The Indicator from Planet Money - Market Power To The Beeple

Digital art has been largely neglected by the traditional art market, but one artist has made millions selling his work as non-fungible tokens (NFTs). And his work is now being auctioned at Christie's.

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Content Keywords: Mike winkelmann

the indicator from Planet Money. I'm Alexi Horowitz Ghazi like dorky looking at a lot of people compare me to Bill gave people are surprised because Mike winkelmann is not just any sweater vest in Suburban dad in his late 30s who works from home like is actually an extremely popular digital artist known to his 1.9 million Instagram followers and many others as people maybe both has become a pretty internet famous for what he calls his Every Day's project where you create sand post an original piece of computer rendered art digital art, every single day is every day's have taken the form of these disturbingly realistic often protest sci-fi science inspired by things in the news.

Announce TV stepping down as Amazon CEO last month my posted a picture on Instagram captioned released the Bezos, you know giant squid thing. And so it's a giant Jeff Bezos had sort of in the ocean with tentacles sort of wreaking havoc and he's holding up like shipping containers and stuff and there's helicopters flying around him. Mike has now been baking and posting one image a day like this for over thirteen years totaling over 5000 images, but for most of that time Mike is actually made his money elsewhere for a few years as a web designer and more recently as a freelance digital artist for performers like Lady Gaga and Justin Bieber which is to say Mike has been doing just fine financially but his own personal art copied and pasted and shared across the internet though it is.

Directly me too much money and the whole category of digital art, which is basically infinitely reproducible by definition hasn't really been able to find purchase in broader Art Market my says it's basically been ignored by fancy art galleries and auction houses and they have quite a good reason. Actually there was no way to collect it. Like there was truly no technology available to collect my art and sort of a natively digital for at least that's what he thought until about four months ago. That's when Mike found out about a new kind of blockchain technology that has been Rippling through the digital economy. The technology called nft or non fungible tokens are basically certificates of ownership like unique bar codes that can't be duplicated and you can attach them to all sorts of digital files from pictures to videos to tweets. It's a way to own something you just couldn't really owned in the past and Mike story offers a window into how entities are already dramatically reshaping the Art Market and kind of the whole idea.

A property in the digital age being sold on online platform. He realized they might offer a technological solution to that collectability problem. They had left a lot of digital artist like him on the margins of the art establishment. Mike winkelmann dips his toes into the NFD Art Market and pretty quickly gets totally soaked in money. This message comes from NPR sponsor Microsoft teams, helping priority bicycles transform the way they work when the panda make it they started doing virtual visits on teams. Now people worldwide can come into their showroom Morad teams. This message comes from NPR sponsor the Capital One Quicksilver card with Quicksilver. You are an unlimited 1.5% cash back on every purchase everywhere. That's all there is to it just unlimited 1.5% cash back on everything you buy what's in your wallet.

So after digital artist Mike Bebo Winkleman decided to get into the marketplace for entities, you set up an initial auction on an mft platform called Nifty Gateway last October are sites that basically administer the supply of new entities and oversee their exchange fans a cheap way into NFC ownership. Well also testing out the market he decided to create a limited set of 100 identical nfts and sell them for a dollar apiece. I know they were worth more than a dollar but I thought they were maybe worse like maybe fifty or a hundred dollars. And so these instantly sold out obviously and pretty immediately people started trading them because the thing with entities as you can immediately sort of resell them through the different platforms and because and a few transactions are conducted in the blockchain, they're all in public view blockchain is basic

Like an open letter system where everyone can see every time one of these unique ownership tokens changes hands than for how much every time in nft is sold these platforms are able to offer a 10% cut to people like people as a condition of selling their work in the first place and makes us within hours people were flipping those $1 tokens for thousands of dollars so fast forward to today those $1 editions recently this week sold for $300,000, you know, when a tree sells 10% is automatically goes into my wallet just to reiterate every time somebody resells one of Mike's mfts. I'm one of these platforms. He's automatically cut into the deal for 10% which is a pretty Mark improvement from hardest get paid in the normal heart market and ft drop as they're called series.

20 separate nft auctions that he's scheduled to play out over the course of a weekend he and his family went over to his brother's house for a kind of weekend watch party in the backyard. How much does a you made by the end of that weekend in December gross 3.5 million and then after fees and everything a kind of ended up to be about 3.3 million that I kind of like take-home not a bad weekend in the backyard. That was a pretty good weekend. It wasn't too long after the success of his auctions before Mike got word that a prominent member of that highfalutin art establishment that has long ignored his kind of wanted to get in on the action Christie's the esteemed British Auction House founded in 1766 was interested in selling one of his pieces for their first-ever auction of a purely digital nft. Noah Davis specializes in post-war and contemporary art at Christie's and he was one of the folks tasked with bringing people to the fancy our people and don't know Ascent Mike into his

And ask him to choose what he might sell to the Christie's crowd. He came back to us with this Mosaic collage of all 5000 images in his Every Day's project and that kind of punched me in the gut really because Noah says Not only was the composite image aesthetically beautiful, but it also allowed viewers to zoom in and engage with anyone of the 5000 individual images that made up the Every Day's project Illustrated. The capability of nfts to do something that traditional art can't people auction which opened a couple weeks ago with a starting bid of $100 is a kind of test case for how nfts and digital art could do in the High Roller in world of the international Art Market. I could have never told you that in the first 10 minutes of bidding we would get from $100 for a starting bid to more than a million dollars is still going on but no it says that with the current

It over 13 million dollars, the people auction has proved the market demand for digital art nfts. Beyond a doubt that things are moving so quickly. There is a risk for speculation and wild variations in price, but he says that Christie's will be extremely purposeful about how they go about choosing which entities to back.

Recipes work on the traditional Art Market has really exciting implications for tens of thousands of digital artist like him you worried that this is a bubble or a flash in the pan of some sort. I actually believe it is a bubble to be quite honest. I think you're going to see a mad rush of people come to this phase and a lot of the stuff that people are making an entities is junk and that's will not hold its value. And so it is quite speculative at this point and you need to be sort of thinking about these things is what I'm investing in here something that is going to hold value over a long. Of time. And how many pieces do you?

Available in your your catalog just in case you wanted to sell them so quiet if you so out of the 5000 I've sold 23, but Mike says he doesn't plan to release much more that catalog anytime soon of people every day's may just be the key to keeping them in astronomical demand.

this episode of the indicator

by Darian woods with help from Gilly Moon. It was fact-checked by Sam thigh and edited by Julie Myers. The indicator is a production of NPR.

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