NFT #4: NFTs might not be as hacker-proof as you thought

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The unmasking of the identities of two of the Bored Apes Yacht Club founders, by the Buzzfeed News columnist Katie Notopolous, originated an extremely animated discussion about anonymity in the crypto world.

Source images courtesy Bored Ape Yacht Club

Anonymity in the blockchain technology had the purpose to guarantee privacy in the intermediaries free transaction environment, but it became more than that, meaning a way to freely express creativity and opinions in online platforms, obviously, with the drawbacks that this could bring to the table (after Notopulos shared her discovering, some people even become violent hidden behind alter- egos).
Setting apart the ethical and social issues that this discussion brought up, my point is to highlight not only the fragility of this new system that is considered untouchable from the flaws of human being and society, but also the solutions arising from the art world itself.

Camilla Simoncini, D[AVID] n.1 - Cigarette 2022 | available here on Artsted

The idealized version of NFTs

Behind NFTs, crypto-art, and avatars there are humans, which need to comply with laws of the physical world. In this realm, one of the main legal issues is copyright.  Artsted is an artwork nft marketplace.
Theoretically, NFTs are in fact able to guarantee at the same time the authenticity of a work and the anonymity of both artists and buyers. NFTs are a way to distinguish the original to the copies, while allowing everyone to copy and share the works. In addition, with the blockchain technology, each transaction is traced in a digital ledger, creating a secure list of owners (always maintaining their anonymity, thanks to the use of pseudonyms). But things are not that easy...

The pessimistic version

In the last weeks the issues of copyright and the overall function of NFTs was discussed by 137 minute long YouYube video by Dan Olson, “Line Goes Up — The Problem With NFTs,” a critique on NFTs that has gone viral.
On the one hand, the critique on the artistic value of NFTs, can be easily refuted by the importance and value that the overall art system, from Christies to major artists in the scene (Damien Hirst, Daniel Harsham and many others); on the other hand Olsen brought to light some valid concerns about the essence of NFTs:

  • NFTs don’t qualify for IP protection since the process of creating an NFT is not a creative act (but the underlying work is, and this can strengthen artists’ rights associated with the digital art they are minting).
  • The range of actions a nft owner is entitled to do is limited because they have property rights over a specific copy, therefore they don’t own reproduction rights. This is a problem whenever they want to share or display the work,since in the digital world any time an image is viewed a copy is created.
  • Authenticity of crypto-art is challenged by the fact that blockchain needs to guarantee privacy and anonymity to its users, who are often unaware of the mechanisms of intellectual property rights.

The glass half full

These issues are real, but they are not a sufficient reason to stop investing in something that is unlikely a soon-to-be-over trend. The solution comes withing the art system: young startups and projects aiming at creating a new order in the NFTs chaos; the new pillars of the digital art system who will decide the destiny of the next generation of artists and maybe will discover the next Beeple.

In the end, the problematic issue is that originally, no one was including copyright in the equation, and this led to the issues we are now facing, as soon as more and more people started investing their own money in this kind of art. But acknowledging that no one is above the law, regardless of their anonymity, is the first step to build an actually secure system.

Art-centered online platforms, like Artsted, can offer artists an easy way to create NFTs of their work, embedding in the blockchain all the information necessary to comply with the law and guarantee authenticity to the work. At the same time, they can keep a register of all transactions, allowing buyers and users to always have access to the chain of title, and knowing who the owner of a particular NFTs is.

an NFT made by Nicolas Crocetti, Intimate dinner with anxiety, I fast, she devours me | availble here on Artsted
Written by
Alice Asia Bergagnin