Museums Are Cashing In on NFTs

LONDON – “It’s very special to wake up to one of these things – to have Leonardo at home,” said Joe Kennedy, director of the Contemporary Art Dealership Unit in London, recently excited about the wide-framed LED screen with digital replica. Leonardo da Vinci’s “portrait of a musician” shines on the wall of his gallery. The original Milan Ambrosiana Museum was 800 miles away.

Leonardo was one of six ultra-high-resolution replicas of paintings of the centuries at the unit’s Moodly-published “Eternalizing Art History” exhibition, which closed on Saturday. The show was the latest attempt by cash-poor museums to make money by selling nonfungible tokens or NFTs. Last year, NFTs, typically pegged to high-flying but volatile Etherium cryptocurrencies, took the market for art and storage by storm, with sales estimates in the billions.

Outbreaks appear to be exacerbated by lockdown and re-privatized government spending, putting public museums around the world under financial pressure. Yet, despite the overwhelming sales figures achieved by NFTs, few organizations have explored this digital asset as a way to raise funds.

The unit and its Florence-based technology partner Cinello have forged licensing agreements with some of the leading Italian museums to create a hybrid offer of limited edition LED reproduction in a period-style wooden frame, each with a unique NFT.

Digital versions of the same size as Leonardo’s portrait, Caravaggio’s “Fruit Bowl” (also in Ambrosiana) and Raphael’s “Madonna of the Goldfinch” (in Ufizi in Florence) were offered in nine editions, costing up to 100,000 euros. To € 500,000 per unit (approximately $ 110,000 to $ 550,000). Fifty percent of sales revenue went back to licensed museums.

As of Friday, after the show closed, seven sales of up to € 250,000 were confirmed, including at least one Leonardo NFT.

The collaboration between the unit and Italian museums follows previous attempts by other European organizations to move the NFT bandwagon. Among them is the State Heritage Museum in St. Petersburg. Petersburg, Russia, which last September auctioned NFT replicas of its five most famous paintings, raising 444,000.

The Belvedere Museum in Vienna has fragmented the digitized image of Gustav Klimt’s “The Kiss” into a one-off drop of 10,000 NFTs. It was released in February. 14, Valentine’s Day, priced at 0.65 Ethereum or € 1,850. Earlier this week, Irene Jagger, the Austrian museum’s media relations officer, said about 2,400 of these Climate NFTs, originally worth about € 4.3 million, had been sold.

The production of NFT uses a lot of energy, especially on the Etherium blockchain. According to one estimate, the computing power required to mint an NFT produces the same amount of greenhouse gas as a 500-mile journey in a gasoline-powered car. Nonfungible tokens can make money for a museum, but they also have the potential to cause environmental damage that could damage the image.

The more eco-friendly offer of 50 NFT based on the William Black Print, 999 units of the “green” cryptocurrency Tezos (approximately $ 3,290 at current prices), has attracted eight sales so far for the Whitworth Museum in Manchester, England. , Since its release in July, according to Bernardin Broker Weeder, chief executive of Vastari, the project’s technical partner.

Environmental problems are one of the reasons that barely a dozen museums have so far experimented with NFTs as an alternative revenue stream. The volatility and ambiguity of unregulated cryptocurrencies, the difficulty of finding reliable tech partners, and the cost of such partnerships have also been cited by museum professionals as reasons for hesitation.

“American museums are nonprofit organizations that operate in public trusts,” said Tina Reverse Ryan, a curator specializing in digital art at the Albright-Knox Art Gallery in Buffalo. “This means that legally and morally they are bound to move slowly.”

Rhea added, however, that many American museums are currently having internal discussions about how NFTs could be involved in their mission. “The market is changing very fast,” she said. “There are legal, environmental and other implications that need to be considered very carefully.”

One organization that has wasted no time in accepting the NFT as a fundraiser is the British Museum in London. The museum entered into a five-year exclusive partnership with the Ethereum-based NFT platform LaCollection in September, chaired by former British finance minister George Osborne. Since then the museum has made many token drops in various editions, ranging in size from two to 10,000, using digital copies of the works of Katsushika Hokusai and JMW Turner. Prices range from $ 500 to $ 40,000.

Aware of the environmental sensitivities of large-scale token drops, LaCollection stated on its website that “for every mint NFT, we plant a tree” that “more than offsets” the carbon footprint of the activity.

Last month, sales “reached seven figures,” project spokeswoman Sophie Reed said in an email. The British Museum itself declined to comment.

Sus Andersen, an assistant professor of museum studies at George Washington University, said he was skeptical of museums being involved in the NFT craze. “It risks becoming a game rather than focusing on work. We should make resources available to as many people as possible,” Andersen said.

Yet she acknowledged that there is currently a market for NFTs from museums. “It may not last long, but this is a moment where there is potential for fundraising and visibility,” she said.

At the moment, that market is relatively small. Publicly funded galleries are wary of cryptocurrency, and, for those immersed in the world, it’s not the speculative cool of “original” NFTs like cryptopunks or board apps in digitized old art that could sell for millions. So far, no museum NFTs have made a profit that draws attention to resale platforms such as OpenC.

But what if the reproduction of a masterpiece is so good that it looks just like the original, hanging in a beautiful frame on the wall? Don’t they have the capacity to sell in the millions or at least in the hundreds of thousands?

On the final day of the unit “Eternalizing Art History” show, Eve Smith, a lawyer, seemed impressed. “This is the second time I’ve been here. I was absolutely amazed, “said Smith, after seeing a backlight ultra-high-resolution digital copy of Francesco Hayes’ 1896 painting” The Kiss “at Milan’s Pinakoteca Brera Museum.

“It looks like satin. It looks like the texture you are looking at, but it doesn’t,” said Smith.

But would that unit be willing to pay € 180,000 to own one of the nine editions of London, plus its NFT?

“It depends on how much you like Repro,” Smith said.

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