Why buy something tokenised?

Let’s say for a moment that everything creative was only available as a token (registered on blockchain). The latest music, poetry, e-book…..’

Despite selling quite a few crypto artworks now on MakersPlace (collectors either pay in Ethereum or for fiat via paypal etc.) the truth is I’m still only beginning to see the implications of tokenization. (And there are still details that are playing out, or are still to be ironed out.)

[That’s why this post is in fact a way for me to reflect and describe what’s happening, and share a new sense of interest towards how the online landscape may soon begin to change. ‘Cryptoart‘ is leading the way.]

MakersPlace is effectively acting for me as one art gallery to reach interested collectors. It would be difficult just now to sell outside of MakersPlace, although I’m currently experimenting with Mintbase. It gives me more freedom to mint what I choose, via its growing, versatile minting interface – from tickets, to art, and now to music – but it is less of a marketplace for collectors right now.

Why sell my art as limited editions?

For one thing, it helps me prepare more finalised (often animated) editions of images I feel happy with, just as though I’m exhibiting in a real gallery and readying works for collectors.

'bitcoin bubbles'

‘forever blowing speculative bitcoin bubbles’ – click to see 1/5 of this moving artwork in full…

And much more

Let’s say for a moment that everything creative was only available as a token (registered on blockchain). The latest music, poetry, an e-book or real assets like canvases of art (linked via a hidden, physical tag).

As a buyer or collector (depending on the conditions of sale) I can now buy into something more directly. I could then trade it on more easily, once I’m tired of it. Ethereum will carry all the details for that token: proof of ownership is always traceable and verifiable.

Also, there will only ever be so many editions available, since they all need to be presented in some kind of format when published.

If there are 10,000 copies then it’s true I’m not buying for the scarcity value.

Tokens represent assets, and they can also represent rights to an asset, or something of value from the past, the present or the future.

So with assets in general… what is the point, where you can just buy something directly from Amazon today? Or even sell that item on again, on Amazon, or locally on Facebook groups etc. Well, for one thing you can’t access the transaction history for that item. You don’t know for sure if it’s new, or if it’s authentic.

Ethereum information cannot be changed or tampered with: it’s immutable.

Also, creators on Amazon may not want everyone to access their e-book. They may only want a certain amount of people at any one time to have access to their creation. This will enable value to be retained for a next edition. Or they may want to know how many of those tokens have been unlocked.

And/or, they may need to attract investors to their (unfinished) book, by selling tokens for that future release (thereby funding its creation). This tokenisation – with multiple owners – obviously applies to artworks, houses, projects, tickets etc… fundraising….

Creators could also offer giveaways of a certain amount of books as tokens, or even pay people in crypto for reviewing and ‘testing’ their work. Along with a whole lot of stuff I’m probably not aware of.

This will all be possible, and it is now, effectively.

Creators, artists etc. can limit the copies created of their work, by promoting special ownership and access to their files. This creates demand for their work, instead of widespread availability. The latter may apply more to well-established artists or bands but we could expect prices to rise for creative things everywhere, across the board, eventually. It may be a different world to the one we’ve known, where everything is cheaply available, and intermediaries, platforms and publishing companies can take a lot of the cut.

But mostly, for now, tokenisation allows for more direct rewards to someone for their creativity, for selling a limited amount, perhaps even a one-off edition. It gives artists, writers, creators more control over their publications, and to see who has them.

You can use Mintbase or Opensea to make your token of value, and your conditions will be registered globally on Ethereum.

‘know yourself’, a rare 1/10 editions you can own. It links to a page here on Ade’s Press.

But…

With everyone minting their own rare artworks and content, ‘value’ perhaps becomes more competitive, and can remain just as elusive.

People will tokenise all kinds of things, but consequences of automated transactions will still have to be made ‘real’, and enforced.

The underlying blockchain tech itself, still needs to evolve and get faster, and hopefully Ethereum will transition to Ethereum 2 smoothly from this year onwards according to its roadmap. Other competitor networks are on the rise but may well integrate in some way, so it’s not a big concern.

However, I do wonder about conflicts where an asset is tokenised on different blockchain networks. Items supposed to be rare may not be so rare, if I’ve minted on multiple networks. Buyers will have to be able to check this before they buy a ‘rare’ piece of art, since the same piece could have multiple owners across networks. If the same asset was discovered on different networks this would of course undermine the artist’s integrity going forwards considerably.

Crypto prices (ETH for example) should become more stable as more investment enters the space, but Ethereum has already been pretty stable, or positive (since lockdown) and with plenty of room to grow if it can upgrade.

Still, the ‘gas price’ can fluctuate when it comes to publishing data on Ethereum, and it’s a reflection of network congestion.

Next, tokenization does grant a certain level of control, and more direct transfers, but never total control. Digital items can be automated in smart contracts no problem, but with physical items, these may still be best bought and sold on Amazon, Ebay etc.

But let’s think about how fast Amazon grew in the 1990s just by selling books, you can see how – quite possibly – Opensea for one, could become the next Amazon, as long as they focus on being super user-friendly and fast.

Mintbase could become more the WordPress for tokenization of content. It hopes to become a faster dropbox of decentralised storage, via its recent Arweave blockchain partnership.

Mintbase + Arweave

Why is this move important? Because, even if Mintbase as a platform over time disappears, and the process of minting tokens is done elsewhere…. the content will still survive in storage outside of these platforms, since any NFTs remain registered on an unstoppable, permanent blockchain. Not on a company server. I’ll come back to this below…..

Owner perks

Once you own a token or piece of cryptoart, your ownership will allow you some benefit depending on the conditions of sale.

For example, for an artwork on MakersPlace, you will get special access to the full resolution download of the art. You can copy this item and spread it around, but it may only devalue your purchase.  It doesn’t change your recorded ownership of the original. The eye of blockchain records all.

But storage of assets, files and tokens remains an important consideration. Decentralised storage is the ideal.

Besides better rewards for creators (where before there were few) another big advantage, and for everyone, is… permanence. More and more, we (all) feel frustrated by having to sign up with new services or use new middlemen. Centralised storage is fast but it relies on companies and is vulnerable to attack. Decentralised storage protocols will allow permanent storage without having to change providers.

What a relief! Never having to worry whether Facebook, Gmail, Google, Microsoft will mishandle our data or be taken over by competitors, or change their plans. The blockchain networks of the future are coming, and the big guys understand this, and are consequently getting involved with public blockchains, either as node providers, infrastructure providers etc.

(Same goes for mobiles and computers by the way. Who can’t wait for blockchain-ready hardware from major companies like HTC, Samsung or Lenovo to emerge? We could be freed from company-controlled operating systems and can log in with our blockchain-based digital identities.)

But speed is slower right now for decentralised options. That’s also why Mintbase has teamed up with Arweave [see a previous post] to transition its storage of NFT files to the ‘Permaweb’, which should provide ‘future-proof’ digital asset storage.

Platforms or Marketplaces

So just to re-iterate: There are many platforms emerging looking to tokenise things as a service, like for music, books, photography, wine. Some of these have their own cryptocurrency that creators then get paid in, or represent the asset.

But the truth is you can mint any token you want yourself, and it can be traded on sites like Opensea or Mintbase.

The features and control that Mintbase is giving to creators are growing.

All you need is a MetaMask or Ethereum web wallet – and some Ethereum – and you can use the above sites to offer tokens to anyone, for anything, even tickets to your next birthday party?

[Note: More internet users need to start using Metamask and mobile Ethereum wallets. But adoption is growing here, steadily.]

For creators, it’s still early days, but exciting ones. However, it’s important to be true to your collectors and consider how many items to mint, carefully.

 

Ade’s Press art tokens

So…. are you interested in owning a rare piece of ‘cryptoart’ I’ve minted myself? Ready your MetaMask etc. wallet and head over to Ade’s Press crypto art Mintbase store.

Alternatively, you can visit my MakersPlace store.

Note: I do create different editions or versions of my art, in various formats even if they’re (sometimes) exactly the same image (until I’m done experimenting with that image).

As an example, one image might have: a static edition, an animated gif, or a video mp4 edition. Sometimes I make slight alterations in between.

.

Finally, happy tokenizing, happy creating, and/or happy collecting!

Comments or corrections about the above or from anyone with experiences collecting or selling cryptoart – very welcome.

Resources

Marketplaces:

Opensea.io – + create your own marketplace
Mintbase – + create your own marketplace

Art:

Makersplace
Superrare
KnownOrigin

Note: Cent is also a platform where you can share NFTs (with its own button now), and draw attention to them. Search for other posts about Cent on this blog.

Note: Collect and trade fine wine on Opensea!

June 2020

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