Virtual Art and Non-fungible Tokens
66 Pages Posted: 12 Apr 2021 Last revised: 31 May 2022
Date Written: April 11, 2021
Fueled in part by the wealth recently created from digital currencies, major art dealers such as Christie’s and Sotheby’s have embraced the sale of non-fungible tokens attached to unique digital works of art. What are non-fungible tokens, how is this related to the blockchain and what do we know about this ancient market for digital art? It now appears that digital art can be added to the growing list of uses for blockchain technology now becoming a part of modern life.
This article proceeds in seven parts. First, is a discussion about the new and explosive market for digital art. Second, I explore the evolution of the digital world and virtual property. Third, is an explanation and historical account of the blockchain and virtual currencies. Fourth, non-fungible tokens are discussed. Fifth, is a brief look at unresolved issues impacting the law of NFTs and potential solutions are provided. Sixth, a few thoughts about the future of digital property are presented. And last, I conclude.
This dramatic extension of blockchain and other digital technology to the world of art and music represents a new and exciting platform for creative expression. This paper is a valuable addition to the literature by providing a readable introduction and overview of what is now known about the likely impact of blockchain technology and non-fungible tokens to music and art. This important development should have a significant impact on the future of innovation and property law.
Keywords: art, Beeple, bitcoin, blockchain, Christie’s, collectibles, copyright, crypto asset, cryptocurrencies, digital art, ethereum, music business and publishing, nonfungible tokens (NFTs), online payment systems, property, Second Life, Sotheby’s, synthetic worlds, virtual property, virtual real estate
JEL Classification: G14, G12, K11, K12
Suggested Citation: Suggested Citation