Hate NFTs? I have some bad news for you…

If you think NFTs are scammy/bad, wait until you learn about the art market

Amelia Winger-Bearskin
8 min readJul 25, 2022

With the recent crash in crypto markets and the gnat-like attention span of major media outlets, the fervor around NFTs has subsided a bit in recent months. It’s hard to remember now, but earlier this spring they were all anyone could talk about. So last semester, when passions were running high and the luminaries of our field were having earnest conversations about something called “slurp juices,” I asked my students and students from over 20 other universities what they thought of NFTs

According to many of them, NFTs were either tasteless artifacts of a cynical pyramid scheme, or else they were a radical new way for artists to make the money they deserve. On the one hand, NFTs were a major contributor to the climate crisis and a blight on the environment, but on the other hand, the same can be said of air travel, fast fashion, or smartphones. Some students lamented that NFTs were cheap, tasteless, algorithmically generated schlock with no aesthetic value, but others asked how this was different from any other art.

a digital Billboard showed during the 4th annual NFT.NYC conference, a four-day event that featured 1,500 speakers from the crypto and NFT space and hosted 14,000 attendees | Getty Images, Noam Galai / Contributor June 20th, 2022 in New York City Times Square

I’m not sure what I expected them to say, but I was certainly caught off-guard by the intensity of students’ reactions across many different locations and institutions. They had strong, emotionally-charged opinions about a technology which I had always understood to be fundamentally an administrative tool. Like most projects in the crypto/blockchain space, NFTs are designed to address questions of ownership and accounting.

Art markets can be irrational, arbitrary, and subject to the same scams and schemes as any market. And maybe a few shenanigans that are unique to the art world.

The Fairness Question

The prevailing sentiment had to do with the question of fairness, which is at this point a kind of deflationary moral currency (the less of it in circulation, the more ardently we clamor for it.) These students, almost all of whom are artists themselves, objected to what they saw as an unfair discrepancy between the quality of the work on display in some of the more famous NFT collections, and the exorbitant prices that these pieces were fetching on the market. Most of these students can draw a Bored Ape or Lazy Lion in their sleep. Why should they be buying ramen with student loans while some grifters with a fraction of the talent are getting rich?

Long Beach, California the sign for the Bored Ape Yacht Club NFT Themed Restaurant, Getty Images, Mario Tama / Staff April 9th 2022

I do sympathize with students. The truth is, art markets are not fair. They can be irrational, arbitrary, governed by chance and circumstance, subject to the same scams and schemes as any market. And maybe a few shenanigans that are unique to the art world.

Almost every mainstream critique leveled against NFTs applies just as easily to art markets

To start with, how about the fact that experts estimate over fifty percent of artworks in circulation globally to be fake. The preponderance of illegitimate goods on the market is upsetting for earnest collectors and institutions whose commitment to the arts is sincere. But that’s not everybody. Many wealthy individuals and firms use artworks as stores of value, or investment vehicles. For them, art can be a way to drive up markets on assets they already own using cultural institutions like museums and galleries to increase the value of art collections they inherited from their family. Sometimes people even take matters into their own hands by purchasing artworks, using family ties or close connections to museums or other cultural taste-makers to hype the work in their collection, driving up the price and allowing them to sell for a profit. Art can be a useful tool for money launderers who take advantage of market whims, hype, and fluctuating asset prices to disguise flows of capital.

If you hate NFTs for what they’re doing to commerce and art, I have some bad news for you: almost every mainstream critique leveled against NFTs applies just as easily to art markets.

It’s been this way in the art world for some time. For example, Edward Kienholz had fun with the absurdity of art markets with a 1989 print series. He stamped 395 identical pieces of paper “For $1,” “For $2,” and so on, all the way up to “For $395.” Each piece was to be sold at the price indicated, at least initially. Kienholz was making a joke about a strange feature of art markets— the notion that once the last print in the series sold for $395, all previous works would be worth at least that much, just by virtue of being part of the same series. The value of the entire series is set at the highest auctioned price any member of that set has ever gotten. I don’t know what a print in Kienholz’s series would sell for today (interested parties can inquire with the gallery), but I can tell you it’s more than $395.

One of my all-time favorite performance pieces is Lee Lozano’s 1969 “Real Money Piece.” The idea was simple: Lozano took a decent amount of cash in various denominations, stuck it in a jar she kept in her apartment, and casually gave it away to whoever came over. “Offer to guests coffee, diet pepsi [sic], bourbon, glass of half and half, ice water, grass, and money,” she wrote in her notes. “Open jar of real money and offer it to guests like candy.”

Lee Lozano kept track of each person to whom she offered money out of the jar, how much they took, if any, general impressions of how each guest received the offer of free money given without any explanation or apparent reason. Reactions varied. Some people found it amusing, some thought it was strange, some probably didn’t think much of it at all. Lozano doesn’t always say:

Apr 17 Keith Sonnier refused, later screws lid very tightly back on. Apr 27 Kaltenbach takes all the money out of the jar when I offer it, examines all the money & puts it all back in jar. Says he doesn’t need money now. Apr 28 David Parson refused, laughing. May 1 Warren C. Ingersoll refused. He got very upset about my “attitude towards money.” May 4 Keith Sonnier refused, but said he would take money if he needed it which he might in the near future. May 7 Dick Anderson barely glances at the money when I stick it under his nose and says “Oh no thanks, I intend to earn it on my own.” May 8 Billy Bryant Copley didn’t take any but then it was sort of spoiled because I had told him about this piece on the phone & he had time to think about it he said.

Smart Contracts (smart as in fair, not smart as in Blockchain)

One scholar who has done a lot of work researching and highlighting the modern dynamics of secondary art markets is Professor Cheryl Finley at Cornell University. I first became aware of her research after meeting her at the University of Florida’s Harn Museum where she gave a public talk about smart contracts (smart as in fair, not smart as in Blockchain) and new protocols that could have a positive impact on those who are often left out of the economic benefits of their own artwork, a group of artists which historically includes women and women of color.

Cheryl Finley on the right, with Hank Thomas and Dr. Deborah Willis attending the 2018 Aperture Gala at Ceder Lake on October 30th, 2018 in NYC, Photo by Patrick Mullan via Getty Images.

Her talk included findings featured in her famous op-ed in ArtNet, co-authored along with Lauren van Haaften-Schick & Christian Reeder & Amy Whitaker.

NFTs allow us to think about and hack on formal contractual relationships outside a system of laws that is currently not set up to service our community.

The ArtNet article: The Recent Sale of Amy Sherald’s ‘Welfare Queen’ Symbolizes the Urgent Need for Resale Royalties and Economic Equity for Artists dealt with a portrait by Amy Sherald’s 2012 titled “Welfare Queen” a portrait of a regal woman in a purple dress wearing a sparkling crown and elegant set of pearls in front of a vibrant red background.

Artist Amy Sherald had initially sold the painting “Welfare Queen” to Imani Perry, the Hughes-Rogers Professor of African American Studies at Princeton University. Sherald agreed to accept remuneration for the piece on a payment plan in order to accommodate Perry’s budget at the time.

Amy Sherald rose to fame over the next several years, both for her 2016 portrait of Michelle Obama for the National Portrait Gallery and for her full-length portrait of Breonna Taylor, which became one of the most famous works of art of the past decade.

As is often the case, Sherald’s rising star in the art world drove up the price of her earlier works. When Perry chose to put “Welfare Queen” up for auction in 2021, the piece sold for $3.9 million.

Amy Sherald speaking about her work in front of her painting “Miss Everything (Unsuppressed Deliverance) | Getty Images
Raleigh News & Observer
/ Contributor May 2018

It’s a great success story for Imani Perry, whose early investment paid off in a big way. But Amy Sherald, whose work was directly responsible for the increase in the painting’s value, and who Finley et al. tell us was on an artist’s shoestring budget when she agreed to make accommodations to sell “Welfare Queen” in 2012, did not see any of the money from the 2021 auction. That money went to Perry and to the auction house.

When Sherald sold her Breonna Taylor portrait to the Smithsonian and Louisville’s Speed Art Museum, she was able to fund a $1 million scholarship at the University of Louisville in Taylor’s honor. This is an incredible testimony to what an artist can do for the community if they themselves are able to accumulate wealth based on the important cultural objects they create for the larger public.

NFTs may not have put an end to everything that was wrong with the art market — the fakes, the money laundering, the market manipulation — but they didn’t invent these problems either. Blockchain and NFTs deserve a lot of credit for making these issues transparent for a lot more people. More and more ideas are surfacing every day about what it really means for a contract to be smart and serve the interests of artists.

At base, NFTs are trying to solve a copyright problem. They allow us to think about and hack on formal contractual relationships outside a system of laws that is currently not set up to service our community.

For me, Amy Sherald is an example of the good that can be achieved with smart contracts (as in, well-considered, self-determined contracts, not necessarily blockchain contracts.) Giving back to our community, setting our own terms for where and how our work can be sold or displayed, and ensuring artists share in the equity of our own work and in the economy our labor produces.

Photo of Amy Sherald during New York Fashion Week attending Ulla Johnson at the Brooklyn Botanic Garden, Getty Images
Dominik Bindl
/ Stringer September 2021



Amelia Winger-Bearskin

Banks Endowed Chair AI and the Arts, Digital Worlds Institute, University of Florida | studioamelia.com