Understanding Art Tokenization

The existing art gallery model places much emphasis on the established artist who can afford the massive commissions that are charged by art galleries. For many small-scale artists, this commission-laden model has proven unprofitable as most artists are unable to break-even due to the high costs of having one’s artwork displayed in established art galleries.

The alternative leaves many small-scale artists confined to garage workshops and even roadside stalls which do very little to help small-scale artists in building a brand and reaching their target market as they would if their artwork was displayed in prestigious art galleries. This is the foremost problem we are addressing as we believe that the world of art collectors and the people from whom it originates is much more connected than art galleries would have us imagine. Magnifying these fundamental peer-peer transactions upon which the art gallery model is built is at the core of our mission and using the internet as a tool for increasing the traffic small-scale artists receive on their work, we imagine a future where small scale artists receive the same or even increased viewership on their work as do artists who have their work displayed in high-end art galleries on Long Street.

As much as the internet will aid in increasing the traffic which small-scale artists receive on their work, we believe tokenization can incentivize the growth of the art collector’s market. A majority of the population today wouldn’t exactly be classified as enthusiastic art collectors but an increasing number of people are getting used to the idea of owning digital collectibles such as cryptokitties. Spreading this idea to real world goods such as artwork and crafts work is one way we think the art collector’s market as a whole may be broadened. To make sense of how we imagine tokenization in the art industry we will explain the actual meaning of the word tokenization and distinguish between the ERC-20 and ERC-721 tokens.

Tokenization refers to the process of issuing assets, followed by the circulation of rights on tangible and intangible assets in the form of tokens issued via digital systems based on the blockchain. There are many different blockchains from which tokens can be generated, however we are going to be utilizing the Ethereum blockchain for both the ERC-20 equity token as well as the ERC-721 tokens which will represent artwork and crafts work. Now we will distinguish between ERC-721 tokens and ERC-20 tokens, the ERC-721 is a free, open standard that describes how to build non-fungible or unique tokens on the Ethereum blockchain. While most tokens are fungible (every token is the same as every other token), ERC-721 tokens are all unique while the ERC-20 is a technical standard used for smart contracts on the Ethereum blockchain for implementing tokens, it defines a common list of rules for Ethereum tokens to follow within the larger Ethereum ecosystem, allowing developers to accurately predict interaction between tokens.

The ERC-721 has been most commonly known in its use in the Cryptokittes dApp and more recently in its applications with MLB card collectibles. Using ERC-721 tokens you can own a piece of art without having the hustles of hanging it up on a wall while at the same time being afforded near-instant liquidity through our decentralized application. We potentially see this as a diversification gateway for cryptocurrency holders looking to hedge their holding without converting back into fiat.

As much as art tokenization will aid cryptocurrency holders diversify their holdings, we believe many of the benefits of tokenization come in the form of authenticating art work through the blockchain. Using the ERC-721 Standard, each art piece that is added onto our marketplace will have a unique digital ID which makes it impossible to replicate and thus the authenticity of every artwork on the dApp will be guaranteed.

Find out more about Stakeey:

Email: hello@stakeey.com

Related posts:

Welcome to my article on picking up the confidence to date women. I’m hoping that this helps some of you out with any ‘problems’ you might be having. There are some basic aspects we must sort out…

We have all heard of the age old wisdom: Change is inevitable. But we barely stop to reflect on it. With the passage of time and my growing interactions in the market, I have truly started to believe…

Conceiving children is not easy and I feel fortunate to have two beautiful children of my own. Unfortunately, I went through two terribly upsetting miscarriages which taught me a lot of respect for…