Blockchain Art Chipping — Still a Work In Progress
Tags: Investment, Fine Art, Art, Maecenas, Blockchain

Buying and selling artworks online has revolutionised the way the art market works. However, when deciding to buy an artwork, whether in the form of tokenized shares, or in the traditional way of collecting the physical artwork, trust remains a vital component. The 2018 annual Hiscox report found more than 50% of collectors were held back from buying works of art online due to the fear of buying a fake.

Old-school authentication has relied on expert opinions; in other words, connoisseurship. For centuries, seasoned art-historians and specialists gathered to decide whether a painting was authentic or not. But, multiple cases have proven that not only can the human eye be easily tricked, but scientific methods can also be manipulated.

Stepping into the 21st century, new art business organisations such as Maecenas are focused on offering authentic artworks with impeccable provenance and condition reports.

Our rigorous and thorough due diligence procedure is still based on our experts’ vetting process. But it is now more important than ever to explore new, decentralised tools when determining the authenticity of an artwork.

Electronic or online tagging has been touted as the ideal solution to allay buyers’ worries. Registering crucial data-points in the blockchain, such as ownership history, important exhibitions, shipping documentation and so on, allows owners to track an artwork’s complete history and physical movements. In this way, blockchain technology, perhaps best known for originally serving as the public ledger for bitcoin, has created an opportunity to build a secure database for artworks too. Just as any mined bitcoin can be verified and tracked, tagged artworks can be as well through a similar database.

Verified Art Work

Companies, like Verisart or Monegraph, are already providing token verification, which serves as a certification of authenticity. When an artwork is sold, the new owner receives a digital token that serves to registers his/her new acquisition online, and adding a new block in the time stamp of the blockchain. Consequently, if all information is properly uploaded to a trusted and secure provider, forgeries can be readily identified. For the system to fulfil its promise, it is necessary to have a secure and accessible database in place. Ultimately though, the onus falls on all art buyers, sellers and artists to submit the necessary information accurately to the database.

At the same time, some sceptics of online tagging have argued for a more conventional method of physically (i.e. “offline”) tagging/chipping artworks. Conventional in its form, but cutting-edge in its execution, the tag functions as the artwork’s synthetic DNA. Don’t be afraid of the scientific description. In layman’s terms, it simply refers to a unique signature or stamp, which is — preferably — immediately attached to the artwork after its completion, the size of a small coin or stamp. This supposedly tamper-proof synthetic DNA label is applied by the artists themselves or by a company specialised in the technology, such as Tagsmart. After the work is tagged, its unique serial number is registered in the Tagsmart online database and can be checked and confirmed at any point of time. However, while the tag could confirm the work’s authenticity, it wouldn’t provide comprehensive information on its provenance.

A third method, by the New York-based technology company, Blockchain Art Collective, is designed to create a blockchain-based registry, with the addition of physical NFC tags, attached to the works themselves. The artwork can then be scanned by a mobile application and new information added to the company’s database.

Who Tags the Art?

Whether it is online or offline chipping, each artwork has to be modified with the addition of a tag and to-date there is little evidence that these different tagging methods are actually tamper-proof.

This solution might work for living artists, assuming that the artists themselves apply the chip at the time of creation, but it is less helpful with authenticity issues of Old Masters or any works where the artists are no longer living.

In those cases, the questions remain — who is responsible for applying the tag; are they liable; and most importantly, will this actually resolve any trust issues?

At this point, it is difficult to say whether the online, offline or their combined methods will bring us closer to a 100% forgery-free art world. Perhaps a combination of them could. But it is safe to state that keeping our eyes open for the latest technological innovations will hopefully help us access a more democratized and transparent art world.