Established institutes have always been at the forefront of trade and commerce activities all across the world. This well-known and accepted way of conducting business may change drastically as the blockchain revolution gains momentum. Blockchain is a decentralized system, where no single institute or establishment holds absolute power. Essentially, blockchain is a distributed ledger with a growing list of records, called blocks, which are linked using cryptography. This and A.I. are predicted to be the two major revolutions set to occur in the Information Age.
For online utopians, blockchain is a way for the general population to seize power and authority from governments and big business. Skeptics, on the other hand, see it as another fad that will soon be exposed to its flaws and die out as the world moves on to other things.
Bitcoin, a cryptocurrency, is one of the first popularized applications of blockchain that has made use of the peer-to-peer network that does not need the involvement of banks and credit card agencies.
The effect this technology will have in the finance sector is quite clear, it is one of the hottest topics in cryptocurrency news, but how will other industries be disrupted?
The Art Problem
Art is another sector that will see a profound impact, as the need for trusted intermediaries—such as auction houses—will be diminished. Art pieces will be sold, exchanged and auctioned safely, securely and the possibility of theft will be greatly reduced.
From an investor’s point of view, art provenance is of utmost priority. This has been highlighted as an important argument between Alain Dreyfus and Christie’s Auction House. In 2008, Dreyfus purchased an Alfred Sisley painting in 2008. He was later informed by Mondex that Nazis stole the painting in 1940 and it originally belonged to a Jewish family.
Upon finding out this information, Dreyfus willingly gave ownership of the painting to Swiss authorities. He felt let down by Christie’s art provenance and thought that they should have dependable information about the painting’s origins.
It is not confirmed if Dreyfus was reimbursed for the loss he incurred; therefore, exploring the art market, in the current atmosphere, can be considered as a hazardous ordeal.
Issues such as these are a result of the art market remaining relatively unchanged over the centuries. The market has high investment potential, but it remains exclusive to this day and makes it difficult for new entrants. This very quality of exclusivity and privacy gives rise to problems with transparency and shrouds the industry in secrecy.
Blockchain’s Role in Art
Blockchain can help reduce the physical theft of artwork by creating a unique, physical-digital link between the art and its registration on the network. This method may not be able to prevent theft, but it will make it extremely difficult for thieves to resell the piece once the stolen status is recorded in a tamper-proof system.
Additionally, cryptocurrency models may increase the art market’s liquidity and could bring the experience of collecting to the masses, allowing newcomers and small investors to gain a foothold in the industry to establish themselves with minimum risk.
Theft of art is not limited to physical-art pieces that are stolen and sold on the black market, it expands much further into the digital realm where creators are constantly faced with the problem of having their creations and content being stolen, shared without credit, misused etc. The problem of stolen online work is so rampant that you can probably find numerous fake accounts online that share and get away with using other peoples’ content without consequences.
Theft of this kind causes the artist to suffer. It also makes it increasingly difficult for them to establish their name and challenge perpetrators for copyright infringements. Blockchain could provide a solution by acting as the source of the digital art that can verify it too. Using this technology, artists can play an active role in helping to prevent theft by authenticating their work and then sharing the process of authentication with the community.
Once the art community and general public become more aware of authentication, this will automatically make it more difficult for thieves to swipe other people’s artwork and pass it on as their own. Increased awareness will give people a better understanding of how to check whether a particular piece is authentic or not, once verified, they can proceed with buying, liking or even simply supporting the artist.
If art collectors and dealers know how to check for a blockchain-registered CryptoSeal, they can check if it has a unique identity. Once verified, the decision to make a purchase becomes simpler and hassle-free.
As discussed above, we can now distill the key benefits of blockchain for the art world in a few simple points:
- Simplified transactions
- User empowerment
- Greater transparency
- Greater trust
- Indisputable data
- Better security
- Sharing authentication
Realistically, there is a learning curve to overcome. But considering that blockchain technology is considered to be the next big thing, it’s clear that the sooner industries adapt to this inevitable change, the better. It is very likely that the solution isn’t perfect, and people might find loopholes in the system, but in theory and in practice, this is the most fool-proof system coined to date. For this, we have the anonymous person or party Satoshi Nakamoto to thank. More power to the people.