Originally published on Substack on July 10th, 2021.

I’ve been hearing about NFTs for about half a year now, and never really took an interest in them. I’d occasionally see some abstract pixel art or kitten cartoon on my Twitter feed, and to be honest, I thought it was almost pointless that people seemed to be spending money on them. I didn’t really understand what they were or why they mattered. That was also around the time when I started to learn how to create digital art, and most of the artists I was interacting with online were people my age who eschewed NFTs due to misconceptions about them. 

Over the last couple of months, I’ve been talking to more and more people in the crypto world (in large part thanks to On Deck Catalyst) and became much more interested in NFTs...especially how they are changing the game for artists.

What even are NFTs?

Basically, NFTs are digitally unique tokens that exist on the blockchain (most commonly Ethereum). I’ll leave the details to them.

How do artists benefit from them?

In my view, there are three major ways:

1. Ownership and monetization
2. Artist to fan relationships
3. A (more) level playing field

Ownership and monetization

Because NFTs are stored on the blockchain, anyone at anytime can check who created it, who used to own it, and who owns it now. This “digital paper trail” allows the original creator of the NFT to take a portion of the sale each time the NFT is sold. Thus, no matter how many times an NFT exchanges hands, the original creator is paid in cryptocurrency.

This is especially game-changing for artists, because in addition to (or perhaps, as a symptom of) art being traditionally undervalued, art is often stolen, re-sold without the artist’s permission, and/or used in a variety of physical and digital products that are sold without licensing agreements.

Wait...but can’t someone still do that even if the art is created as an NFT? They could just download the image, make prints of it, and sell them online without telling the artist.

That is technically true, but the status quo is already as bad as it gets for artists. They make nothing off of stolen/re-sold art. At least with NFTs, when the “original” is sold and re-sold, the artist is rewarded for the value that each buyer sees in it, and additionally, they have knowledge of who the buyers and resellers are. The mode through which creations are shared is inherently more transparent. 

The one caveat here is that if someone turns your art into their NFT, they could potentially make millions off of your work...repeatedly. Artists’ creations are technically protected under copyright law, but for now, it’s mostly up to the platforms to verify that the creator is minting an NFT of their own work. More on that here.

Artist to fan relationships

NFTs open up a huge opportunity for artists to identify their most passionate fans, build community, and make more revenue as a second-order effect.

When I think about fans spending on purely digital things to support their favorite creators, the first thing that comes to mind is Twitch livestreams. On Twitch, fans purchase subscriptions to unlock special emotes to use in chat, show animations on screen to capture the streamer’s attention, and much more.

Buying an NFT, especially one of high price and/or high scarcity, is a way for a superfan to 1) capture the artist’s attention and 2) express their appreciation for their work. 

For the artist, this helps them identify their strongest fans - people who will pay the most for their art and share their art with others. Smaller artists who may not have a large following can now hone in on their “1,000 true fans,” and larger artists can find not only the fans who will pay the highest price, but the fans who could be the ones who lead and moderate their online community, drive marketing, and more.

Outside of identifying superfans, NFTs also open up another avenue for artists to engage with their followers - they can organize NFTs as giveaways, use rare NFTs as art contest prizes, and create limited NFT collections. Stronger artist-fan relationships → higher likelihood of monetization → growth in community → more strong relationships.

A (more) level playing field

Because NFT art is sold, bought, and owned digitally, artists who utilize more nascent technologies and/or mixed media formats can now more fully participate in the “traditional artist’s experience” that includes art auctions, being displayed in an art gallery, and more when they were previously unable to do so.

Lesser known artists can have another avenue for gaining an online following via NFT marketplaces such as OpenSea, Nifty Gateway, and many more. Nowadays, pretty much anyone can mint an NFT, with different platforms having different processes for getting your art onto them.

This is just the beginning

I’m personally very excited to see where NFTs take us -- as our digital life becomes an increasingly important part of our identity, NFTs will play a larger role in not only how we express ourselves creatively but how we live our lives. We’ll use NFTs as receipts for transactions, rewards in video games, and much more...but for now, it’s pretty damn cool to see artists thriving. 

Special shoutout to ODC friends who encouraged me to start writing publicly, and Rafi and Adithya for reviewing :)