How A 10-Second Video Clip Sold For $6.6 Million
Last year, in October 2020, a Miami-based art collector named "Pablo Rodriguez-Fraile" spent around $67,000 on a 10-second video artwork that he could have watched online without spending even a single penny. Last week, he sold it for $6.6 million.
This video was released by digital artist Beeple (real name is Mike Winkelmann) and verified by blockchain, which serves as a digital signature to certify who possesses it and to certify it is the original work or not.
It’s a new sort of digital asset identified as a non-fungible token (NFT) that has gained popularity during the pandemic as enthusiasts as well as investors scramble to spend huge sums of money on things that only exist online.
Blockchain technology allows the objects to be publicly verified as one-of-a-kind, in contrast with traditional online objects which can be infinitely replicated.
“You can walk into in the Louvre and capture a picture of the Mona Lisa and you can have it there, but it lacks any value because it doesn’t have the source or the history of the work,” stated by Rodriguez-Fraile, who said he first purchased Beeple’s piece because of his knowledge of the United States-based artist’s work.
“Non-fungible” refers to objects that cannot be swapped on a like-for-like basis, as each one is unique unlike “fungible” assets like dollars, stocks, or bars of gold.
Examples of NFTs include digital artworks and sports cards to pieces of land in virtual environments or exclusive use of a cryptocurrency wallet name.
The computer-generated video sold by Rodriguez-Fraile displays as a giant Donald Trump fell on the ground, his body covered in mottos, in an otherwise peaceful setting.
OpenSea, a marketplace for NFTs, said it has observed monthly sales volume growth to $86.3 million so far in February, as of Friday, from $8m in January, quoting blockchain data. Monthly sales were at $1.5m one year back.
Investors alertness, though, that while big money is flowing into NFTs, the market could represent a sustained rise.