A R T C E L S launch first tokenised asset-based contemporary art exhibition XXI
A R T C E L S has launched the first asset-based contemporary art exhibition, titled ‘XXI.’ The digital platform for blue chip art investments will offer investors equity in the form of digital tokens backed by shares in the artworks, reports Asena Degirmenci.
Founded by commodities trader Gijs de Viet and London-based contemporary art gallerist Elio D’Anna of the House of Fine Art (HOFA), these blue chip art investments will be available to a wider and younger international market.
The mission of A R T C E L S is to provide an alternative approach to the traditional ways of investing art, as well as building a portfolio of art that houses rare editions.
Artworks on display will include Banksy, KAWS, Damien Hirst, George Condo and Jeff Koons.
Speaking on the idea behind the launch, D’Anna stated: “Nobody's ever done tokenisation of a full exhibition and our use of blockchain technology also gives it a new layer. We have a very unique condition report and authentication process, using Swiss technology that scans the works at a molecular level.
“This information is combined with a certificate of authenticity and all the information that the subscriber gets, and that's what generates the token. It is a combination of information, the share certificate in ownership, the condition record and the subscriber agreement. Everything is combined and then placed on the blockchain.”
Combining art with blockchain tokenisation
Shares of the blue-chip contemporary art will be worth a minimum of £390 ($500), which will be determined through quantitative strategies for art asset acquisitions. This will be made available exclusively to subscribers.
D’Anna said: “I've been following technology for a while and we are also one of the first galleries to work with technology. Cryptocurrency is not perhaps very well seen, which is something I think everyone understands. But I think it is also recognised that blockchain is a technology that is undoubtedly efficient and secure. It has been now implemented by financial institutions and governments.
“It is interesting to be able to play something in a very transparent way, in a way that everyone is able to see where it comes from. In the art business, it is called provenance. Provenance is the most important thing in the art business. That is why I think provenance in a financial matter is what banks have been fighting for so long with anti-laundering regulations, because they effectively want to know where the funding comes from. The fact of being able to have full transparency is something that is going to drive both the financial world and the art world up.”
How do the digitised tokens work?
In order to reduce the risk associated with investing in art, A R T C E L S has partnered with a number of companies including 4Art-Technologies AG and Assetyze AG.
4Art-Technologies AG provides authentication for its art assets, while Assetyze AG provides blockchain-based solutions to create a secure digital token that can reliably proof the existence of the tokens that have been digitally issued.
D’Anna said: “We scan all of our works with state of the art technology and we have all the information with insurance, certificates and documents all combined.
The subscriber creates an account and has access to all those documents and is able to see them at any point. This is what we call a digital fingerprint. In order to achieve that there is obviously the use of blockchain, but later on you will be able to trade these in the open market.”
The target audience for XXI is younger, web-savvy investors with an offer on high-end assets and high value shares.
“The exhibition work has already in a way achieved what we wanted to do, which is to put together some one of the most amazing art portfolios that we could get our hands on and present it to the world. The media response has been amazing, we have been live on Sky News, the Telegraph and the Wall Street Journal,” said D’Anna.
“It's amazing to give this opportunity to the everyday person to be able to buy into something really valuable and appreciative, which is something that is more of an elite concept in art for the very few. Especially some of the pieces that we have, it has been impossible for anyone to buy and some of them have escalated in crazy prices. The opportunity to give everyone access to such valuable work has been both an inspiration and also the goal.”
Subscribers will be available to access their investments at exclusive art events that will take place multiple times a year in various locations around the world.
D’Anna concluded: “Our business model is that we do yearly releases. Five exhibitions in year two and 10 exhibitions in year three. Each release is under a different vehicle, meaning a different company. We are very strict with the number of shares and tokens that are issued in each company – we don't issue more. We don't dilute the positions of anything that is within our contracts with our subscribers. That way we retain value.”
London, Los Angeles and Shanghai are already planned for 2020.