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https://www.artnews.com/art-news/news/magnus-resch-nft-art-market-interview-web3-1234632602/?fbclid=IwAR28qbufIbsyjeRujhD7zDIxMRKO-yIdPelseI0_2K0Iz8zS5lZJLT0rgTw
Magnus Resch has spent many years decoding the opaque art market for general audiences and academics alike, turning a complicated social dance into a matter of quantifiable clarity with books like Management of Art Galleries and How to Become a Successful Artist.
Resch has a particularly unromantic view of how art operates, as might be expected from an economist, entrepreneur, and Yale lecturer. This data-focused approach makes him an ideal person to cut through the messy world of NFTs. His new book, co-authored with Tam Gryn, How To Create And Sell NFTs – A Guide For All Artists, came out yesterday.
In an interview with ARTnews during NFT.NYC, Resch makes illuminating comments on the similarity of the art and NFT markets, why NFTs will change the way galleries operate, and even makes a prediction on what we can expect of the volatile NFT market over the course of the next 18 months.
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ARTnews: So what drew you into the art market to begin with?
Magnus Resch: In order to fund my studies, when I was in my 20s, I began selling art, which led me to ask why some galleries are successful and other aren’t. This question became the focus of my Ph.D thesis.
ARTnews: And what did you find?
Resch: Success is about everything not related to art. What an artist creates doesn’t really matter for their success. For galleries, all the work they do that is not related to art is what makes the gallery successful. Essentially, success for galleries and artists comes down to the network that they’re in. Who you know is more important than what you sell or what you create.
ARTnews: I was speaking with an NFT collector not long ago who said something similar. He said, “It doesn’t matter what it looks like, if there’s a strong community behind it, I’ll buy.”
Resch: Isn’t the art world the same? The art world thinks poorly of the NFT space, because it’s only about money. Yes, that’s true. That’s the number one reason why people buy NFTs: to make money. But the art world, at least at the top end of the market–and that is a very important distinction–the top end of the market is also all about money.
ARTnews: Yet despite these fundamental similarities, the art world is reluctant to enter the NFT space.
Resch: I was surprised by that. I’ll go to an NFT event and see so few people from the traditional art world running around often, and I wondered why. But I understand; at the beginning, I didn’t like it either. Suddenly, I was surrounded by all these new people, my credentials from the traditional art world didn’t play a role at all anymore. Everything that I had built up over so many years wasn’t relevant. And then there was a whole new technology, a whole new language that I had to learn and understand. That was challenging, but I went on this journey because I was curious, that’s why I wrote this book.
Cover of How To Create And Sell NFTs. Courtesy Magnus Resch
ARTnews: What are some of the key reasons that art world insiders are reluctant to enter this market? Aesthetics?
Resch: It’s never a discussion about aesthetics. There’s a few reasons why I think why they’re reluctant. Firstly, they’re turned off because suddenly works from artists which they have never heard of before are selling for millions of dollars. Secondly, it’s very hard to enter: wallets, Metamask, blockchain, these words alone can be scary to people. And then thirdly, the art world has historically always been slow to adapt to new things. We are happy with the status quo. Let’s just continue with this degree of control.
ARTnews: Do you think the art world can afford to ignore NFTs?
Resch: The biggest problem in the art market is that we have too many visitors and too few buyers, the number of buyers is going down. And why is that? Because buyers are scared to enter the art world. It’s too elitist, it’s not open to first-time buyers. If you don’t manage to convince rookies [to join] into the art world, we will all fail. But NFTs can help solve this issue. Suddenly there are people buying because they had the full transparency of prices and automatic access.
ARTnews: What’s the impact of this for artists?
Resch: What artists are realizing is that they can be successful without galleries, 50/50 doesn’t cut it anymore. Artists can act as true entrepreneurs, finding and creating their own customers, their own distribution channels. We’ve seen a lot of artists who didn’t make much money three years ago are now very wealthy because they took their own career into their own hands, rather than relying on anyone else. Jen Stark and Justin Aversano are good examples.
ARTnews: But do artists really want to have that role? And for all the flack galleries get for dodging buyers and playing games, isn’t that all ultimately in the service of placing artists in the best possible collections and hopefully, institutions?
Resch: It’s true that artists need galleries, and the NFT world also needs them. Most NFTs won’t hold value in the long run because they lack the credibility needed to remain successful. People like Erick Calderon understand it’s important to tap into the traditional art world in order to sustain market value. That’s why he opened the space [Art Blocks] in Marfa and why he has this collaboration with Pace.
ARTnews: Any predictions for how the NFT market is going to move in the future?
Resch: Yes. We will see another short spike, and then a downturn. In 18 months from today, the market will be stabilized.
https://www.artforum.com/slant/alexandra-marraccini-on-nfts-and-the-theater-of-risk-88738
Ethereal Presence
NFTs and the theater of risk
June 16, 2022 • A.V. Marraccini
Screenshot of Shl0ms’s, CAR // 0040, 2022 digital video, color, 1 minute.
At the round earths imagin’d corners, blow
Your trumpets, Angells, and arise, arise
From death, you numberlesse infinities
Of soules, and to your scattred bodies goe,
All whom the flood did, and fire shall o’erthrow,
All whom warre, dearth, age, agues, tyrannies,
Despaire, law, chance, hath slaine, and you whose eyes,
Shall behold God, and never tast deaths woe.
But let them sleepe, Lord, and mee mourne a space,
For, if above all these, my sinnes abound
’Tis late to aske abundance of thy grace,
When wee are there; here on this lowly ground,
Teach mee how to repent; for that’s as good
As if thou’hadst seal’d my pardon, with thy blood.
—John Donne, Holy Sonnet VII
THIS YEAR, the market for cryptocurrencies has plummeted. Bitcoin is down by 56 percent, Ethereum by 63 percent, and the value of stablecoins, most of which are hypothetically pegged to fiat reserve-backed currencies like the dollar, has been severely tested. All told, over a trillion dollars of digital value has evaporated since last fall.
It is a bear market, and no one knows if it will prove to be a season of hibernation, a reprise of the millennial dot-com crash, or something else entirely. In any event, the so-called crypto winter offers space for reflection on what Web3 has wrought, and, for those of us invested in culture and aesthetics, what artists have wrought with it.
To understand the contemporary stakes of the NFT as capitalized art object, it’s worth returning to a much older source: Michael Fried’s long-canonical anti-Minimalist invective of 1967, “Art and Objecthood.” For Fried, “theatricality” famously referred to the setting, circumstance, and experiential variables and frameworks that displaced the modernist centrality of presence in art. Debates about Fried’s essay are themselves now historical material; my intent here is not to recapitulate them. Rather, in the face of a new rupture in artmaking—that of cryptoart and the nonfungible token—I seek to turn Fried’s theatricality back on itself, as other critics have done before the blockchain, and to highlight it as the central feature of these new phenomena.
Smart contracts, such as ERC-721 on Ethereum and FA2 on Tezos, are portions of code that dictate interaction with the blockchain’s permanent ledger; specifically, they detail the transfer of the token from one wallet to another, along with the funds for purchasing it. Thus, whatever digital form the NFT ultimately takes, be it a JPEG image, moving GIF, audio file, or 3-D model, it consists of at least two media: the para-medium of code that constitutes the smart contract wrapper, and the file “inside” it. Through the para-medium or wrapper of the smart contract, all NFTs become a kind of performance of exchange. Those that reference their own status as theatrical objects are, I argue, often the most philosophically provocative pieces of cryptoart, accentuating their role—like that of all NFTs—as financialized instruments. Further, I want to propose that this new form of theatricality presents an intriguing alternative to the concept of “grace” Fried associates with a modernist purity of form—that the theological implications of Fried’s text serve as an unintended window into a new troubled and troubling grace of the coded medium.
In cryptoart, the saying often goes that code is law, but what if it is, in fact, a kind of theology?
That the NFT is not a viable form without the smart contract wrapper makes it an inherently financial instrument—which some take to mean primarily and directly a vehicle for speculation and profit, a stereotype reinforced by last year’s record-breaking auction sales of aesthetically negligible NFTs from the Bored Ape and CryptoPunk collections. The theater of exchange symbolized by these sales, along with that imbricated in the code of any NFT, is of course not intended to problematize the category of art or experience in any interesting way. When it is, however, the conceptual value of the wrapped medium and para-medium becomes evident. Consider the piece Kudzu, deployed on the Ethereum blockchain on April 20, 2021, by Billy Rennekamp, Dan Denorch, Everett Williams, and Sam Hart via Folia. Kudzu calls itself “the first NFT virus” and deploys itself to any wallet that interacts with a wallet that already holds it. Kudzu’s smart contract meets the ERC-721 standard; it calls up a “buyer” and “seller” and transfers a token between them. That token, however, is by design, always free.
The Kudzu themselves are kawaii pixelated squares with faces filled in green in reference to the invasive vine after which they are named. These inherit unique features, such as winking or heart eyes, smiling or vomiting mouths, and varying color accents, partly from the infecting wallet and partly from a pseudorandom hash function that is standard to the blockchain. These mimic the “rarity” features and design styles of many commercially valuable NFT projects, with the irony being, of course, that the infectious image cannot be priced at all. Like the profile pictures of ubiquitous “pfp” projects,” Kudzu token images are almost always traded at a 1:1 ratio—a wallet can only be infected once. Kudzu thus retains the theatrical structure of the exchange of funds the smart contract is designed for, and enacts its gestures rhetorically, but voids them of actual capital. Here, recursive theatricality is the means by which Kudzu critiques its own media and the hyperspeculative milieu that surrounds them.
Image from the digital announcement for Kudzu, 2021, an “NFT virus” created by Billy Rennekamp, Dan Denorch, Everett Williams, and Sam Hart.
Whereas Kudzu’s audience has to understand the technical nature of the blockchain—and the frenzied purchasing culture of cryptoart on the whole—to grasp the piece’s subversive reflexivity, other cryptoart makes the theater of turning capital back on itself more explicit, or—in the case of the $CAR project by the pseudonymous “crypto-dadaist” Shl0ms—literally explosive. In early February 2022, Shl0ms purchased a Lamborghini Huracan, the favored vehicle of the techno-bro crypto-elite, and drove it into a desert somewhere in the American Southwest. Then, they exploded it in a controlled blast. The work comprises: a hybrid documentation/promotion/art video of the detonation process (featuring references to Picasso and the perceived masculinity of bulls and bullfighting, segments associating the desert where the car was blown up with the American atomic bomb tests, among other imagery); 999 short films of pieces of the exploded car, each wrapped in ERC-721 contract code; the auctions of those pieces, and the affective reaction of buyers to the car’s actual and financial fractionalization as expressed through tweets, bid attempts, and Telegram messages, often in deeply emotional language.
The auction for $CAR began on February 25, 2022, and was, by design, a protracted affair. The artists deployed their contract from their own website, making it possible to extend the bidding past an initial twenty-four hours if the top fifty bidders changed order in the last ten minutes. The ensuing days-long competition riveted the NFT community and provoked debate about the auction as a theatrical event. The NFTs of the destroyed car parts sold for more than new Lamborghini would.
Promotional video for Shl0ms’s $CAR, 2022.
The $ in $CAR’s title is typically reserved for currencies on specific blockchains, or layers of blockchains, often associated with particular projects, artists, or protocols. $ASH for instance, is the proprietary token of artist Murat Pak. Ethereum or Tezos are denoted by $ETH or $XTZ. No such token was issued for $CAR, so it is purely symbolic, signifying that Shl0ms anticipated the speculative financial value the pieces would come to represent on their own after auction. Shl0ms has a history of conceptual work, including selling an “empty” transparent PNG file, but $CAR succeeds beyond the scope of these other pieces because it leans into its own situational framing and absurdity, using the financial instrument of the NFT to comment on the financial instrumentalization of art. Perversely, this is the kind of self-interrogation Fried enjoys in modernist painting, but in the case of Shl0ms’s $CAR, the object being interrogated is itself a non-object: namely, the theatrical setting of the market that makes the piece possible.
Of course, the hyper-capitalization of NFTs is in large part responsible for the distaste they have inspired in the contemporary art world, but it is paradoxically what also enables them, combined with the implicit theatricality conferred by the para-medium of the smart contract, to turn back and effectively critique the forms of capital that they embody. Contra Fried’s famous pronouncement—“Presentness is grace”—$CAR and Kudzu are predicated on absence and destruction, respectively. Kudzu is monetary exchange without money. $CAR is the process of breaking up a car into physical remnants, which acquire new meaning and value through processes of digital representation and transactional circulation. There is no single, revelatory gaze, no one moment of total absorption or comprehension. The theatricality of the exchanged tokenized object in the volatile market holds none of the surety one expects from grace. The self-reflexive NFT that employs the theater of absentness suggests that if art offers grace at all, it is volatile, conditional, and inseparable from the systems of capital under which it operates.
Promotional video for Shl0ms’s $CAR, 2022.
In the epigraph of “Art and Objecthood,” Fried invokes the religious thought of eighteenth-century Puritan preacher Jonathan Edwards as a metaphor for the sublime presentness that art, freed from the contamination of “theatre,” can offer. Specifically, Fried is interested in Edwards’s continuous experience of the world as ongoing evidence for the existence of God. But for Edwards himself, and all Puritans, the 1658 Savoy Declaration makes clear that no matter the circumstantial reinforcement, the word of God alone is the source of grace. That is, the image is only secondary. Consider one of the short videos from $CAR, of piece 0040. It shows the Lamborghini’s roof as it rotates against a black background. Light grazes the edges and peaks of the crumpled metal, as if it were the body of Christ in a chiaroscuro Deposition. Its detonated form has a kind of exquisite brokenness.
In cryptoart, the saying often goes that code is law, but what if it is, in fact, a kind of theology? The physical piece 0040 presumably still belongs to Shl0ms, who perhaps has it nestled in a warehouse somewhere. This is what the viewer believes. The smart contract wrapped around the video of piece 0040 is an assurance that the viewer owns the documentation of this object. If word alone was enough for grace in art, as it is with Edwards’s God, the coded contract would be the primary and perhaps only medium here. But it isn’t. In the little bounded theater of the browser window, the serrated edge of the torn roof piece scrapes against velvety black. The Ethereum ledger records the price of sale at the equivalent of $9,031.14. Perhaps it will be sold again, gain or lose value as a speculative asset. Grace in the tradition of Jonathan Edwards is given by God freely for repentance and made possible by the sacrifice of Christ at the Crucifixion. Grace in the tradition of Friedian high modernism is given by the material transcendence of the work of art. Shl0ms returns us, via the theatre of exchange, to this central question of experience, to ask if grace itself is transactional, and if so, what should be its price.
A.V. Marraccini is an essayist, critic, and art historian based at the international Bilderfahrzeuge Project at the Warburg Institute in London. Her first book, We The Parasites, is forthcoming from Sublunary Editions in February 2023..