A blockchain company bought a $95,000 Banksy artwork, burned it and broadcast it live on Twitter -- all part of a process of turning the work into a virtual asset called a non-fungible token, or NFT. CBSN technology reporter Dan Patterson joins CBSN anchor Lana Zak to explain what it all means.
Video TranscriptLANA ZAK: A group of crypto enthusiasts recently purchased a piece of artwork by the mysterious street artist Banksy. And then, they burned it. The blockchain company called Injective Protocol bought the screen print "Morons" for nearly $100,000 from a New York art gallery.
The company says the virtual asset will now be sold as a non- fungible token, or NFT. Our CBSN technology reporter Dan Patterson wrote about this, and Dan joins us now to discuss.
OK, Dan. I read your article about this. I've read lots of other articles about this. And I'm still scratching my head about what happened here. What does it even mean that they made a digital representation of the art and then turned it into a non-fungible token?
DAN PATTERSON: That is an excellent question, Lana. So bear with me. This is going to sound a little jargony. But it's kind of-- you can kind of wrap your head around it-- not the destruction of art, but the NFT part. So non-fungible tokens are blockchain based technology that really just make digital assets unique or one of a kind.
So as we know, photos or videos can be copied digitally infinitely. And what the NFT does is use a smart contract that uses blockchain tech to make sure that one piece of artwork, or a video, or even a video game trading card is the only representation of that, that exists.
And the reason this group was doing that was to, in their words, inject trust into the NFT system and show that we think that it is so valuable we can destroy a piece of art-- not something I endorse-- but we can destroy a piece of art and transfer it into a digital token with exceptional value. Now, their auction is online right now. So we're kind of figuring out whether that will bear out or not in real time.
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LANA ZAK: OK, I am still trying to understand what went on here. So Dan, NFTs have become very popular all of a sudden. Is this an attempt-- you said that they did it-- at least, they claim to have done it because they wanted to inject trust into the NFT system.
But does that mean that they think that they're going to make money off of this-- this stunt? And then I guess the other part of this is, the digital representation, is that a digital copy, then? A unique digital copy of the piece of art that they've now burned?
DAN PATTERSON: Yeah, well, they said, when I asked if they will make money off of this, they said, I have no idea, probably not, and that this was really more of an artwork exhibition in itself that also contains this, what they call, minting of the NFT digital asset. So you know, we really don't know what the value is.
These things are white hot right now. You know, the markets are kind of going crazy. But it's now the wild west of NFTs. However, you know, we see a lot of kind of mainstream artists pick this up. Yesterday, the band Kings of Leon announced that they would release a NFT album. So you know, hot or not, this tech is here to stay.
LANA ZAK: All right, well, the burning of this artwork in itself, a kind of other art piece, was livestreamed on social media. Here's what Injective Protocol had to say.
- The goal here is to inspire. We want to inspire technology enthusiasts, and we want to inspire artists. We want to inspire artists and we want to explore a new medium for artistic expression.
LANA ZAK: All right so I'm going to get a little bit meta here, Dan. Forgive me, audience. But I can't help but think that the piece of art, "Morons," which shows an art auction, is symbolic in-- in being selected as a piece of art to then be burned and sold off as an NFT.
DAN PATTERSON: Look, if you are familiar with the piece-- and please, Google our story or even the artwork itself. You can read the text on it that says something to the effect that I can't believe you morons paid for this expletive. And of course this is meta. Everything about not just Banksy's art, but crypto and NFT, is all about being meta.
So you know, whether you agree with this or you don't agree with the burning of art-- and again, I don't agree with the burning of art-- it is impossible to see this as anything other than something that is kind of defining the future of technology. And it fuses art in a really interesting and unique way. Yes, it is a stunt, but it is something that is itself, the act, wholly unique.
LANA ZAK: Oh. You know, it's interesting-- in your article, you also mentioned that the art house that sold it for about $100,000 had no idea that this was what was going to happen to this piece of art. It's also interesting too, Dan, that this is a print in and of itself. So it's not like this was the only version that's out there.
And even in your own copy of the story you can see-- as you say, you can Google online and see the print. So it's not really like it isn't going to exist online anymore. But all of that sort of leads me to-- to thinking about this at a bigger level. So all this hype surrounding NFT-- and as you mentioned, there are other people who are getting in on this-- what do critics or economists have to say about this?
I know that when we were talking about cryptocurrency even five years ago, it didn't seem like it was going to become as established as it is. Are NFTs the next cryptocurrency? Are they going to become legitimized in a way that actually turns a profit?
DAN PATTERSON: Well, I think a lot of people involved in this space would like to, much like how-- and you know, my dog Fred also objects to the burning of art, as you can hear--
LANA ZAK: He seems to agree.
DAN PATTERSON: --him verbalize. But you know, look, when I talk to skeptics, they tell me that, hey, look, this is a lot like collecting sports items. And there's a kind of a fast and furious rough and tumble nature to this, but it will really bear out over time.
I talked to Drew Olanoff at TechCrunch who told me that, you know, there's a potential upside for artists, but maybe not necessarily for consumers. And I am constantly reminded, especially when reporting this story, of what another artist said, Flavor Flav, about art, and that was-- or, at least, hype-- don't believe it.
LANA ZAK: Interesting that your dog decided to stop barking at us once you quoted Flavor Flav. I think that it was basically just that you and I are out of our lanes when we're talking about the depths of the art world. Dan Patterson, thank you.
DAN PATTERSON: Great to see you.
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