Why I'm so Bullish on NFT Art

in #leofinance2 years ago

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Anyone that follows me on Twitter or keeps in touch on Discord has probably noticed that I've been getting very involved with the new Crypto Art community that I'm helping to build with some of my friends from PAL. I want to preface everything that I'm about to say with the usual "this is not financial advice" disclaimer, because honestly anything can happen and everyone's situation is different. I do however want to explain some of the reasoning of why I'm so bullish on this project and why I think it brings tremendous value to HIVE.

The Crypto Art scene has been growing and getting bigger on ETH for quite a while now. I noticed when it branched out into some other chains and I though Pixeos was a pretty cool project, but I noticed while these other platforms on other blockchains are gaining in popularity and finding success, it felt like the entire business model would just work better on a blockchain like HIVE.


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ETH is plagued by ridiculous gas fees and is in my opinion going to be unsustainable unless ETH 2.0 is successful and comes soon. EOS has similar problems and while I had high hopes for the blockchain, they quickly died shortly after the mainnet launch when I saw how the governance was operating and the RAM and Compute requirements were being manipulated. Hive doesn't have these problems which is why it's a logical choice for a blockchain to host this business model.

The lack of transaction fees and the three second block times allow for artists to keep more of their money, post their content quicker, and it allows art collectors and speculators an environment where they can process their buys and sells quickly all without having to worry about the price drastically increasing due to unreliable gas fees or transactions taking extremely long times.


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Recently, I have been seeing more and more absurdly high amounts of ETH being paid for art on different sites, just recently someone paid $100,000 worth of ETH for a single piece of artwork as you can see above. There are plenty of other examples out there, but we can suffice it to say that it's not uncommon for buyers to spend thousands of dollars on NFT artwork on a daily basis. There are literally millions of dollars being spent on NFTs each month.

To sum it all up, HIVE has better infrastructure without the extortionate resource requirements that other blockchains are plagued with. The convenience factor of operating on the HIVE blockchain for near-instant transactions without fees makes for a better user experience and less predatory business model. Currently the NFTs on showroom are drastically undervalued by comparison, and while I think some of this is due to the current undervaluation of the HIVE token, some of it is definitely related to the fact the site is just getting started and still picking up momentum.

For the last year, I've been exclusively buying crypto preparing for the next bull market, but over the last month I have been investing pretty heavily into art NFTs as well. I feel that they have huge resale potential and the value will go up as more of the Crypto Art community realizes the benefits of using HIVE. Everyone has to make their own decisions, but I know this a project that I want to support and invest in, not only due to the potential financial benefits for myself, but also because of the potential benefit to the whole HIVE ecosystem.


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I agree with you but there needs to be a slightly better UX for users not coming from Hive. Having to Swap the tokens to use in NFT is additional step newbies stumble upon and this is probably what is stopping for explosive growth. There should be some "automatic" option where you introduce your visa or send crypto and automatically converts it to Swap-Hive and funds your account. Newbies should not have to hassle with all that process.

That's actually in the works (swapping other crypto automatically.) As far as accepting fiat, it hasn't really been discussed at length, but personally I'm not really far it. It opens us up to things like chargebacks and potential regulatory issues that I'm not interested in dealing with. Hopefully the auto swaps will be ready soon, but I agree it is something that we need to get done asap.

Agree with all. Autoswaps should be the priority and also buying with other crypto not only Hive.

The other thing I'd like the team to consider seriously:
Most of the buyers and collectors are on ETH. If NFT Showroom allowed collectors to decide where to send their NFT, like "send to Ethereum" the buyers would exponentially increase. I know there are royalty reasons this is not done, but Splinterlands does it right...they allow the collectors to decide which blockchain they want there NFTs on. Collectors won't come to Hive bc they are not sure how immutable it is, especially since the images themselves are not hosted in a decentralized way. These issues still need to be understood and researched by the team.

We have discussed it and we aren't ruling it out for the future, but the problem with minting and sending to ETH for example is the cost to mint is going to go up anywhere from 15x to infinity based on the gas fees. There's going to be a lot of things to figure out, but we already charge so low to mint that even offering that option is going to require passing on those minting fees to the artists. We just don't charge enough to even consider covering those costs.

Thank you for being a supporter of the arts, your investment will yield dividends and is helping artists around the world thrive. Keep Rocking friend!

I think long term, NFT Showroom is going to be huge, we have some growing to do, but we'll get there.

Sort of nice to be able to blog while you're selling. You'll be talking to folks who already have hive bucks in their wallets. I'd like to talk art with a whale who has ridiculous amount of FAT, steem/hive bucks. oppps, is using the word "Steem" allowed here?

It doesn't bother me, but STEEM is dead to me since the takeover and then stealing funds from user wallets. We won't have anything to do with STEEM. I gotta get back to work, but feel free to join the Discord if you wanna chat with other artists/team members.
https://discord.gg/JudHKF

I can't understand how something like in that twitter post can have that much value.

The concept of it can be reproduced without too much hassle. How can something so easily copied be worth so much? I'm new to this entire digital art thing, not really sure what's going on....

You're not buying the image, you're buying one of a finite number of tokens representing ownership. So I have #8/30 of a particular piece. If anyone else wants one of those 30, they have 30 potential sellers to buy from. If they want #8 they can only buy it from me. Anyone can copy/paste the image, but that's like taking a photo of an autograph.

Why do some list edition #1 being more value than edition #5?

It's up to the artist, I guess everyone wants the very first edition. Those who don't charge more for #1 usually find it sells first.

Ownership in of itself might just be valuable. NFTs become even more valuable when they also confer real-world utility. It's early days, but art NFTs could be a good way to build licenses for stock art, and confer privileges in games.

Think about it like music, does digital music have value? Do people still want to support their favorite musicians? Are there people out there that will just pirate it regardless? Sure, but there's also people that see the value in ownership and want to support specific people. When it comes to art, the scarcity of those ownership rights really increase the value. Most of the pieces I buy are somewhere between 1 of 1 and 1 of 3. That means that there are only going to ever be 1 or 3 people that can prove ownership of a specific piece of art, and it also supports the artists and keeps them producing more art. As the value of that art appreciates, I get ROI and the artist likely becomes more popular and can charge more in the future.

Ok, I'm starting to get it now, thanks for the explanation.

My next question is naturally - who polices it? I mean what if a more famous artist decides to steal or out right copy a less famous artist's works and does it regardless of it being on a blockchain. What if someone in a restaurant in Guatemala just decides to print something off and pop it on their wall, or display something on a digital photo frame?

This type of value relies on a trust based community and as long as there is money involved (or survival translatable tokens) this tight based community will always generate tiers of value and with it elitism. While it seems decentralized at first - it will create its own levels of prestige and find a way back to the root source of the problem of this present system (of which we're experiencing a collapse in real time).

I feel like the world is moving more away from what is real and into the unreal or virtual creating value out of literally nothing and this value translates into the real world. It's nothing different to what the banks have been doing with money for the last hundred years or so - but is that a good thing?

As for music, as a musician - I don't value digital music. You can pay me for an album on the street that costs ten dollars or you can pay me 4 cents to play it five times on Spotify. Yet with NFT, I could convince you that I only have five copies of something and only you have the rights to play it if you own one of those five - but - copies of it may circulate and no one will be held accountable - there will be no penalties for some joe blow playing it in some cafe - unless I have a bunch of hacker friends that could make this person's life a living hell, of which, the copier had no idea what they were doing and also this is a level of accountability only affordable to those with said badass hacker friends.

Will the hacker community stand up for every breach of ownership rights with NFT? Or just those of significant value?

As with everything - the perception of value or the hype created around something creates that value. And then that value is actually translatable to survival value. If value is generated perceptively then an army is needed to protect that value otherwise the value is obsolete.

Why do I bother engaging in Hive or other blockchains if my views on virtual value are as stated? Because I simply follow the perception of value in order to increase my chances of survival. The world's perception of value and the actual things that are required that are actually valuable for survival are completely disjointed.

As a result hundreds of thousands of dollars can be spent to purchase an NFT like the one above and yet poverty kills 800,000 people a year. Yet you can sell an NFT if you have the right reputation and have the right friends for enough money to go on a world trip 20 times to visit all the countries of all these impoverished places. It's truly bazaar.

Thanks for engaging with the comment. It's great to learn more about what's going on in Hive. I'm fascinated by this concept, I'm just yet to see its value personally - regardless of the perception of value and hype it has currently generated.

Piracy is a lost battle, there is no winning against people doing what they will do. As far as combatting forgeries and plagiarism, that's done by manually onboarding and reviewing each artist and then collaboratively policing the platform with the team and other artists that don't want to see their work devalued by allowing theft on the platform.

What isn't disputable when we bring NFTs into the equation is ownership. The artist mints a specific number of tokens which creates the scarcity of ownership and is the basis for valuation from buyers/investors. While anyone can hypothetically just right-click download any image or pirate any music or movie, they won't have the digital "certificate of authenticity" so to say.

Like imagine every poster and digital image of Starry Night. Obviously Van Gogh didn't make all of those, he made a single painting. The rest are all copies and forgeries. Which one is going to be more valuable? The original that is irreplaceable or the random posters and knickknacks that you can buy for a couple of bucks. There's a really good article by SuperRare that takes a much deeper dive into this topic if you want to check it out.

On SuperRare, each tokenized artwork is created directly by the artist, using their cryptographic keys to create the NFT. Thus, it is the artist’s intent that the original, collectible, digital artwork is the token. Yes, anyone can download and view the image for free, but they don’t own it and they can’t gain any value from it without owning the NFT as well. As a collector you want as many people as possible to be downloading and enjoying the artworks that only you provably own because this is how the artwork gains value. Imagine if one million people around the world were featuring an artwork that only you owned on digital frames in their houses. THAT is a piece of art that has real value.

I disagree with this statement. If the idea of it can become popular and the veracity of this statement can be validated enough times in the right circles of people - then that is what creates the value of this way of thinking about art and that is what generates the value of an NFT. The concept itself is refutable.

But we're not living in a logical world... as much as we'd like to think.

I suppose I am going to go cover myself in mud in the lake and claim to be part of natural law. I don't want to be a part of the new world. 😂

I may not be on the same page in this reply or changing the subject. I watched this show on Netflix about tracing down originals and not counterfeits . Even if its a real Leonardo painting, it might not have value without documents. it could be counterfeit if no traceable document is found. Maybe it's all about tracing documents. A piece of art or music could be traced back to the date the blockchain was created. 500 years from now, a hypersuper quantum computer on a watch or ring could trace when the first earliest blockchain/ntf was created on an artwork and buy it for 899 billion dollars. Maybe you'll get 5% of 899 billion dollars on secondary sales when you bought an nft for one hive dollar, yesterday. I think the created dated blockchain has the final say so on who owns the artwork. something like that, right? I think an artwork needs to be documented by a very expensive art gallery to make it worth anything OR just for 1 hive, you can get the same thing but a million times better through nftshowroom.com, right?

I think the Beatles owed "happy birthday to you, happy birth ..." and Micheal Jackson bought the music. I might have read it's copy-right infringement to sing happy birthday ... over the air without permission. I think I'm really wrong about this but it does sound technically legal about happy birthday to ... owned by someone. so yeah, it would be rare to own a ummm, ummm a contract(?) on an artwork. I might have seen somewhere you could be part of owning a van Gogh art through ummm contracts or nft or cypto something. oh! a blockchain, I guess

I also see a lot of potential for Art NFTs and I think Hive as a social blockchain and zero fee transactions is the perfect match.

I think once the NFTs can be moved across other chains and more chains can come in and buy these NFT art it will explode! I agree with your sentiments it’s just all about opening it up to more investors

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That is something that is being discussed. One of the problems is we're building on HIVE to escape the problems of ETH. Making our NFTs have cross compatibility with something like OpenSea is totally possible and we aren't ruling it out, but it's going to bring back problems like artists paying exorbitant gas fees, having ridiculous wait times, and potential tech support issues with cross chain hiccups. It's not something we'll pursue lightly.

Mine is going to sky rocket 😆

I learned things on opensea and prepared to create a store there and were shocked on the gas fees there. never did follow through. don't have gas

Check out NFT Showroom, it costs 5 HIVE to mint 1 piece of art and if you're going to issue multiple editions it's 1 HIVE per additional piece beyond the first. We made it explicitly to create a much more affordable option that ETH. We also take a smaller commission (10%) and it runs on HIVE, so it's obviously much quicker.

I'm trying to decide if I should have one edition or 5 editions. If I had one edition, I'm worried that the buyer may not resell my art and I may never get any secondary royalties at all, ever. 5 editions increases my chance of secondary sales but it ain't rare enough. help. You said, "we". Are you part of the developers?

I'm not the guy coding it, but part of the team building the site and designing it, yes. From what I've seen, some artists do well with multiple editions and selling for lower prices, while others only ever make 1 edition and sell for higher prices. It takes some experimentation to find your market and demand level.

If people aren't buying a 1 of 1, you might have to try doing multiple editions cheaper the next time. It definitely takes some experimentation. Honestly I wouldn't worry about secondary sales first and foremost though, you gotta get it sold in the first place for that to ever become an issue. I tend to think of anything secondary as a happy bonus.

Some of my art are or looks traditional like an old school type. Maybe I should sell like an old school art gallery. I'm certain that some buyer would want to be the only one to own a single edition. For now, I'm going to issue single editions like it's been done that way for thousands of years. It might be expensive but someone might enjoy owning the only piece. I may never see a secondary sale if the buyer holds it to himself. thats the risk I take but it would be like selling the only physical artwork. Hilter stole famous artworks and I think some were never recovered. I worry my art may never be recovered like if the buyer dies or forget the secret password to resell, the secondarys

It could happen, but compared to traditional galleries that usually take 50% of sales, have to deal with inventory, rotation, insurance, etc... the cost of dealing with NFTs is minimal on HIVE. On ETH you have a lot of gas fees, but it really doesn't hurt to try minting a piece and see how it goes. If it doesn't sell and you decide to go the physical gallery route, just burn your token, you're out a whole 5 hive (less than $1 right now) and it is removed.

What happens to secondaries when tokens are burned?

Who gets the 5 hive per piece ? the nftshowroom founders or boards? Or is it some minimum to create a blockchain?

It goes to the team to cover development/infrastructure costs as well as covering our Hive-Engine expenses. It also has the added benefit of making it not free to spam stuff 😁

umm. maybe they can put something in the Jackpot or distribute something to the artists to encourage them to use/return to your site. BAE-blockchainartexchange does that. I think they have their own internal BAE-dollars, sort sort of rewards.

And we thank you for this! Without buyers, artists cannot survive!
I love NFT Showroom. I mint on there more because ETH gas fees really do suck! The only thing I gotta say though, Rarible gives out RARI tokens when I buy or sell on there, and that incentive is pretty powerful. I've made way more on Rarible actually because of this.