Interview: Zack Yanger

I’m Zack Yanger. I’m the senior vice president of the art advisory and business development at SuperRare.

What are the basics of NFT?

Yeah. So NFT stands for non-fungible token. And what that really means is it’s a crypto token that represents ownership of a unique asset. So if you think about like bitcoin, for instance, that’s a fungible asset. If you have one bitcoin, I have one bitcoin, we can trade them, doesn’t matter which bitcoin is which, because they’re always going to be the same. But a non-fungible token represents ownership of a single asset that is unique, so an artwork or a piece of virtual land or a collectible or a music audio track. No two audio tracks are going to be the same and so each one will have a different value that underlies it. And so essentially, Ethereum is the blockchain that really has spearheaded this NFT movement back in 2017, 2018, is when it really started to grow the space and SuperRare was the first platform that essentially allows artists to mint their own tokens as NFTs.
Interview: Zack Yanger, Dot Red

Can you talk about how an artist sells a token through your platform?

Yeah, for sure. So what’s great about SuperRare and NFT platforms is that artists have the ability to have complete control over their artistic process and business. And so essentially, it’s completely peer to peer, which means that any transactions that are happening happen directly from a collector directly to the artist. On our platform, we don’t custody people’s money or people’s art. 

And so if you’re an artist, it’s very simple and you basically just log onto SuperRare and you are essentially presenting your artwork file. So if the artwork file is animations or videos, each of these video files is essentially certified on the blockchain and the token represents your ownership of that file.

A lot of people will ask if anybody can see it on the internet—why would I buy the token if you can already see it? Really, that, in a way, is the biggest difference between the traditional art world and the emerging digital NFTC space. For physical art the value is really driven by the ability to control who else sees that art. And really, most of the best art in the world is owned by a small select lucky few. But with art that’s natively on the internet, it’s really impossible to prevent people from screenshotting or accessing that file. But at the end of the day, with internet content, the number of views, the number of downloads, the number of shares, the number of people sharing it on their social media—that is just growing more and more interest and knowledge about that image. And so that actually helps to grow the value of the NFT because anyone can see it, anyone can enjoy it, but only one person in the world can prove they own it. And so if you own an NF T representing an artwork that millions of people around the world are featuring on digital displays in their household, that to me is an artwork that has true value in it. So the concept of anyone being able to enjoy and view the art, I don’t think that that should affect its value. And that’s really a big kind of underlying aspect of the space.

With the platforms, how can an artist tell what is the best platform for them?

There’s many different types of artists approaching the space and they have different practices, whether it’s painters that are animating or digitizing their paintings in some way, or whether it’s animators, depending on how these artists have always done business. Many artists will sell prints, for instance, of their works. And so for those artists doing things like multi editions. Each of these artworks (behind me) is a single edition NFT. And so what that means is that only one person in the world at any given time can own each of these artworks and the token representing it. But you could also have multi editions, so this artwork right here could have 100 different editions of it, same as a painting could have 100 prints and so 100 different people can own it. It basically allows a little bit of a lower price point entry. It’s really up to the artists on how they want to approach the market. 

I personally am a big fan of single addition artworks and think that that’s really where a lot of the future value is going to be. But it’s a new space and it’s ripe for artists to experiment and I think that the most important part is the artists just kind of start to understand how it all works. Because at the end of the day, it’s changing lives. I mean, digital creators for decades now have made no money off of their creative abilities beyond getting commission work and working for ad agencies. But now digital creators actually have the ability to do what they love full time, they’re getting respect. The biggest auction houses in the world are now doing more NFT sales than they’re selling anything else. And so it really is an entire new movement that artists should just take the time to research. Don’t dive in. Don’t just go release everything you can, wherever you can. I think it’s important to look into the tech and really understand how each of the platforms work and how the process works overall, what the collectors are like on those platforms, and then make the decision based on what you’re comfortable with.

Let's talk about the current environment that we're in right now. You have a lot of traditional art and you have the NFTs. Are the traditional artists are going to be able to transition into digital art if they still enjoy the physical elements of their creatives?

Definitely. We’re here at the LA Art Show. SuperRare is the official NFT marketplace of the show and it’s important because this is the first time that NFTs have really been at one of the big art shows around the country and the world. We’re just now starting to see this change this year, and I think that there’s already many traditional artists that are entering the space. I mean, Damien Hirst, last week, one of the highest selling living artists just sold a piece, and it had 10,000 editions and sold out very quickly. But some of the biggest artists in the world are now in the traditional space and are already entering the NFT space. We’re here with Vellum LA, who has these incredible works—these are the first museum grade digital displays. 

It’s really exciting for us because it’s one thing to see NFTs on your computer, on your phone, but up until now, the best display options, you can put them on nice TVs. There’s some other great options like a mural, which are a little bit of a smaller option. But as museums now are really starting to take interest in this and many of the biggest museums in the world are starting to have NFT collections, they’re going to need actual display technology. Standard vision does a lot of the outdoor digital display all around LA and many other cities around the world. We’re extremely excited to work with them on this. I mean, it’s the best I’ve ever seen NFTs displayed in the real world, and we’re right here at the front, all of these people are coming here to see art. I think that for us it’s mostly about being here to educate and answer questions and help people understand that there’s this new revolution forming and it’s going to be a matter of time before most companies and most artists have some sort of NFT strategy. So I think that more than anything, it’s an experience.

Interview: Zack Yanger, Dot Red

What is the future of digital art? What is the future of art?

Well, I think that we’re seeing NFTs completely revolutionized the art world. I mean, on one hand there’s the concept of royalties. So I mean, if you’re a painter and you sell your first painting for $1,000, and the collector turns around the next week and sells it for a billion dollars, you get none of that. But with NFTs, it’s built into the smart contracts underlying the technology behind each one that every time it resells in the future, the artist instantly gets 10%.

We have artists we’ve been for three years now, and in the beginning, NFTs were selling for $50 to $100, and many amazing artists who were selling these were all really excited. People are buying them, period. But now those same works are reselling for $500,000 or million dollars more, and those artists are getting 10% of that after selling it for $100 three years ago.

And so the concept of royalties is massive. We just also launched the concept of collector royalties. So essentially, what’s also pretty groundbreaking is that if you collect one of these artworks, you are locked in for a 1% royalty on the future resale of it. It really adds a whole new kind of level to collecting that you’re able to—I mean, that’s really the most groundbreaking part in my mind of the NFT revolution is the whole concept of royalties. For the first time in history now, artists are able to actually make an ongoing income off of the secondary sales of their work because it’s built into the underlying technology behind each NFT and the smart contract underlying it—a royalty system where every time it resells to a new person, that artist gets 10%. It happens instantly on Ethereum, go straight into their wallet. It could happen at any time and it’s all completely instant. And why that’s really important is that if you’re a painter, for instance, if you sell your painting for $100. If that collector turns around in a few years and sells it for life changing money, you get none of that. I think that artists having that ability to get a reoccurring revenue stream is a big game changer and part of why many artists are now able to do what they love.

The other big aspect that we just introduced is collector royalty. Essentially it’s the first time there’s ever been a royalty for the collector of an artwork. Any artwork that’s collected on SuperRare, they’re all single edition artworks, one person can own it at a given time. But by being that collector, you’re locked in for a royalty of 1% on the future every time it resells. And so you’re really in a way betting on the artist and it makes it to where even if you end up selling it in the future, you still maintain part of that artwork’s story forever, and you’re still built into that provenance forever. What’s really the third and final most revolutionary thing is just the entire provenance—he ability to track every bid, every sale, every previous collector, every transaction, everything that’s ever happened to one of these artworks is locked into its history and its provenance on the blockchain in a way that can never be altered with. It can never be tampered with. You just will never be able to find that in the traditional art world. I think that the big auction houses are already starting to use blockchain technology to basically verify provenance and certificates of authenticity for physical art as well. 

And so I think that the underlying technology behind all of this is clearly changing the art world. It’s happening very fast—faster than anyone could have expected. But this new world belongs to digital artists now. It’s for them to make it happen.