Art auction houses were among the early adopters of NFT. In 2019, two years before the first NFT hype cycle, 4,000 auction houses partnered with Artory, a blockchain-based art registry to record historic artworks and sales.

Serious collectors immediately saw the appeal: for the first time, a secure digital trail of art provenance became publicly available (well, only to vetted “experts” and institutions like Christie’s). This documentation process makes valuation more efficient and adds authenticity to sales. An artwork registered on-chain is provably the original. Any replica created is just a copy.

Of course, this is exactly the selling point of NFTs, except through the frame of a specific use case: uniquely identifying physical artwork. The unique on-chain hash included in an NFT is why they have value in the first place—even if the associated artwork has thousands of copies (digital, or physical).

Clearly Christie’s and Sotheby’s were primed to auction NFTs in 2021. They were already tracking sales using the same technology, even though it wasn’t “decentralized”, or about digital (pixelated) art. In 2021, they were geared to embrace the culture, and art, not just the technology it came with.

Here’s how auction houses are permanently intertwined with NFTs, and why these legacy institutions are still worth watching, when it comes to the future of the space and technology.

Christie’s

2021 NFT Sales

Christie’s Auction House made a stellar entry into NFTs in 2021. The renowned art reseller sold over 100 NFTs, for a combined total nearing 150 million dollars.

This was a statement-making shift by a 255-year-old institution, famous for selling the most important artworks and collectibles in human history, such as Da Vinci’s last drawings.

And once again, their sale spoke to a watershed moment in art history.

Beeple’s Everydays: The First 5000 Days auction got the NFT rush rolling. The super-collage sold for $69 million dollars at Christie’s New York, a record breaking amount for a digital artwork. More importantly, it propelled the digital art veteran into becoming the face of the NFTs.

By September, Christie’s was fully committed to breaking more digital art ground. After the first ever NFT sale by an international auction house in Asia, No Time Like The Present, Christie’s crossed 100 million dollars in NFT sales for the year. This also preceded the Post-War to Present auction, featuring the beloved Gary Vee project, Veefriends. The sale began with another historic event, the auction of Curio Cards, which featured the first-everfirst ever live bidding in Ethereum.

To close out the year, Beeple returned for an emphatic round two. His artwork, Human One sold for 29 million dollars at Christie’s New York, firmly cementing his spot as one of the wealthiest artists alive.

2022: building on NFTs

While 2021 was about hype, 2022 was about building. As the overall digital collectibles market slumped, Christie’s NFT sales fell by 96%. In total, 87 NFTs sold for 5.9 million dollars.

Rather than betting purely on sales, the auction house made another historic, strategic move: in June, 2022, Christie’s established Christie’s Ventures, a venture fund aimed at providing “financial resources and expert support to Emerging Technology and FinTech companies creating solutions with art market relevancy.” Their first investment was in LayerZero, a blockchain interoperability startup, which recently launched LayerZero V2, creating an “omnichain network of blockchains for developers to build universal applications.”

Sotheby’s

Going Natively Digital

Sotheby’s, an auction house which has sold a 710-year-old copy of the Magna Carta, as well as the most expensive watch in history, had an equally impressive dive into the NFT art realm.

Their digital art selling journey began by auctioning what’s considered the “first NFT”, Quantum, by Kevin McCoy, and his wife. Quantum attracted criticism, to the point of a legal dispute, because McCoy did not renew ownership of the Namecoin asset in 2014, and instead “re-minted” the artwork on Ethereum in 2021, thus making it a replica. Namecoin requires owners to periodically renew the asset, much like domain hosts for websites. However, the case was dismissed in March 2023, as the judge sided with the creators, instead of the current owner of the renewed asset, who had quickly renewed the original NFT after news broke about the auction.

Despite the controversy, the sale closed at 1.4 million dollars and signalled Sotheby’s entry into the NFT space.

Another major leap for Sotheby’s came in the shape of Sotheby’s Metaverse, a digital platform solely for NFT art sales. Sotheby’s Metaverse opened with their Natively DIgital auction in June, and included the sale of various Cryptopunks. Natively Digital 1.2 followed at the end of October; the weeklong show featured 53 works from the collections of significant NFT collectors, such as RarePepes, Mooncats and CryptoPunks. Curio Cards went on auction a second time, granting them the unique distinction of being sold at both of the largest auction houses within the same month.

All told, Sotheby’s amassed over 100 million dollars in NFT sales during its first year—but also incorporated VR technology as a way to experience the new art wave.

2022–now

In March 2022, Sotheby’s was meant to sell 104 Cryptopunks during a live auction, with an expected total of at least 30 million dollars. However, minutes before the auction commenced, it was announced the consignor had withdrawn. Later, the anonymous collector presumed to own the Punks tweeted, “nvm, decided to hodl,” which quickly became a meme.

In another pioneering move, though, Sotheby’s conducted the first “single-owner NFT sale” of 26 famous works collected by an anonymous collector, MaxStealth. Lots sold included works by Beeple, XCOPY, Pak and Hackatao, among others.

Tracking the traditional art world’s new moves

Despite 2022’s setbacks, overall NFT trading volume soared to a record high (1.2 billion dollars) in the week of May 1 that year.

This shows how healthy the digital art trading market continues to be, even during “bear markets” as buyers and sellers use OpenSea and Blur — a zero-fee marketplace aimed at NFT traders which launched in October, 2022

Recently, NFT sales have continued to hit mainstream auction highs. A Bitcoin Ordinals project called BitcoinShrooms recently sold at Sotheby’s for nearly 450,000 dollars. This was the first time works from the collection became available to the public for purchase, effectively like an NFT drop on OpenSea.

Even though sales aren’t always consistent, adoption of the technology continues to increase, meaning those who are still around during spikes in voluhme can benefit more significantly.

While selling at a prestigious auction house remains a dream for many artists, NFT platforms allow digital artists to become millionaires by dealing with “degens” directly. Part of that stems from the hype and financial speculation around a new culture, but also, because of the promise of the technology.

Arguably, new upcoming artists would rather “mint out” on OpenSea, because there’s no auction house fee to pay, and they’ll likely to develop a loyal following via platforms like X, if they’re active.

Even so, as the market and technology continue to evolve, auction houses will continue to spearhead change and attention, as they’ve done since before the hype cycle started. It might therefore be useful to track Christie’s and Sotheby’s’ moves for a perspective on the next waves, both in art, and Web3.