Sotheby’s launched its first NFT auction in October this year, achieving a total sale of $ 18.6 million (£ 13.95 million). Sotheby’s co-head of digital art, Michael Bouhanna, told Express.co.uk: “We realized the importance of technology and how it enables digital artists to finally market and sell their works. ” He now believes the auction house has a role to play in bridging the gap between the traditional art market and NFTs. With the launch of its Metaverse, a platform dedicated to digital art collectors, Sotheby’s has become the first auction house to create a personalized NFT marketplace.
Meaning non-fungible token, NFTs are files that have a digital ownership certificate.
This is stored on the blockchain, the same technology behind cryptocurrencies, which means it cannot be tampered with.
NFTs have drawn attention for some of the incredible sale prices they have achieved.
An NFT CryptoPunk for example sold for $ 11.4million (£ 8.58million) at Sotheby’s while Sir Tim Berners-Lee’s World Wide Web source code sold for $ 5. $ 4million (£ 4.06million).
Mr. Bouhanna explained that there are many factors that Sotheby’s takes into account when valuing an NFT.
“The aesthetic is important, the concept, the idea because with blockchain technology it can become very conceptual.”
He added: “The community behind an artist or behind a project is very important.”
“It happens mostly on social media so that we can smell the market and know the top selling artists by being immersed in the community via Twitter for example and follow and see all those collectors, what they buy.
“So it’s a good way to follow the market the same way we would follow auctions in our traditional business.”
It is also essential to know which artists are influential in various movements.
Like other art forms, NFTs have seen particular trends and movements emerge.
NFT avatars which take the form of headshot style portraits of various characters have been a dominant trend with CryptoPunks and Bored Ape Yacht Club being popular collections.
Mr Bouhanna explained that CryptoPunks consists of 10,000 uniquely generated avatars with prices ranging from £ 300 to £ 10-15million.
Older art movements also found an outlet in NFTs, but with the generative movement, which dates back to the 1960s, finding a revival.
The generative movement uses autonomous systems to create art, often relying on computers.
The rise of NFTs now gives generative artists a way to sell their art in its native form rather than having it printed.
Sotheby’s has even found NFTs to match many of its existing clients.
In their first creative sale, 30% of bidders and buyers were existing customers, many of whom were buying their first NFTs.
Mr Bohanna suggested that some customers were more confident buying from an auction house than from NFT markets.
“It is a long-term goal to integrate all the traditional customers who have expressed their interest,” he explained.
While more traditional art has seen fraudsters attempting to pass off fakes, many believe that NFTs are actually more secure with technology capable of verifying the originality of the work.
Mr Bouhanna explained, “You can verify that the smart contract address of an NFT is one of those issued by the artist and nothing can roughly simulate that.”
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This means that even if an NFT were copied, it would be possible to say that it was from another artist.
Unlike a painting, Mr Bouhanna said: “There is no way to copy the signature.”
While NFTs grabbed the headlines for their incredible selling prices, Mr. Bouhanna explained that there was a large market and a wide range.
He added: “We will be looking to include NFTs at lower prices to make people more inclusive and welcome more of this NFT audience to buy from Sotheby’s.”
By 2022, he predicted that the generative movement would continue to dominate and also hoped to see more female digital artists enter the market.
He concluded: “There are some very talented artists, like everywhere in the world, who are already important and collected by some of the biggest collectors but not necessarily have the limelight that they deserve.
“Next year, I hope we will see more female artists in the top 10 NFT artists.”