Anthony Masure

chercheur en design

Making the Multiple Singular: Artistic NFTs, Speculation and Redistribution

Contexte

Paper written with Guillaume Helleu for the research journal Multitudes, which will appear in November 2021. Translated from French by Aviva Cashmira Kakar.

Résumé

This paper explores the issues concerning blockchain technologies within the realm of the creative (art, design, video games, etc.), which have arisen since the development of non-fungible tokens (or NFTs) in 2015. NFTs are essentially the production of a decentralized digital certificate that is impossible to forge, which is then linked to a numerical or tangible entity. NFTs have emerged into the mainstream since the beginning of 2021 due to a massive surge in sales and the development of specified marketplaces. NFTs have brought to the fore a variety of issues concerning value, circulation, and the exposure of artistic and cultural productions.

Among the major technologies that have arisen since the end of the Second World War, blockchain (2009) technology, whose most iconic example is Bitcoin, has remained largely misunderstood beyond its basic monetary applications. Nevertheless, since 2015, this technology has begun to have a substantial impact upon the creative disciplines (art, design, video games, etc.) through the development of non-fungible tokens (NFTs), units of data stored on digital ledgers called a blockchain, which generates a certificate that is unique and tamper-proof, and is attached to a tangible digital entity. Unlike the concept of the Creative Commons and free culture, the promise of NFTs lies in the creation of “digital rarity”: without them, once a given image, video or film is put online, it can be duplicated and circulated with no real possibility of control. NFTs emerged into the spotlight in the beginning of 2021 with a series of record sales (such as the $69 million sale of a work by the artist known as Beeple), as well as the development of specific marketplaces. They raise several issues related to artistic and cultural values, circulation and exposure.

From Bitcoin to Ethereum: Programming Trust

Bitcoin was the outgrowth of an anti-establishment political movement that sought to prove that the banking system, currently vulnerable to several crises, can be replaced by a computerized protocol without the need for a trusted third party. 1 Guillaume Helleu, Anthony Masure, “Total Record: Les protocoles blockchain face au post-capitalisme,” Multitudes, 71, 2018, https://www.anthonymasure.com/articles/2018-05-total-record-blockchain Bitcoin works through a digital ledger referred to as a blockchain which is distributed on the network and contains a transactional history. The calculating power of the machines that enable the verification of the transactions makes blockchains irreversible and impermeable to forgery. For the first time, blockchain has made it possible to produce “unique” digital artifacts, as opposed to the blurring lines between copies and originals that is endemic to the digital world. This privatizing device opens the way to lending an economic value to digital files that is not generally applicable.

While Bitcoin has consistently garnered its share of media attention, generally when it has been used for criminal ends (ransomware, illicit trafficking, and the like), financial speculation or energy consumption, it is but one of thousands of crypto assets that have since been developed, some of which are particularly distinctive from a technical standpoint. Unlike Bitcoin, which is limited to its financial aspect, Ethereum (2015) also enables one to program any digital value that can be exchanged online. This platform offers new protocols, such as smart contracts (automatic generation of scripts), DApps (decentralized applications), initial coin offerings (ICOs), and tokens (secure digital units). Blockchains that have been created in the wake of Ethereum are no longer developed to create yet another currency, but rather to provide new functionalities, linked for example to governance (NEO, 2017), or traceability (Chainlink, 2017).

Fungible and Non-Fungible Tokens (NFT)

The common trait of the tokens that form a blockchain is that they cannot be duplicated or counterfeited. Like Bitcoins or Ethers, tokens can be exchanged on the network without the intervention of a traditional trusted intermediary (bank, lawyer, etc.). Tokens have several uses, which can, according to the situation, add up 2 Michael Lewrick, Christian Di Giorgio, Au cœur de la Blockchain. Explorez le nouveau champ des possibles, (Paris: Payot, 2019):

Remuneration for traditional goods or services (transactional tokens), used in the same manner as currency generated by states or local tender. These tokens can be conceived to only work within a given context, for example within the platform of an online e-commerce network, a time slot (e.g. a concert), and/or a geographical territory (as one might consider the e-Yuan).

Remuneration for the use of crypto-platforms and their associated services (utility tokens), for example the release of an Ethereum smart contract. These tokens are primarily used to compensate the miners of a blockchain in which the service is implemented.

Administration and management of organizations (governance tokens) such as businesses, associations, communities, etc.: the materialized token here represents a right to vote, or at least decision-making power.

Authentication of a tangible or digital product (security tokens): Some of these tokens might be interchangeable (or “fungible”), and represent say, a seat at a concert, a unit of financial stock, etc. Others, on the contrary, are unique, and thus are referred to as “non-fungible” tokens, or NFT; they are used to authenticate rare items through the emission of certificates of authenticity (such as for works of art, etc.). Fungible tokens can be exchanged on a trading platform such as Binance, where one token equals another, whereas non-fungible tokens (NFTs) can be found on specialized marketplaces like OpenSea.

From a technical standpoint, NFTs are made up of blocks of information that contain metadata (author, signatures, dates, type, etc.) that are attached to a tangible or virtual item of value. The first area in which NFTs made their appearance was in the legal and financial sectors, when it became possible to “tokenize” traditional financial instruments (such as stocks, debt, investments, etc.) in a blockchain. These crypto assets enabled one to conduct decentralized “peer-to-peer” transactions, which possess several advantages: wider geographic and temporal viability (as opposed to traditional markets), a higher degree of transparency (the data ledger being public), as well as a higher level of technical efficiency, such as the automatic payout of dividends via a smart contract.

The Challenge of Digital Reproductiveness in Artistic and Cultural Economic Spheres

Since the development and expansion of the Web around 1993, digital environments have eroded traditional notions of value attached to rare or unique tangible items. Consequently, from both an economic and symbolic standpoint, the question of whether or not to maintain this paradigm of rarity in connected digital environments arose, giving rise to the technical reproduction of works of art that resulted from the mainstream appearance of instruments like digital and video cameras. 3 Walter Benjamin, “The Work of Art in the Age of Mechanical Reproduction [1939],” Illuminations, Hannah Arendt, ed., Harry Zohn, trans., (New York: Schocken Books, 1969); Pierre-Damien Huyghe, Le Cinéma Avant Après, (Grenoble: De l’Incidence, 2012). In point of fact, it is the very nature of digital media not only to simulate and remix any other media, but also to be able to duplicate data. 4 Lev Manovich, The Language of New Media, (Cambridge: MIT Press, 2001).

The advocates of the free circulation of digital content uphold the principle that it is politically and/or technically useless to oppose such duplication. Several propositions have been put forward: the use of “free” licenses, in order to enable granular uses (the Creative Commons organization was founded in 2001 by attorney Lawrence Lessig to address this); directly linking the value of digital items to tangible goods or events (prints, goodies, concerts, exhibitions, etc.); the establishment of a “global license” in 2001 that was based upon the principle of a tax that was redistributed to artists, donation campaigns, or the rise of institutions for community contributions, such as crowdfunding (2006).

On the other hand, proponents for the monetization of digital cultural works and content invented a range of strategies for their control and distribution. An initial approach consisted of singularizing digital files to attempt to make the distinction between a copy and an original work. The first forms of digital signatures appeared in the 1980s but, on the downside, they were dependent upon proprietary systems. In the wake of the massive success of such platforms as Napster (1999), Pirate Bay (2003) and YouTube (2005) where copyright-protected files were shared, governments and corporations began to implement a variety of surveillance systems and sanctions (Digital Millennium Copyright Act, 1998; DADVSI, 2006; Google Content ID, 2007; HADOPI, 2009). Another solution for protecting the economic viability of digital productions was the development of commercial platforms that enabled one to easily acquire consultation licenses, either “per view” or through subscriptions, to access music, films, video games, applications, etc. (Pandora, 2000; iTunes, 2001; Spotify, 2006; Netflix, 2007; the Apple App Store and Google Play, 2008; Kindle Unlimited, 2014; Xbox Game Pass, 2017). Within this ecosystem, right of use becomes non-transferable and is accorded for a limited time only it comes to an end when the subscription in question ends, or ultimately with the death of its holder. 5 Guillaume Champeau, “Bruce Willis n’attaquera pas iTunes, en fait,” Numerama, 2012, https://www.numerama.com/magazine/23584-bruce-willis-n-attaquera-pas-itunes-en-fait-maj.html NFTs can offer an end to this limitation by guaranteeing a transmissible right of access (through inheritance or resale, etc.).

These traditional guidelines show that the concept of an original does not antedate that of a copy, but only really makes a major appearance when technology reaches the point of making mechanized reproduction possible. From a legal standpoint, the notion of an “original work” appeared over a century ago in French law with the establishment of the Artist’s Resale Right (droit de suite), and remains unstable, obsolete even, considering the multiplicity of art forms and techniques, from the limited print runs of photographs or cast-iron sculpture reproductions of yesteryear to today’s performance and digital arts, to name but a few. 6 Jean Aittouares, “Des reproductions très originales,” Gazette Drouot, 2016, https://www.gazette-drouot.com/article/des-reproductions-tres-originales/8982 Moreover, many art forms directly challenge the notions of original and copy: some that come to mind are Minimal and Conceptual Art (1965), Land Art (1968), or Net Art (1995).

Art in the Era of Internet Pop Culture

Today the art market is largely dominated by fairs and galleries, such as ArtPrice (1997) or auction houses such as Christie’s and Sotheby’s. The parallel development of social media (Facebook, 2004; Twitter; 2006; Instagram, 2010; TikTok, 2016) has provided artists with the possibility of forging a direct link with their public, thus increasing their visibility. Fundamentally speaking, the development of social media brought about a situation in which the economic value of a work is no longer solely based upon traditional spaces of legitimization (galleries, museums, art centers), but also by its degree of online transmission, say in the form of likes and retweets. Facebook invented the “like” in 2009 as a proposed alternative to the hyperlink (URL), thus seeking to quantify attention and emotion generated. 7 Olivier Ertzscheid, “Le like tuera le lien,” Affordance, 2010, https://affordance.typepad.com/mon*weblog/2010/05/le-like-tuera-le-lien.html This created a degree of tension between “artistic valuation,” defined by researchers Yves Citton and Anne Querrien as a tension between “artistic valuation” (defined by researchers Yves Citton and Anne Querrien as the constituent process of actively increasing the value of a specific area of perception, and the augmentation of commercial value; that can potentially be amplified by viral dynamics). 8 Yves Citton, Anne Querrien, “Art et valuation. Fabrication, diffusion et mesure de la valeur,” Multitudes, 57, 2014, 7–19. Quote translated directly from the French but an English version of the article is available: https://www.cairn.info/revue-multitudes-2014-3-page-7.htm Any popular digital item that is massively “liked” and “shared” can become a work in its own right: this directly brings to mind the meme culture that became predominant at the end of the 1990s. The “informed” art collector of the past is replaced by a crowd of more or less anonymous individuals swimming in the current of a digital environment where the borders between art and pop culture are porous to say the least.

Within this context, NFTs not only facilitated the sale of “traditional” artworks, but would also and above all, even confer a market value upon a multitude of digital artifacts. From 2015 onwards, before the appearance of NFTs, the symbolic legitimacy of the digital artifacts of Internet culture (memes, tweets, Instagram posts, gaming assets, bits of music, program source code etc.) were impossible to link to a specific financial counterpart because it was impossible to commercialize something whose value was established by the facility of its reproduction and the degree to which it was distributed. NFTs fill this crucial need by enabling one to identify (and thus remunerate) the author of a digital artifact through a public key certificate of ownership that is distributed throughout the network. Additionally, NFTs facilitate the purchase of digital artifacts since they can then be acquired with cryptocurrencies, whose advantage is that they are native to the Internet, and do not entail conversion fees, and are resistant to inflation and censorship. 9 Ludovic Lars, “Bitcoin est-il une pyramide de Ponzi?”, Journal du Coin, August 2021, https://journalducoin.com/bitcoin/bitcoin-est-il-une-pyramide-de-ponzi)

Two trailblazing initiatives, CryptoPunks and CryptoKitties, have utilized blockchain’s capacities to make digital images “unique” through signature. CryptoPunks (Larva Labs, 2017) is a set of 10,000 24×24-pixel images that are a shout-out to the 8-bit retrogaming esthetic. CryptoPunks are distributed for free through the Ethereum platform and were the inspiration behind the creation of the ERC-721 technical standard in 2017 concerning NFTs: they are henceforth considered to be high-end digital works. 10 Alice Robert, “Natively Digital. CryptoPunk 7523,” Sotheby’s, June 2021, https://www.sothebys.com/en/buy/auction/2021/natively-digital-cryptopunk-7523/cryptopunk-7523 CryptoKitties (Axiom Zen, 2017) features unique collectible digital kittens that can reproduce. These productions have subsequently garnered record sums, partly because of the soaring values of cryptocurrencies in recent years. 11 Andrew R. Chow, “NFTs Are Shaking Up the Art World—but They Could Change So Much More,” Time, March 2021, https://time.com/5947720/nft-art In June 2021, the CryptoPunk Alien was sold by Sotheby’s to Shalom McKenzie (the largest shareholder of an online betting operation), and, on a more institutional level, Visa acquired the CryptoPunk #7610 for $150,000 in August 2021. In September 2018, the CryptoKitty Dragon was sold for 600ETH ($170,000). According to Bryce Bladon, the co-founder of the Axiom Zen studio:

“All of these cats are collectibles and one of the world’s first examples of digital art that a user can truly own. It may seem silly to see someone spend thousands of dollars on a digital cat, but it’s not that different from someone spending thousands of dollars on some canvas stained with oil paint.” 12 Simon Chandler, “‘CryptoKitties Are Digital Art’: Talking Cats, Crypto with Axiom Zen,” CryptoNews, March 2018, https://cryptonews.com/exclusives/cryptokitties-are-digital-art-talking-cats-crypto-with-axio-1326.htm

In the increasingly connected lives we lead, collecting an NFT to use as an avatar becomes an impressive social marker. 13 Kyle Chaika, “Why Bored Ape Avatars Are Taking Over Twitter,” The New Yorker, July 2021, https://www.newyorker.com/culture/infinite-scroll/why-bored-ape-avatars-are-taking-over-twitter While one’s online identity is generally summed up by a profile image and a pseudonym, the property certificate of an NFT, such as a CryptoPunk avatar for instance, lends an added element of distinction that continues to grow in importance. Since the appearance of single sign-on providers (Facebook Connect, 2008; Google Sign-In, 2015; Sign in with Apple, 2019), identification on the Web has been simplified even as the interconnection of data has increased (status, profile photo, age, etc.). The MetaMask (2016) crypto wallet works on the same principle but in a more decentralized way. It is associated with the collab.land program (2020), and enables one to certify ownership of an NFT. Logging in with MetaMask could become a new standard means of connection on the Web.

After the Covid crisis sparked massive online exchanges, 2021 has been a period filled with numerous debate over financial speculation (DEFI, or “DEcentralized FInance”) and the vigorously expanding cryptocurrency market, and examples of NFTs headlining in mass media have proliferated. In December 2020, a portion of the circuit in the video game F1® Delta Time was sold for € 223,000 (its owner passively acquires income through other players); a video clip of basketball star LeBron James was sold for $100,000 in January 2021; an image of actress Lindsay Lohan was acquired for $17,000 and resold for $57,000; in February 2021, the Nyan Cat meme was commercialized by Chris Torres for $300,000 (300 ETH); in March 2021, the first tweet ever published was sold by Jack Dorsey for $2.9 million; in April 2021, McDonald’s put up twenty NFTs of their promotional videos on the OpenSea platform, and in June of 2021, the open-source code of the Web was auctioned off at Sotheby’s by its creator, Tim Berners-Lee, and went for the sum of $5.4 million.

CryptoArt Platforms

Auction houses such as Sotheby’s and Christie’s have used the NFT fad to increase their bottom line. The most notable example is the Christie’s sale, in March 2021, of the work Everydays by the artist known as Beeple for a cool $69 million, placing it in the top three highest art sales of the work of a living artist. It was purchased by an investor based in Singapore who made their fortune on cryptocurrency. This digital collage is made up of 5,000 images posted by the artist on Instagram (Beeple has around 2.5 million followers) over the last fourteen years some of the posters have been made in collaboration with the likes of Vuitton, Nike, and Katy Perry.

While most of the sales of artistic NFTs concern artists who are little known outside of social networking circles, one can nevertheless observe an exponential increase in initiative from players who have already gained legitimacy in the traditional art world. 14 For a valuable and detailed chronology of artistic NFTs, please see: Aude Lenay, “Ce que la tokenisation fait à l’art,” in The Great Offshore, RYBN, ed., (Paris: UV, 2021), 319-337. For instance, the artist Damien Hirst announced the launch of his project The Currency in July 2021. It consists of a series of 10,000 unique physical artworks inspired by banknotes: after a period of two months, buyers have to choose whether they wish to keep a physical copy of the artwork they acquired (for $2,000), or as a virtual NFT (stored on the Palm blockchain, a token-powered ecosystem. Another example of the tension between “artistic valuation” and “commercial value”: in June 2021, digital art pioneer Fred Forest auctioned off an NFT work entitled Archeology (a reprise of his work Parcelle/Réseau created twenty years ago), whose upset price is consistently adjusted in real time so that it is always set to one US dollar more than any other NFT previously acquired.

Artists have formed a community called CryptoArt, where they can explicitly position their activity through the sale of NFTs. Most are “emerging” artists (such as Kathryn, Swan, FEWoCIOUS, Hackatao, to name a few) who are very committed to their links with their fan base. Their productions are exchanged on specific platforms for the sale of artworks and/or collectibles, most of which are based on Ethereum (SuperRare, 2018; Nifty Gateway, 2018; OpenSea, 2019; Palm, 2021; Binance, 2021; Shopify, 2021). Other, more “established,” artists (Memo Akten, Joanie Lemercier, Golan Levin, and the like) have opted to distance themselves from these platforms, deemed as “generalized” and little concerned with ecological issues, and have come together to create their own commercial spaces such as the open-source platforms Hic and Nunc (2021). This has enabled them to claim independence from the traditional art world and is rooted in a political impulse to take control of the distribution chain, both from a technical standpoint (with interactive or animated NFTs), and to reduce the commission fees and energetic costs of such transactions: Hic and Nunc for example, is based on the Tezos blockchain, created in 2018, which consumes far less energy than Ethereum). Apart from attracting new buyers from the technological sphere, uncurated NFTs platforms serve to lend value to artists who are habitually marginalized in the art world, often due to their geographical provenance (e.g. South America, Asia, etc.). 15 Lev Manovich, “My Notes on the NFT Art Phenomenon,” Facebook, June 2021, https://www.facebook.com/lev.manovich/posts/10160336091277316

Summary of the Issues Surrounding NFTs

The financial fascination for NFTs has engendered intense media exposure as well as a polarization of the art world. 16 Baptiste Condominas, “Crypto-Art: pourquoi les NFT divisent la communauté artistique,” RFI, July 2021, https://www.rfi.fr/fr/culture/20210731-crypto-art-pourquoi-les-nft-divisent-la-communaut%C3%A9-artistique Consequently, it is difficult to gain a nuanced reading of the issues surrounding them. Our initial conclusions are as follows:

Authentication. Blockchain enables one to create a unique, tamper-proof digital signature, thus countering computer code’s capacity for being duplicated, shared and modified. The case of “natively digital” productions (image files, tweets, elements from video games, etc.) is a particularly interesting one because there is no device that is comparable to NFTs that would make it possible to make them “unique” or “original” works, similar to say, photographic art print runs, released in limited numbered series. Nevertheless, the authentication certificates are linked to the platform upon which they are acquired, which raises potential trust issues for instance, the same file could be sold with the authorization of the artist and/or on two different platforms. There is also the question of durability: URLs that link to the works can change, unlike the rare on-chain NFTs where works are entirely stocked within a blockchain. 17 Jamie Redman, “NFT Criticism Heightens: Skeptic Calls Tech a ‘House of Cards,’ Claims NFTs Will be ‘Broken in a Decade’,” Bitcoin.com, March 2021, https://news.bitcoin.com/nft-criticism-heightens-skeptic-calls-tech-a-house-of-cards-claims-nfts-will-be-broken-in-a-decade

Disintermediation. Blockchain’s ability to cut out the need for third-party mediation of a transaction enables artists to come together to create their own sales platforms, thus emancipating themselves from the traditional art world, with its gallery commissions and the limitations of exhibitions. Still, online platforms, even self-managed ones, do constitute another intermediary, since the NFT is correlated to the degree of legitimacy of the platform and blockchain that supports it.

Redistribution. The great majority of platforms remunerate artists for multiple sales via smart contracts. One platform, SuperRare, takes a 15% commission on their sales, and secondary markets enable artists to obtain a retro-commission of 10%. Also worthy of mention is the emergence of services dedicated to the second marketplace for NFTs, such as eBay who, in May 2021, created a dedicated section for digital and cryptographic collectibles.

Pollution. Some artists (Memo Akten, Joanie Lemercier, Jacqueline “Jisu” Choe) have drawn attention to the energy drain of data encoding in Ethereum. 18 “The Uncanny Valley. Episode V. Toward a New Ecology of Crypto Art: A Hybrid Manifesto,” Flash Art, February 2021, https://flash—-art.com/2021/02/episode-v-towards-a-new-ecology-of-crypto-art This could however be more nuanced in the case of blockchains that require less energy, such as Tezos (2018), which uses the proof-of-stake protocol. The Hic and Nunc platform (2021) consequently refers to their sold productions with the hashtag #CleanNFT.

Programming. Blockchains enable one to program currency, shares, etc., all of which make the creation of new economic scenarios and models specific to a particular work or service possible. 19 Antoine Verdon, “Blockchain et nouvelles espèces numériques,” Le Temps, November 2017, https://www.letemps.ch/economie/blockchain-nouvelles-especes-numeriques As a result, several artists have highlighted the paradoxes endemic to blockchains and NFTs, with, on the one hand, its promise of equity and responsibility, and, on the other, implementations that are often quite capitalistic in nature. 20 Ruth Catlow, Marc Garrett, Nathan Jones, Sam Skinner, Artists Re:Thinking the Blockchain, (Liverpool: Torque / Furtherfield, 2017). Also see the New Kids On The Blockchain encounters organized by Marie Lechner, Anthony Masure and Clémence Seurat at the Gaîté Lyrique (Paris) from November 2018 to June 2019, sponsored by the DICRéAM : http://blockchainkids.xyz Plantoid (Primavera De Filippi, 2016), highlights machines capable of reproducing themselves through the use of smart contracts and which act as DAOs (Distributed Autonomous Organizations), or Terra0 (Paul Kolling, Paul Seidler, Max Hampshire, 2016), whose aim is to create an “augmented” forest in Germany which one can enter and leave using smart contracts.

From CryptoArt to CryptoGaming: Play-to-Earn

Artworks in the form of NFTs reveal the ambiguities inherent in blockchain technologies: their speculative nature leads to implementations that are often strongly capitalistic even if their accessibility and decentralized nature are promising as factors for equitable and responsible use. Their possibilities are vast and are as yet largely untapped on the online sales platforms that offer NFTs since blockchain use is often limited to that of a distribution system. 21 See Jesse Damiani, Proof of Art: A Brief History of NFT’s, from the Beginnings of Digital Art to the Metaverse, exhibition (10 June–15 September 2021), Linz, Francisco Carolinum, https://www.cryptovoxels.com/events/345 and Ruth Catlow, Cadence Kinsey, Rob Myers, Studio Hyte, A Blockchain Art History Timeline? A Feasibility Study, (Furtherfield: UCL, 2020). See also Aude Launay, “Another Block in the Chain” in André Hemer, The Imagist & the Materialist, (Vienna: Painting Diary, 2019).

The true economic potential of NFTs might however emerge not in the realm of art which, until now, has garnered the most media attention, but rather that of video gaming. In fact, gaming is by far the primary cultural sector from an economic standpoint: in 2021 it has generated $300 billion with an estimated 2.7 billion players. The sector has undergone several mutations over the last years, which has made it a crucible for the observation of more sweeping societal changes: subscriptions, streaming, and micro-transactions (such as DLC and loot boxes, e-sport, etc.). 22 “Video Games and their Brave New World,” Three Body Capital, July 2021 https://threebody.capital/blog/2021/7/30/video-games-and-their-brave-new-world

There is a key instance that will enable us to better understand the possibilities NFTs have in terms of gaming. In 2018, Axie Infinity (Sky Mavis Studio) was launched by CryptoKitties fans based in Vietnam and the Philippines. It offered the chance to purchase and collect, trade and battle NFTs of digital creatures (Axies) that resemble little Pokemons. Unlike traditional video games where gaining access is contingent on spending a sum defined by the publisher, here the player is required to acquire at least three Axies from a dedicated marketplace, where the prices are defined solely by supply and demand (in July 2021, the minimum price for an Axie was $350, with some going for as high as $240,000). 23 Disclaimer: the authors of this paper acquired several NFTs from the game in order to better understand how they work and the economic model overall. As of the first quarter of 2021, Axie Infinity has rapidly grown into the main platform for the exchange of NFTs, attracting over a million players.

As they play, users generate (or “mine”) game tokens called SLP (Smooth Love Potions) or Axie Infinity Shards (AXS). As of August 2021, this activity, referred to as “play-to-earn,” can earn up to twenty-five dollars per day for a few hours of gaming, which amounts to three time the average salary in the Philippines (where the great majority of players live). These tokens can be used within the game to acquire a range of items, as well as to facilitate the breeding of the Axies to help them reproduce, thus augmenting the supply chain. Even more interesting, these same tokens can be forwarded out of the game onto a variety of cryptocurrency trading platforms. The play-to-earn economic model has brought about major social transformations in the countries in which the players are based, to the point that, in the summer of 2021, the Philippines (where the Axie game is the most widespread), there are more SLP wallet accounts than bank accounts in the country. 24 Leah Callon-Butler, “Some Filipino Merchants Prefer Payment in Axie’s SLP,” Coindesk, August 2021, https://www.coindesk.com/markets/2021/08/25/some-filipino-merchants-prefer-payment-in-axies-slp Now, one can use SLPs to pay rent, or acquire tangible goods, etc. 25 Tonberry, “BlackPool Academy Community Newsletter #2,” BlackPool, August 2021, https://blog.blackpool.finance/blackpool-academy-community-highlights-2 The play-to-earn paradigm has given rise to “guilds” such as the Yield Guild Games, which play an intermediary role between the “managers” (owners of NFTs), and players: if they cannot purchase Axies as NFTs because they are too expensive, players can “rent” them (referred to as a scholarship) in order to gain revenue. 26 Yield Guild Games, “Yield Guild Games White Paper: Four Big Takeaways,” Medium, June 2021, https://medium.com/yield-guild-games/yield-guild-games-whitepaper-four-big-takeaways-d3e44172609b

DAOs: New Models of Governance?

The governance of the Axie game, which is for the moment hierarchical (like most games where the publisher decides everything), should eventually work as a form of DAO (decentralized autonomous organization): a 4.25% commission on each transaction goes into a treasury, which is currently in escrow, and will eventually be managed by “stakers” (players who set aside a portion of their winnings in the form of tokens that grant them membership shares. 27 Justin Barlow, “Axie Infinity: A Deep Dive,” The Tie, July 2021, https://research.thetie.io/axie-infinity and “Official Axie Infinity White Paper,” December 2020, https://whitepaper.axieinfinity.com/d-a-o Nonetheless, it is important to note that most of the players do not possess their “work tools” and the global economic model remains very unstable.

Other examples linked to NFTs could be precursors of new economic models and modes of organization. CryptoGaming consultants thus offer their services in the form of a fixed-price NFT token that attributes the right to one consulting session per week and, if it is resold, provides a profit of 50% to its issuer. 28 “Whoopdeedoo56’s Breeding Pass: Top Tier,” Rarible.com, https://rarible.com/token/0xd07dc4262bcdbf85190c01c996b4c06a461d2430:644007?tab=owners Another example is the animated series Stoner Cats, which is dubbed by Hollywood stars and Vitalik Buterin (the founder of Ethereum), and was financed in July 2021 with 10,000 NFTs priced at 0.35 ETH ($785) apiece. Each token provides access to episodes of the show and can be resold (with a retrocession of 2.5% to the project team): eventually this will be used to create a dedicated DAO that would be used for the development of new animated series. While there has been increased interest in recent years in cooperative and participatory societies, and, on a more sweeping level, for organizational structures that are less capitalistic and hierarchical, DAOs could usher in more flexibility and be applied to other fields besides companies. Its value system could be open to debate and recoded. It remains to be seen whether “decentralized” capitalism is less rapacious than its current banking equivalent and whether communism can be encoded into liberalism. 29 Mark Alizart, Cryptocommunisme, (Paris: PUF, 2019).

Notes

1 Guillaume Helleu, Anthony Masure, “Total Record: Les protocoles blockchain face au post-capitalisme,” Multitudes, 71, 2018, https://www.anthonymasure.com/articles/2018-05-total-record-blockchain

2 Michael Lewrick, Christian Di Giorgio, Au cœur de la Blockchain. Explorez le nouveau champ des possibles, (Paris: Payot, 2019).

3 Walter Benjamin, “The Work of Art in the Age of Mechanical Reproduction [1939],” Illuminations, Hannah Arendt, ed., Harry Zohn, trans., (New York: Schocken Books, 1969); Pierre-Damien Huyghe, Le Cinéma Avant Après, (Grenoble: De l’Incidence, 2012).

4 Lev Manovich, The Language of New Media, (Cambridge: MIT Press, 2001).

5 Guillaume Champeau, “Bruce Willis n’attaquera pas iTunes, en fait,” Numerama, 2012, https://www.numerama.com/magazine/23584-bruce-willis-n-attaquera-pas-itunes-en-fait-maj.html

6 Jean Aittouares, “Des reproductions très originales,” Gazette Drouot, 2016, https://www.gazette-drouot.com/article/des-reproductions-tres-originales/8982

7 Olivier Ertzscheid, “Le like tuera le lien,” Affordance, 2010, https://affordance.typepad.com/mon*weblog/2010/05/le-like-tuera-le-lien.html

8 Yves Citton, Anne Querrien, “Art et valuation. Fabrication, diffusion et mesure de la valeur,” Multitudes, 57, 2014, 7–19. Quote translated directly from the French but an English version of the article is available: https://www.cairn.info/revue-multitudes-2014-3-page-7.htm

9 Ludovic Lars, “Bitcoin est-il une pyramide de Ponzi?”, Journal du Coin, August 2021, https://journalducoin.com/bitcoin/bitcoin-est-il-une-pyramide-de-ponzi)

10 Alice Robert, “Natively Digital. CryptoPunk 7523,” Sotheby’s, June 2021, https://www.sothebys.com/en/buy/auction/2021/natively-digital-cryptopunk-7523/cryptopunk-7523

11 Andrew R. Chow, “NFTs Are Shaking Up the Art World—but They Could Change So Much More,” Time, March 2021, https://time.com/5947720/nft-art

12 Simon Chandler, “‘CryptoKitties Are Digital Art’: Talking Cats, Crypto with Axiom Zen,” CryptoNews, March 2018, https://cryptonews.com/exclusives/cryptokitties-are-digital-art-talking-cats-crypto-with-axio-1326.htm

13 Kyle Chaika, “Why Bored Ape Avatars Are Taking Over Twitter,” The New Yorker, July 2021, https://www.newyorker.com/culture/infinite-scroll/why-bored-ape-avatars-are-taking-over-twitter

14 For a valuable and detailed chronology of artistic NFTs, please see: Aude Lenay, “Ce que la tokenisation fait à l’art,” in The Great Offshore, RYBN, ed., (Paris: UV, 2021), 319-337.

15 Lev Manovich, “My Notes on the NFT Art Phenomenon,” Facebook, June 2021, https://www.facebook.com/lev.manovich/posts/10160336091277316

16 Baptiste Condominas, “Crypto-Art: pourquoi les NFT divisent la communauté artistique,” RFI, July 2021, https://www.rfi.fr/fr/culture/20210731-crypto-art-pourquoi-les-nft-divisent-la-communaut%C3%A9-artistique

17 Jamie Redman, “NFT Criticism Heightens: Skeptic Calls Tech a ‘House of Cards,’ Claims NFTs Will be ‘Broken in a Decade’,” Bitcoin.com, March 2021, https://news.bitcoin.com/nft-criticism-heightens-skeptic-calls-tech-a-house-of-cards-claims-nfts-will-be-broken-in-a-decade

18 “The Uncanny Valley. Episode V. Toward a New Ecology of Crypto Art: A Hybrid Manifesto,” Flash Art, February 2021, https://flash—-art.com/2021/02/episode-v-towards-a-new-ecology-of-crypto-art

19 Antoine Verdon, “Blockchain et nouvelles espèces numériques,” Le Temps, November 2017, https://www.letemps.ch/economie/blockchain-nouvelles-especes-numeriques

20 Ruth Catlow, Marc Garrett, Nathan Jones, Sam Skinner, Artists Re:Thinking the Blockchain, (Liverpool: Torque / Furtherfield, 2017). Also see the New Kids On The Blockchain encounters organized by Marie Lechner, Anthony Masure and Clémence Seurat at the Gaîté Lyrique (Paris) from November 2018 to June 2019, sponsored by the DICRéAM : http://blockchainkids.xyz

21 See Jesse Damiani, Proof of Art: A Brief History of NFT’s, from the Beginnings of Digital Art to the Metaverse, exhibition (10 June–15 September 2021), Linz, Francisco Carolinum, https://www.cryptovoxels.com/events/345 and Ruth Catlow, Cadence Kinsey, Rob Myers, Studio Hyte, A Blockchain Art History Timeline? A Feasibility Study, (Furtherfield: UCL, 2020). See also Aude Launay, “Another Block in the Chain” in André Hemer, The Imagist & the Materialist, (Vienna: Painting Diary, 2019).

22 “Video Games and their Brave New World,” Three Body Capital, July 2021 https://threebody.capital/blog/2021/7/30/video-games-and-their-brave-new-world

23 Disclaimer: the author of this article, along with three of his associates (Guillaume Helleu, Christophe Branchu, David Bonachera) acquired several NFTs from the game in order to better understand how they work and the economic model overall.

24 Leah Callon-Butler, “Some Filipino Merchants Prefer Payment in Axie’s SLP,” Coindesk, August 2021, https://www.coindesk.com/markets/2021/08/25/some-filipino-merchants-prefer-payment-in-axies-slp

25 Tonberry, “BlackPool Academy Community Newsletter #2,” BlackPool, August 2021, https://blog.blackpool.finance/blackpool-academy-community-highlights-2

26 Yield Guild Games, “Yield Guild Games White Paper: Four Big Takeaways,” Medium, June 2021, https://medium.com/yield-guild-games/yield-guild-games-whitepaper-four-big-takeaways-d3e44172609b

27 Justin Barlow, “Axie Infinity: A Deep Dive,” The Tie, July 2021, https://research.thetie.io/axie-infinity and “Official Axie Infinity White Paper,” December 2020, https://whitepaper.axieinfinity.com/d-a-o

28 “Whoopdeedoo56’s Breeding Pass: Top Tier,” Rarible.com, https://rarible.com/token/0xd07dc4262bcdbf85190c01c996b4c06a461d2430:644007?tab=owners

29 Mark Alizart, Cryptocommunisme, (Paris: PUF, 2019).