Sotheby’s joins the non-expendable token craze through a collaboration with digital artist Pak.
“We’ve been following the NFT space for some time,” Sotheby’s Chief Executive Charles Stewart said Tuesday on CNBC’s “Squawk Box,” where he announced the auction house’s partnership with Pak. The next sale is scheduled to launch next month.
“This is new to all of us,” Stewart added. “But there are a lot of things here that are really exciting and we think it has staying power.”
Pak has been producing digital art for decades, but the identity of the artist is unknown.
“The artist prefers to remain anonymous, in part because he wants it to be about art, which is not necessarily something new in the art world,” Stewart said. “But it’s one of the many new things about crypto art, in particular, that I think is different and potentially a bit disruptive, certainly when you compare it to the traditional art world.”
The decision by Sotheby’s, founded in 1744 and known for selling multi-million dollar paintings and other luxury items, to embrace NFTs represents the latest milestone for the burgeoning digital art form. It comes after Christie’s sold an NFT collage at auction last week for $ 69 million, elevating its creator, Beeple, whose real name is Mike Winkelmann, to a place among the the three most valuable living artists.
NFTs are blockchain-based assets that are unique by design, a scarcity that advocates say supports their value. The ownership of a specific NFT is recorded on a blockchain network, the distributed digital ledgers that support cryptocurrencies like bitcoin.
In addition to digital artwork, basketball highlights known as NBA Top Shots have become popular to buy as NFTs. Earlier this month, rock band Kings of Leon released their latest album in the form of NFT.
Some have dismissed NFTs as a fad whose values will plummet over time. Skeptics also point out that the rise of NFTs has coincided with a massive rally in cryptocurrencies like bitcoin, infamous for its volatility, and ether, which runs on the Ethereum blockchain network.
The buyer of Winkelmann’s $ 69 million NFT was pseudonymous crypto investor Metakovan.
Winkelmann has said that he sees a range of applications for the digital infrastructure that supports NFTs. “I really think this is a technology that has so many use cases,” he told CNBC on Friday, calling it “a blank slate, even beyond digital art.” He added: “Whenever I want to test the property, I think there is a use case.”
But even for NFT-based digital art, it’s still “too early, it goes without saying,” according to Sotheby’s Stewart.
For its partnership with Pak, New York-based Sotheby’s will sell unique pieces of digital art and “the so-called ‘open editions’ in the NFT world, where many people can buy tokens for the same work,” he explained. Stewart.
NFTs are bringing a new interest and a “new aesthetic” to art, Stewart said, and he argued that there is the potential to “bypass many of the traditional controls and investigative processes of the physical art world.” He added: “That is something that is really exciting and as it unfolds, we are very curious to see where it takes us all.”
Benoit Pagotto, co-founder of RTFKT, who helped create a collection of recently sold NFT-based digital sneakers, told CNBC that he hopes it will take some people a little time to fully understand the excitement around crypto collectibles.
“Educating and updating people is something we have to do,” Pagotto said Tuesday on “Squawk Alley.” “But at the same time, we know that people will never understand [NFTs]Just like today, there are still people who don’t understand why esports is so strong and such a cultural movement. With these people, we will not spend much time explaining. “
– CNBC’s Jessica Bursztynsky contributed to this report.