The Cause and Effect of NFTs

Without looking it up – how much would you guess that the first ever NFT sold for? Presently, the highest grossing NFT sale sits at the eye-watering amount of $91.8 million USD. Titled The Merge, and created by digital artist Pak, the work is a collection of NFTs which make up a collective unit. It was purchased by 28,983 individuals over a three-day span in December 2021. The initial set of buyers owned 312,686 shares of the whole, but there is no telling how many tokens have been sold since, meaning that the number of those holding the tokens may have increased, or decreased respectively. To put things into perspective, for a similar price tag you would have been able to snag up one of Claude Monet’s most famous pieces, directly from the Rockefeller collection (Nympheas en Fleur sold at Christie’s New York for $91.4million USD). 

Pak is currently the most valuable living artist, followed by Jeff Koons, whose stainless-steel Rabbit sculpture sold for $91.1million USD in 2019. Interestingly, Koons’ Rabbit was also part of a series; three identical sculptures were produced, and sold separately, but only one would bring home a record-breaking price. The Merge was sold in an open edition, which is the opposite of a limited edition, over three days. Buyers were able to select any quantity of tokens, beginning with a cost of $575 USD per unit, and increasing by $25 USD every 6 hours.

Rabbit is on display at the Museum of Contemporary Art in Chicago, where it lives as a partial donation, and is visited daily. The Merge is scattered across tens of thousands of digital wallets (which hopefully no one visits). People are still puzzled about what each individual token depicts, and experts haven’t come to a consensus as to whether the work can be considered a single piece, or whether it’s a collection of 312,686 units with much smaller values than record-breaking number achieved as a whole.

Still, are “hodlers” happy with their purchases? Probably. Investing in art of any kind is about more than the monetary gains that may or may not result from a purchase. We often forget that art collectors feel that they are buying a piece of culture frozen in time, forever representative of the generational art movements that led to the work’s inception. 

NFTs have changed the art world. You can roll your eyes, join the fun, or dig in further and find your own comfort zone somewhere in-between. We chose the latter. Let’s go back to the first ever NFT.

The answer to our question is – a whopping $4.00 USD. The first known NFT, called Quantum, was minted on May 3, 2014 and is credited to digital artists Kevin McCoy and Anil Dash. Quantum, was a short video clip of McCoy’s wife Jennifer. McCoy later minted this clip on the Namecoin blockchain and later sold it to Dash for $4.00. That was it. The big NFT bang. How did we get from $4.00 to $91.8 million? That’s the magic of popular culture. Artists from all time periods and walks of life have struggled to express and translate this magic for audiences everywhere to consume and reflect upon.

Not every NFT collection is going to make it. In fact, most won’t. However, this doesn’t discredit anything that digital artists or communities are building and creating. Whether we agree or disagree with an artwork’s valuation doesn’t really matter. In fact, diving into any individual’s opinions of NFT art will lead to an exploration of their overall values and beliefs as pertaining to art, and by extension, culture. This exercise in and of itself is worthwhile, worthy of our time and attention. It is exploratory, and progress requires exploration. 

To get to Pak’s The Merge, we needed the success of Rabbit. To get Rabbit, we needed Andy Warhol to toss his technicolor pop-art prints from the skies of New York. Warhol, in turn, needed Marcel Duchamp’s “ready-mades” to incite museum-goers with the question of what art is, and could be. Before Duchamp, we needed Edouard Manet to stand up for the once controversial avant-garde movement, and demand a new form of art exposition that was not determined by the Academy’s rigid and inhibiting standards… And so forth.

In the end, art, like beauty and sentiment, means something different to everyone. We aren’t the first generation to criticize the artistic movements sprouting up around us, and we won’t be the last. At the end of the day, “everyone’s a critic,” and no piece of art will ever be able to hold a definite and universally agreed upon consensus of value, so let’s focus on the art that we enjoy rather than tearing down pieces we don’t understand.

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