In October 2020, Miamibased art collector Pablo RodriguezFraile spent almost 67,000 on a 10second video artwork that he could have watched for free online. Last week, he sold it for 6.6 million.
The video by digital artist Beeple, whose real name is Mike Winkelmann, was authenticated by blockchain, which serves as a digital signature to certify who owns it and that it is the original work.
Its a new type of digital asset known as a nonfungible token NFT that has exploded in popularity during the pandemic as enthusiasts and investors scramble to spend enormous sums of money on items that only exist online.
Blockchain technology allows the items to be publicly authenticated as oneofakind, unlike traditional online objects which can be endlessly reproduced.
You can go in the Louvre and take a picture of the Mona Lisa and you can have it there, but it doesnt have any value because it doesnt have the provenance or the history of the work, said RodriguezFraile, who said he first bought Beeples piece because of his knowledge of the U.S.based artists work.
The reality here is that this is very, very valuable because of who is behind it.
Nonfungible refers to items that cannot be exchanged on a likeforlike basis, as each one is unique in contrast to fungible assets like dollars, stocks or bars of gold.
Examples of NFTs range from digital artworks and sports cards to pieces of land in virtual environments or exclusive use of a cryptocurrency wallet name, akin to the…