Non-Fungible Tokens (NFTs): Empowering creatives — by Dr. Sidney Chan, Division of Arts and Languages
Since an out-of-the-ordinary auction held by Christie’s in 2021, “NFTs” became a very popular topic and started to permeate culture. The auction was unprecedented because it was an eight-figure sale for a purely digital artwork that was sold as a non-fungible token (NFT). It means that someone spent fortune on an intangible image that lives entirely in the digital world.
The Deprived Artist
Before NFTs, the internet environment could not establish any ownership of information and that was not friendly to creatives who then had to rely on intermediaries to monetise their works. What we know about the internet is that it is a technology for sharing information easily between people. The act of sharing also makes information easy to copy. Traditionally speaking, internet is a global copy machine that does not create scarcity or guarantee any ownership of information. Because of that, it is extremely difficult to distinguish the “owner” of a digital creation from someone who made a copy to circulate online or saved a copy to their computer desktop. The ownership of a digital work is impossible to be verified and digital scarcity is difficult to be created. Therefore, creators lose control over their digital works and cannot make profit from them. As a result, huge corporate middlemen arise which provide various platforms for verifying, selling and buying digital goods, e.g. iTunes, Spotify for music, Netflix for TV dramas and movies. On the surface, these corporate middlemen, distribution platforms seem to help artists to monetise their digital creations. Indeed, they represent a central point of authority, or a central platform which have all of the power and all of the say over decisions, like the monetary value of a piece of creative work. The artists still suffer. ‘Power is everywhere; not because it embraces everything, but because it comes from everywhere’ (Foucault, 1976a, p. 93). The exercise of power can be manifested in different forms of knowledge in different disciplines of professions. Each discipline, like the aforementioned middlemen, has its own way of ordering the world and establishing under what conditions something can be considered true or false, acceptable or unacceptable, the mainstream or the marginalised. When artists need to rely on corporate middlemen for selling their works, they would be bounded by the rules and regulations that are different for different corporates. Under such situation, the autonomy that an artist is supposed to have would be deprived as their creative vision may be compromised under those powers.
A Decentralized Digital World
What is an NFT then? Is it a new art style? How is it relevant to artists who wish to sell their digital works in the digital world? The full term for NFTs is nonfungible tokens. It is a misconception to regard NFTs as a new art style or a material entity. Rather, NFTs are digital certifications allowing digital goods ownerships be identified– an artwork, a piece of music, a JPEG image etc. – with blockchains, a technology that makes digital goods scarce. Blockchains function as a form of public ledger built on technological elements of authentication, digital signatures, encryption and hashing. Blockchains play the role of a gatekeeper who oversees every transaction and ensures data integrity and accuracy. The technology of blockchain with its immutability is decentralised, meaning it does not rely on a central point of authority or a central platform or intermediaries to record the transaction details or verify data and information. With blockchains, an internet of ownership and transactions can now be made without authorities. A new type of democracy.
Democratising Participation and Economic Ownership
Simply put, with blockchain-based NFTs, digital goods ownerships can now be easily established. Every ownership, every transaction can be traced as it is recorded and verified on blockchains. A digital good with a NFT becomes the “one and only” original and such scarcity creates appreciation in the value of creative works which are sold online. If creative works can be made ad infinitum, there would be the downstream monetisation of those works. NFTs help artists to sell their unique digital creations directly to potential buyers/patrons without relying on intermediaries. Creators can exercise full autonomy over the right to display or use, the selling price, the terms and conditions of sales and re-sales. Thus, NFTs empower individuals who can pursue their passions and make a financial living at the same time. Besides, the more attractive value of NFTs is that they can be endowed with features which allows direct interactions between creators and their supporters depending on how creators programme their blockchains. For example, creators can hold private parties or events which are exclusive to their NFT holders or share future royalties with their NFT holders. If Kafka’s hunger artist lives in the contemporary world, he can sell his performance in an NFT way, without relying on any managers or circuses, to the audiences who truly appreciate his art of fasting, build an online club/community in which his NFT holders can gain access to an expanding array of activities and experiences that the artist can connect with his supporters. The hunger artist no longer stays hungry, spiritually.
A True Cyberutopia?
Despite the promise of a decentralised cyberworld, there is concern that the block-chain based NFT communities may be exploited as merely another business model that people use for monetary gain. The aesthetic value of digital creations may be reduced to just financial signs. Yet the beauty of NFTs is hard to resist when such technology provides a way for creators to disrupt the hegemonic control of cultural production, to de-hierarchise the system of distribution and consumption, to eliminate the control of what defines art and who can have access to “the art circle”. If we cannot escape any structures, at least the new structure provides more opportunities for creatives to have more autonomy over their creations and pocket the revenue which for decades, goes to the corporate intermdeiaries.
