The art market has been through some big changes in the past few years. It suffered a tremendous impact after the 2007 financial crisis, but it grew until the beginning of the COVID pandemic, hitting a staggering $67.4B in sales in 2018. By 2020 it fell 27% from that point, landing at $50B in sales. Nonetheless, some sectors within the market experienced exponential growth. Despite the significant drop in overall sales, total internet sales hit a new high of $12.4B in 2020, more than double from the previous year. Online sales increased from representing 9% of the value of sales in 2019 to 25% in 2020, marking the first time that e-commerce has surpassed general retail in the art market. Another interesting fact that depicts a switch in the market are sales made through social media. In 2020, they remained a major avenue for the art market to attract new audiences and create sales, with nearly a third of collectors purchasing art on Instagram only. The game is changing and it’s changing fast, mainly thanks to the introduction of blockchain technology. More online platforms will accept cryptocurrency payments in the near future, with nearly four in ten (38%) planning to do so within the next year, a significant increase from last year (15%).
The Contemporary Art Market
When we take a closer look at what is happening in the contemporary art market, meaning the commercial exchange of artworks made by living artists, we can see that this is a much more dynamic sector of the market. If we consider auctions, which represent 35% of the overall market sales, contemporary art now accounts for 23% of those, a 117% jump from 2020, or 2,700% since the year 2000. This translates into a value of $2.7B (in auctions only), which is comparable to the total value of NFTs transactions in the first half of 2021 ($2.5B). Nonetheless, NFTs are the new kids on the block. In the same period in 2020, the total value of NFTs transactions was only $13.7M. So, how do we go from $13.7M to $2.5B, meaning an 18,000% increase, in only one year?
Well, in art2act we believe that this fantastic rise is due to the fact that NFTs are community-based artistic projects. They are not curated by a few stakeholders who decide what is good or not in the arts. The community decides what they like and what they buy, without any filters or middlemen. When we, as a community, decide to apply the same principle to the contemporary art market, more people will join in and participate. This means more cultural development, new techniques, a higher capitalisation and a larger distribution of the capital. That is what art2act is here to do: empower artists, invest in culture, improve market inefficiencies, take down intermediaries and decentralize the contemporary art market, with every tool blockchain technology has to offer.