Beeple x Christie’s x MakersPlace: A Retrospective
tl;dr: Christie’s auction of Beeple’s “Everydays: The First 5000 Days” marks a major step forward for NFTs, but scalable crowdsourced appraisal infrastructure will be needed for this burgeoning medium to scale and will allow a new class of appraisers to capture value from their expertise.
Earlier today, Beeple’s “Everydays: The First 5000 Days” sold at auction for an eye-popping $69,346,250. The successful collaboration between Beeple, a pioneering digital artist, and Christie’s, a renowned auction house and staple in the art market, marks an important milestone in the world of crypto art.
This collaboration showcases a willingness on the part of the traditional art world to recognize NFTs as a legitimate medium for art. In Christie’s own words, “The recent introduction of non-fungible tokens (NFTs) and blockchain technology has enabled collectors and artists alike to verify the rightful owner and authenticity of digital artworks…Christie’s has never offered a new media artwork of this scale or importance before.”
The embrace of NFTs by the traditional art market will no doubt fuel further growth in the NFT space and lead to a significantly larger market for artists selling their work as NFTs.
Scaling NFT markets with crowdsourced appraisal infrastructure
As the art markets expand and the types of art that get created become more diverse, it’s important to have appraisal/pricing infrastructure that can scale with it.
Auctions are powerful, frequently used mechanisms for pricing art. However, they require the art to change hands for its price to be found. With how infrequently art changes hands, auctions are best accompanied by pricing mechanisms that are more compatible with the low-velocity nature of art. Appraisals let us query experts’ opinions regarding an asset’s worth without it needing to change hands at all, but existing appraisal networks are often constructed behind closed doors and composed of a finite set of pedigreed experts. This approach is slow to adapt to new mediums and types of art.
With this NFT offering by a major auction house, we may be seeing some of these limitations in existing appraisal networks take shape — starting with an unknown price estimate for the Beeple piece. In other words, the closed network of professional appraisers used by the auction house seemingly didn’t have high enough conviction in their ability to appraise the Beeple piece accurately to quote an estimate. The price was marked as “unknown.” “Putting an estimate on the sale of Beeple’s first work” at the auction house was “well-nigh impossible,” Christie’s said.
Bidding opened at $100.
Then the price quickly shot up into the millions.
How will the masses gain exposure to NFTs if their prices (especially for less-popular pieces) are routinely “unknown?”
We need more scalable appraisal infrastructure to support the growing, diverse, and increasingly mainstream NFT art market.
Unlocking new value for collectors and experts
A decentralized appraisal network would overcome some of the shortcomings of existing appraisal infrastructure and unlock opportunities for a new class of appraisers altogether. Such a network may involve the long-time Instagram followers of Beeple. Maybe such people would have a better insight into the price of Beeple’s work? More generally, maybe any unknown artist’s early supporters should be involved in appraising the artist’s work?
That’s not to say that professional appraisers, collectors, and art dealers do not have a place in pricing NFTs — they clearly do. Professional appraisers should and will be some of the most active appraisers in decentralized appraisal networks. But laying the foundation for appraisals to be conducted in a decentralized setting will significantly expand the types and number of people that can capture value from their pricing expertise, making the insular art world more accessible for collectors and experts alike. Participants of all stripes will play an important role in continuing to build and grow NFT art markets.
NFTs are just as much of a “collector’s movement” as they are a “creator’s movement”.
Crowdsourced appraisal networks are particularly well suited to efficiently pricing subjectively valued and low-velocity assets like art. Powered by new types of appraisal games, they work by querying experts and then rewarding them for providing honest appraisals about what they think a particular NFT is worth. In turn, efficient & accurate price feeds for pieces of art can arise. With decentralized appraisal networks, one can discover the value of any NFT at a fraction of the cost required to purchase it and without it ever needing to change hands.
In conclusion, the Beeple and Christie’s collab was clearly a massive success and a significant milestone for NFTs. As the art markets scale and diverse pieces are created by emerging artists of all kinds, we will need appraisal/pricing infrastructure that can scale with it. Such infrastructure will enable the NFT-digital art space to mature and in turn unlock new opportunities for art collectors and artists alike.
If you’re interested in learning more about crowdsourced appraisal networks, reach out on Discord or shoot us an email at email@example.com! We would love to chat about the new ways you can capture value from your expertise with Upshot.