Images)
Yet, fnnch understands the heightened interest. “When people ask what is this art worth, I tell them that if two rich people want it, then it’s worth a lot. There is no intrinsic value. They collect it because they want it.”
Holding true with the digital medium, fnnch explained: “Like stock which you cannot physically experience, there is a pleasure in simply owning certain things. In the arc of time, we will have more adequate display mechanisms, but right now many are happy just having a link to a webpage that displays their digital art. Some have even mounted screens on their walls that rotate their collection.”
Is this a bubble? Definitely, fnnch said. “You can have both — revolutionary technology and a bubble. They’re not mutually exclusive.” He then compared the rise of NTFs, and their potential fall, to the dot-com bust that led to the ascent of Amazon and Google. “This is that same moment. I see NFTs being sold by artists that don’t have much of an audience or resale market, and they’re selling for extraordinary prices,” fnnch said. “I don’t think that will last. Most of these things will be completely worthless, but it’s also going to change the way ownership is handled and authenticity decided.”
A true believer in the technology, fnnch said in time, NFTs will improve lives. Among its many benefits he sees it as a way for artists to sell works and get compensated that didn’t previously exist. “Before this, there was no market for digital art,” he said. Now many of these platforms are building in a way for artists to get a percentage of resale as their works appreciate in value. That will make all the difference.”