Should museums get into NFTs?

Excerpt from the November 2021 issue of Apollo. Preview and subscribe here.

The British Museum is one of the leading museums selling non-fungible tokens (NFTs) of works in their collection. But what are institutions really selling – and do they understand what serious buyers want?

Bernadine Brocker Wieder

For those following some of the coverage of the digital art market and the non-fungible token (NFT) boom, it’s tempting to say that museums should have nothing to do with what appears to be a fad or a bubble. This view ignores what NFTs really are and what they mean to serious collectors – and how much that has in common with the idea of ​​the museum itself.

If you talk to the biggest crypto collectors about what they would like to do with their NFTs, the word they use – and they hear it as a verb – is “hodl”. It derives from ‘HODL’, an acronym that stands for ‘hold on for dear life’. Over the past five years, crypto investors have held onto their assets despite the volatility and speculation surrounding them. On forums like Reddit or Twitter, they advise each other to stay calm and hodl. Of the Bitcoins available for purchase today, 79% are held by long-term investors who view them as “digital gold,” with only 21% held and traded by speculators.

Since 2013 (but mainly in the last two years thanks to standardization and technological advances), cryptocurrency holders have found an alternative focus for their long-term investment strategy: the digital creative economy. Their holdings (which have sometimes increased in value 1,000 times when converted into fiat currencies) are now making their way into supporting metaverse artists, creatives and real estate: the “long term” that resonates with this culture.

Despite the existence of a generational divide and a lack of a common language, hodling has much in common with the traditional mindset of museums and collectors. Institutions preserve cultural assets through pandemics, speculation in the art market, shady deals, popular disinterest, and even civic upheaval. And museums, on the whole, reject calls for alienation even in the darkest of times, believing that the long-term value of their holdings to humanity outweighs any short-term gain.

When an NFT from Beeple that was stored on the Ethereum blockchain sold for $69 million at Christie’s in early 2021, the world took notice. But when the buyer, Metakovan, talks about what he wants to do with Daily: first 5,000 days, rather than selling it for profit, he plans to collaborate with the artist to create a virtual museum that the public can access through virtual tickets. For Metakovan, these 13 years of doodles are priceless – representing an era.

Like it or not, history is often shaped by the artifacts and opinions enjoyed by the masses. The subject matter of Beeple’s works may not resemble the offerings of an evening sale of post-war and contemporary art – rather evoking the populist, satirical and controversial commentary of, say, Jan Steen, Honoré Daumier or William Hogarth .

Museums will no doubt have to deal with NFTs to some extent, even just in the form of donations (as was the case with ICA Miami and the donation of CryptoPunk 5293 of one of its directors). Some like to jump to the conclusion that museums are sitting on a treasure trove of “NFT-enabled” digital assets due to their vast collections of art, culture, pop and design.

At Vastari’s [an online platform that connects private collectors with public museums], we have noticed that the institutions we work with are challenging decades of free content delivery on the internet. Monetization using blockchains and NFTs, when done well, allows the circulation of the asset while generating revenue from it. Funds have already been raised for the Uffizi, the Hermitage, the Whitworth (a project Vastari was involved in) and the British Museum, with more projects no doubt to come soon.

But I emphasize that if these museums do not clearly define their internal attitude towards digital assets, observers will easily jump to the conclusion that they are selling the high-priced equivalent of a collectible memento of low value, even a fractional part of the original object. So what is the long-term benefit for the holders of these tokens?

For museums looking to get involved in this technology, it is indeed not advisable to simply dabble in the minting and selling of JPEGs. Instead, they should master an authentic voice and business model — and understand the deft conjuration of transparency, timestamping, FOMO (fear of missing out), community, and creativity that drives this new wave of technology.

Bernadine Bröcker Wieder is the founder and CEO of Vastari and Vastari Labs.

Douglas McCarthy

When the British Museum recently announced plans to sell NFTs of Hokusai prints, many seemed surprised, intrigued or somewhat perplexed. “Museum Twitter” lit up with heated threads, heated discussions and sarcastic memes. The British Museum, however, is not the only venerable institution to enter this fashionable field. This year, the Hermitage Museum, Uffizi Galleries and Whitworth Art Gallery also sold NFTs based on their collections.

In May, after the Uffizi sold an NFT by Michelangelo Doni Tondo for $170,000, its manager Eike Schmidt said, “It’s not a change in direction in terms of revenue, it’s additional revenue.” In July, the Hermitage reportedly fetched $440,500 from NFT’s auction of five masterpieces by Giorgione, Leonardo, Kandinsky, Monet and Van Gogh. Museum director Mikhail Piotrovsky said the auction was “an important step in developing the relationship between person and money, person and thing.”

At first glance, these companies seem to encapsulate the ethical tension between museums, on the one hand, democratizing access to their collections and, on the other hand, financializing them as assets in NFT markets. Take a moment to think, however, and you might conclude that they are very much in line with normal museum practice. To understand why, we have to take a little detour through copyright.

Like many museums around the world, the British Museum, to take just one example, uses copyright to limit the reuse of its digital collections. It claims new copyrights when it creates digital facsimiles of public domain works in its collections – works for which copyright no longer exists, or never existed in the first place. – just like the Hokusai prints from which the museum is now minting NFTs. Are these digital facsimiles really protected by copyright? The relevant legislation is complex and lacks international harmonization.

Claiming copyright over these digital surrogates allows museums to erect a legal scaffold on which restrictive reuse policies can be built. It enables their attempts (vain though they are in practice) to monopolize the supply, publication and monetization of digital collections. The provision of images and the cost of reproduction can be extremely expensive, and the negative effects of these restrictive policies on authors and scholars – especially those working in image-oriented research areas such as the history of art – are well known.

According to the website of LaCollection, the British Museum’s trading partner, “Each NFT is associated with a certificate of authenticity, signed by the art institution owning the original work”. This statement will raise the eyebrows of many art historians. The big wave was Hokusai’s first series print Thirty-six Views of Mount Fuji (Fugaku sanjurokkei), of which approximately 5,000 copies were printed. It has since become one of the most reproduced and well-known images in the world. So, the idea of ​​buying a “super rare” edition token from the Hokusai print is rather odd.

To market limited edition NFTs of public domain works is to manufacture rarity where there is none. Impressions of The big wave are held in museum collections around the world and many of these institutions offer high-resolution digital files of The big wave freely available for download and unlimited reuse by anyone, anywhere – no strings attached.

The massive power consumption of Proof of Work (PoW) blockchains, currently used as the basis for cryptocurrencies such as Bitcoin – and currently Ethereum, on which most NFTs are based, deepens the ethical conundrum of museums , going against their statement. intention to reduce their carbon footprint.

In 19th century Japan, the right to manufacture and distribute printed works was called Zohan (possession of blocks). Museums selling NFTs from their collections today have unwittingly revived Zohan on 21st century blockchains. The price of a Hokusai print in 1842 was set at 16 mon, about the cost of two servings of noodles. At the time of this writing, bidding on the first NFT of The big wave exceeded £6,000. If Hokusai were alive today, he would surely be amazed.

Douglas McCarthy is co-editor of Open GLAM Medium and Head of Collections Engagement at Europeana.

Excerpt from the November 2021 issue of Apollo. Preview and subscribe here.

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