Scams, impostures… The dark side of NFTs agitates the art world

Do you know Pac? Fewocious? XCopy, Hackatao or Beeple? If these names mean nothing to you, you have missed out on the phenomenon of 2021: the great explosion of crypto-art. This surge has made these prodigies of digital art, hitherto unknown to laymen, pixel moguls. These multimillionaires (in cryptocurrencies) do not only owe their fortune to their creativity or their virtuosity in the handling of the graphic palette. Their success would not be what it is without the NFT, non-fungible token, a non-fungible token for insiders. Do not be fooled by its barbaric surroundings. The term is so popular that it was voted word of the year by Collins, the English dictionary! In short, this technology means a digital property certificate, which links a work and its creator to the collector or art lover who acquires it. The goal is to ensure that the canvas or sculpture is the original, and not a vile copy. An NFT is bought with a cryptocurrency, mainly ethereum, and remains stored in the blockchain, an unfalsifiable cyber-register.

“The idea of ​​being able to claim possession of a digital object is unprecedented, explains John Karp, art lover and co-author of the essay. NFT Revolution. Birth of the crypto-art movement. By distinguishing the original work from its copies, the NFT creates rarity and therefore value.”

However, this distinction remains artificial, because technology cannot prevent a digital work from being duplicated. “So what’s the point of paying small fortunes for a pixel canvas, when a right click is enough to store it on my smartphone screen?” ask many detractors. “It’s like buying an authentic masterpiece knowing full well that copies of counterfeiters are circulating,” retorts Jean-Michel Pailhon. This lover of street art and digital art, a senior executive in a security company linked to cryptocurrencies, has already acquired several NFTs, such as this portrait produced by an artificial intelligence, inspired by the thousands of paintings from the 16th and 17th centuries. “I would be delighted if this work were copied and pasted everywhere, because this sharing contributes to the notoriety of the artist and to the value of the canvas of which I remain the sole owner, he confides. In my eyes, the material possession matter less than intellectual property.”

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Questioning the role of merchants

NFTs promise to change the lives of artists. Programmed in the blockchain, the smart contract (intelligent contract) guarantees, for example, the author to automatically receive royalties during successive resales. If this principle of a “resale right” is not new, in practice it was rarely respected when the work changed hands.

Technology also calls into question the role of traditional merchants, curators or gallery owners. Most of the time, NFT purchases take place via electronic marketplaces, which ignore these intermediaries. OpenSea, the most popular, is valued at more than $13 billion since its last fundraising in early January. It claims more than a million users, who exchange virtual works via its platform. In a few clicks, thanks to her, an obscure field mouse worker can turn into an icon of crypto-art. “Artists without the slightest rating, but who have a strong community on social networks, can achieve record sales which propel them in a few hours among the greatest”, summarizes Thierry Ehrmann, the founding CEO of Artmarket, a specialist in the quotation and sale of works of art online. Last year, the American Mike Winkelmann, alias Beeple, a 40-year-old digital artist who had escaped all radar until then – he had never exhibited or participated in auctions – thus climbed onto the podium of the most living artists bankables, behind David Hockney and Jeff Koons. His work Everydays: The first 5,000 days which compiled 5,000 of his creations into a single JPEG file, was sold for more than 69 million dollars, a record.

The success of NFTs is certainly not limited to these astronomical prices. “9 out of 10 sales do not exceed 20,000 dollars, and almost half are concluded below 1,000”, assures Thierry Ehrmann. The expert therefore sees in this an unexpected opportunity to open up art to a younger and less affluent public than the population accustomed to frequenting traditional auction rooms. But given the excesses that accompany the explosion of the market, he is likely to be disappointed.

Far from democratizing digital art, certain categories of NFT are increasingly seen as outward signs of wealth. This is particularly the case for the avatars of monkeys in the series Bored Ape Yacht Club or even these ultra-pixelated portraits of the family CryptoPunks, characters automatically generated by an algorithm. Sports and showbiz stars are snatching up these new virtual icons with hundreds of thousands of dollars, to show them off on social networks, instead of their usual profile picture. In this race for the most bling-bling people, Eminem holds the rope more than ever. The monkey portrait he gave himself in January, for 123.45 ethereum ($450,000), is more than twice as expensive as the CryptoPunk acquired last summer by another famous rapper, Jay-Z.

“Violent beating”

Should we be surprised that this rush for art does not only attract purists? “NFTs were pushed from 2017 by cryptocurrency market players, with the aim of promoting the circulation of virtual money through new transactions. Fictional artists were sometimes even launched and staged to sell works at completely crazy prices, which do not reflect the reality of the market at all”, confides a specialist. He predicts a “violent correction”.

Novices abstain. While they are often presented as models of transparency and authenticity, NFT transactions are the pretext for scams of all kinds, making this supposed Eldorado a Wild West infested with crooks, imposters and cyber-manipulators. .

Researchers point to the wash tradinga technique that consists of buying yourself a work that you already own, pretending to be an enlightened collector, to increase the value of the property… Or launder money.

Even more annoying for a technology presented as a guarantee of authenticity, the impostures are multiplying. On TikTok, a tutorial explains how to create and then sell an NFT from an image stolen from the Net. Impersonating its original creator is child’s play: OpenSea, for example, requires nothing more from the vendor than a sworn statement. Last year, smart guys did not hesitate to pretend to be Banksy, the British icon of the street artto put up for sale several hundred thousand dollars worth of NFTs.

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But much less popular artists are not spared from this fraud. This is particularly the case for those who openly exhibit their work on the DeviantArt online gallery, in order to make themselves known. Since last year, their cyber-showcase has been the subject of a looting in order. Witness, for example, the Twitter thread @NFTtheft, launched in September to document these deceptions. The works are copied, with a simple right click, then put up for sale in the form of NFT without the knowledge of the real authors, on Opensea or one of its competitors, Rarible, Decentraland, SuperRare, Mintable… “That don’t stop, tweets a victim. Creators are having their works stolen by unscrupulous people, who make money from them with NFTs, without the real authors receiving anything … And during this time, we are told that NFTs are the solution to remunerate artists? Cheating is so widespread that DeviantArt has developed an artificial intelligence to identify usurped works. But it is limited to sending a warning message to the victims. It is up to them to turn to the responsible platform. Without much hope of repairing the deception, alas. Because the all-powerful blockchain was designed to be inviolable: once an NFT has been recorded, it is impossible to delete it…



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Scams, impostures… The dark side of NFTs agitates the art world

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