How does NFT Become a Value Carrier for Digital Culture and Art in the Metaverse? with Jianing Yu and Ciara Sun

By Guest Contributors Jianing Yu and Ciara Sun
Authors of The Rise of the Metaverse, Jianing Yu and Ciara Sun, tell why NFT is the best carrier of digital art in the metaverse era and what the future of digital art is.

“Digital” represents rationality and precision, while “art” represents sensibility and creativity. These two elements combined together to form “digital art” have become the epitome of digital cultural prosperity in the metaverse, exploding a different kind of power.

In March 2021, renowned artist Beeple’s NFT work Everydays: The First 5000 Days sold for $69,346,000 at CHRISTIE’S, making it the third highest price for a work by a living artist sold at the time.

Soon after, at the opening of the “DoubleFat” encrypted art exhibition in Beijing’s 798 ArtDist, the curator Wen Ze and I burned Leng Jun’s painting “New Bamboo” and then created a digital artwork in the form of NFT, which was successfully auctioned off at the exhibition. Destroying physical artworks to create digital artworks is a controversial attempt. But in fact, the process to burn the original painting first and then carry the value of the work electronically by means of NFT is not destruction, but a new birth, a process that allows the form and value of art to achieve a further upgrade.

As we see, the development of art based on the digital form of NFT breaks the original cultural and artistic forms and becomes a brand new creative field combining technology and creativity in the metaverse. This new way of art carrying can promote the great prosperity of digital culture in the metaverse and allow culture to be continued in the world of the metaverse. With the development of technology, artworks in the metaverse are no longer limited to the digitization of physical artworks or the creation of digital artworks in traditional forms, instead, technology allows creation to be free from the confines of the two-dimensional plane, free from the time dimension and liberate creativity, allowing everyone to become an artist in the metaverse.

NFT is a digital asset issued based on blockchain, its ownership and transaction flow are recorded on a tamper-evident distributed ledger. In the metaverse, no matter artwork, collectibles, game props, domain names, tickets, or any unique property can carry value by means of NFT. NFT will become a “value machine” that empowers everything and becomes a bridge between assets in the physical world and assets in the digital world.

Why is NFT the best way to present digital culture and art in the metaverse? Before the emergence of NFT, digital art creations could be copied and used freely, making it difficult for creators to confirm copyright ownership and gain revenue. The artwork in the form of NFT allows everyone in the metaverse to easily own digital objects. NFT not only has the characteristics of uniqueness, immutability and permanent preservation, but also solves the problems of property rights and transaction flow of digital objects, thus expanding the circulation range and greatly enhancing liquidity. At the same time, NFT creators can write royalties into smart contracts and can continue to receive royalty revenue from subsequent transactions of their works.

In summary, the 5 main features of NFT make it the best carrier of digital art in the metaverse era:

1. NFT is the proof of circulating value, which allows cultural and creative products to enhance their liquidity and connect to the global market.Meanwhile, NFT can be traded on the blockchain through smart contracts, and can be publicly displayed in the global marketplace for sale to collectors worldwide in a highly transparent and trustworthy manner, effectively enhancing the liquidity of artworks.
2. The NFT is the proof of authenticity, it can’t be faked and have no forgeries. Each digitized NFT contains the digital signature of the maker, which is guaranteed by asymmetric encryption technology and can be easily verified as genuine, so there are no “forgeries”.
3. NFT is the proof of scarcity, which makes the flow of cultural and creative products orderly, the history of transactions highly transparent and traceable, and the scarcity real and credible. Digital collectibles in the form of NFT will be issued and each flow of transactions will be recorded on the blockchain, and the records cannot be tampered with. The total number of issues, transaction history and other fundamental information are clear and transparent, so buyers can easily make analytical judgments based on this information.
4. NFT is the proof of ownership and avoids disputes over property rights. Besides the low cost and high efficiency of NFT for ownership determination, it is also easier to demonstrate other property rights. For example, whether this NFT artwork is being mortgaged, or whether it is insured. All these operations can be queried through the blockchain browser, and the relevant situation can be seen at a glance.
5. Through ‘proof-of-income’ rules, NFT creators can rep ongoing rewards from collectors’ appreciation of their work. NFT creators can set up to charge royalties and use smart contracts to ensure a draw from each subsequent transaction to share the long-term value of their work.

In the metaverse, the combination of digital technology and cultural creativity will realize the great development and prosperity of digital culture, and NFT will realize the assets and economic security for these digital cultures. The integration of “digital” and “culture” will continue to bring us surprises, and digital culture will gradually develop into the mainstream culture in the metaverse.

 ABOUT THE AUTHORS

Dr Jianing Yu is Executive Director of the Metaverse Industry Committee of the China Mobile Communications Federation and a university educator of blockchain courses.

Ciara Sun is the founding partner of C² Ventures and previously worked at Boston Consulting Group, Deloitte Consulting and Ernst& Young.

Suggested Reading

This book outlines six important trends in the era of the metaverse, that will see dramatic changes in technology and the bringing together of digital and physical worlds. People will experience a great migration of their social life and economic activities into the metaverse. Furthermore, the authors argue that, in the metaverse, we can get rid of many of the constraints of the physical world, achieve a better self in the new digital space, and truly maximize our own value as human beings. This book sets out how you can seize the opportunity of the metaverse era.

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