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The Louvre Museum had approximately 10 million visitors in 2019 before collapsing under the sledgehammer of the health crisis. A year later, in 2020, attendance plummeted to 3.5 million and only rose to 4.75 million in 2021. An unprecedented collapse in attendance since 1945.
At the same time, digital attendance has exploded for many cultural sites. The Louvre has multiplied by 10, from 40 000 to 400 000, the visits on its site during the first lockdown. If the websites belonging to these monuments have become very popular, some have seen in this phenomenon a real opportunity to attract Internet users in new digital experiences.
Art and blockchain
The culture sector has been trying for years to adapt to the digital age and engage the public while generating increasing revenues. The Holy Grail for institutions and historical monuments is then to transform a passive visitor into an engaged visitor who is willing to host ideas and sometimes even contribute to the development of new content within these infrastructures.
Can the economy that revolves around the sacrosanct blockchain be a breathing valve for certain entities that are sometimes in financial distress? Yes, to a certain extent. But first let's ask ourselves the right questions and not throw ourselves too quickly body and soul into the sprawling network of blockchains.
Cultural institutions must inevitably adapt to remain relevant to their current and future audiences. Integrating blockchain solutions into the arts and culture potentially means offering new interactions between creators, marketplaces and collectors. Ignoring these new technologies would be, in my opinion, shooting ourselves in the foot when they could become a significant business model in the coming years. Let's look at some current examples of organizations that have integrated such solutions.
Do you know the Uffizi Gallery in Florence, which houses Botticelli's famous painting "The Birth of Venus"? During the pandemic, its attendance dropped from 4.5 million to just over one million, causing heavy financial losses. In order to wipe out part of the losses, the museum has embarked on the adventure of NFT (unique digital assets based on a blockchain).
As a reminder, an NFT is literally: a non-fungible token. They are not interchangeable, and like all works of art, they are not equal. Each NFT is different because it is unique.
Only you, the owner, can trade or sell your NFT on the blockchain. Anyone online can share a picture of a famous painting, it doesn't mean they are the owner. The signature shows that you are the sole owner, and again thanks to the blockchain, everyone can see that the NFT belongs to you. For example: a replica of the famous Mona Lisa painting is not worth much. What makes the painting valuable is the consensus around Leonardo Da Vinci's signature. Today it is "easy" to copy the painting itself, but it is impossible to falsify its origin.
Let's go back to our famous Italian museum. It has sold an NFT of Doni Tondo by Michaelangelo, which was reportedly acquired by a collector for the sum of 140,000 euros.
The museum shared the profits with the Italian company Cinello, which digitally patented (NFT) the artwork in question. Each digital work produced comes with a certificate of authenticity created on the Ethereum blockchain.
In the medium term, NFT sales can contribute to the museum's finances. This is not a shift in terms of revenue, rather it is additional income. The museum plans to extend the list of available digital works by digitizing The Birth of Venus, Madonna del Granduca, Bacchus and the Venus of Urbino.
However, there is only one NFT corresponding to each master painting, and we could easily imagine that museums will make several editions in order to generate additional income. For example, we could have The Birth of Venus in a limited edition of five NFTs, against only one today, each representing the same painting in digital format. But on the other hand, this duplication into multiple first editions will automatically decrease its value because the work would become less rare.
For illiquid assets such as exhibited paintings, on which museums' revenues depend, the possibility of being able to market these works differently may be another source of revenue. Clearly, the goal here is financial; we cannot say that simply selling NFTs will increase visitor engagement. In this case, we simply attract collectors whose goal is to resell their digital acquisition at a higher price. Unless the collector now displays his digital masterpiece in a metaverse.
I am a museum
It becomes possible to create replicas of famous works in the form of NFT. Most of them have a special feature that allows to recover a percentage of the sale price each time the NFT is sold and changes hands. This ensures that if the work becomes very popular and increases in value, we receive a fraction (a certain percentage) of the sale with each resale. This traceability is enabled by the transparency features of the blockchain.
I'm a buyer/collector
One of the obvious benefits of buying art is that it allows us to financially support the artists we love, and this is true with NFTs. Buying an NFT also usually gives us basic usage rights, such as the ability to publish the image online or set it as a profile photo on social networks. We can also see the financial aspect of NFTs that can work like any other speculative asset, where we buy it and hope that its value increases one day, so that we can sell it with a profit.
Probably the best use cases of NFTs are not known yet. We could imagine that, beyond the financial aspect, holding an NFT from an artist or a museum could give certain privileges: access to a private group with other NFT holders of a certain collection, private access to certain events, discounts in certain museums... Tracks that could both allow some cultural sites to generate additional revenues, but also to attract and engage visitors with new experiences. If art is what comes directly to mind when we talk about NFTs, they are also used in music, in the metaverse or in video games.
Too early for NFT adoption?
First of all, before a massive adoption happens, it is necessary that a large part of the population experience these technologies. And that is not the case today. It is essential that users experience creating an NFT or purchasing one. But the markets that offer this type of interaction with blockchain are, for the time being, a real Wild West as long as no clear regulations are in place. Without a full understanding of the underlying concepts of NFTs and the markets that offer these types of products, the venture is likely to be financially very dangerous.
We also need more diversity in the way we interact and use these new technologies so that they are not constantly equated with financial speculation, but can start to solve real problems, whether they are systemic or not.
In my opinion, there are several questions that need to be answered in order to provide clear answers to the public so that potential adoption can occur:
What is the value of an NFT? Why would an individual want to own a digital work? Who are the buyers of NFTs? Patrons of the arts or obscure digital asset traders? How do we learn about museum NFT sales and which channels are best suited for the relevant audience? One thing is certain: These innovations open up whole new business models in the way we interact with digital content..
