Your Bitcoins Are Hidden in the Painting

(Bloomberg Businessweek) -- Marguerite deCourcelle lives at the peculiar intersection of Bitcoin and art. Under the pseudonym @coin_artist, she’s credited with inventing the crypto-art puzzle, a genre of images hiding complicated ciphers that reward the first solver with a walletful of virtual currency. The most famous of these is an @coin_artist oil pastel from 2015 called Torched H34R7S, the final work in a series known as The Legend of Satoshi Nakamoto. Depicting a ­turtledove, chess pieces, and a ­phoenix surrounded by flames, the painting incorporates symbolic references to Bitcoin’s creator, as well as to Shakespeare and deCourcelle’s personal life. An anonymous person solved the riddle in 2018, unlocking 5 Bitcoins, at the time worth about $50,000.

DeCourcelle started the Bitcoin-art-puzzle phenomenon in 2014 with Dark Wallet Puzzle, a painting of two leading crypto anarchists that hides a key. It led to a 3.4-Bitcoin reward. “I created it after realizing that without a third party litigating how money moves, that money could be ‘pulled out’ of anything,” she says.

Until recently, most hidden-crypto-key artworks had been known only to nerdy collectors, their images circulated on websites such as Reddit and BitcoinTalk. Now they’re starting to enter the mainstream through galleries, museums, international exhibitions, and even video games. Many of the puzzles are also getting a bit easier to solve, giving more people a chance to crack the code and claim the coins. Some collectors are buying the art even after the puzzle has been solved and the ­digital currency extracted.

This spring artist Andy Bauch showcased “New Money,” a collection of mosaics, at the Castelli Art Space in Los Angeles. The patterns in the pieces, which were made of thousands of Lego blocks and included a 4-by-9-foot horizontal triptych, contained clues to troves of Bitcoin and other ­cryptocurrencies. “How seemingly arbitrary art prices are, and seeing crypto prices fluctuating wildly, I was curious,” Bauch says. “Will the ­cryptocurrency I put in this art appreciate? Will the art itself appreciate regardless of the cryptocurrency?” Three of his works have sold—one of them for $14,000—though the virtual coins hidden within one had already been taken before the show began. Per the unspoken rules of the ­crypto-art crowd, Bauch had posted photos of the works online, where anyone could view them and try to ­decipher their riddles.

The pieces are also getting some high-­profile attention from the art world. The Whitney Museum of American Art in New York plans to show a 16-millimeter film by Jennifer and Kevin McCoy that offers clues to a Bitcoin address. The first solver will be named as one of the official donors of the piece, a distinction that can be resold or traded. At Bitcoin Art (r)evolution in Paris this fall, some 1,000 visitors in the course of a week viewed 40 works from @coin_artist and others, organizer Pascal Boyart says. He plans to embed crypto-art puzzles in his murals in the city’s streets.

The broadest adoption of the puzzles, and maybe the best chance to make money, could come with video games. That’s the path deCourcelle is taking: In January 2018 she launched Blockade Games Inc. In March the company released a site filled with puzzle games called Pineapple Arcade—one complicated Rubik’s Cube-type puzzle looks like the fruit—­offering to pay out prizes totaling more than 17.5 Bitcoins (more than $64,000) and 15 Ether (about $1,755). DeCourcelle says even children should be able to solve puzzles for crypto prizes. Starting in early January, they’ll be able to trade parts of animated bears for Ether in the game Plasma Bears. The venture has gained some early momentum—Blockade raised $833,000 in a funding round late in 2018, valuing the company at $13 million.

DeCourcelle, who has an art degree from Eastern Oregon University, made the final piece of The Legend of Satoshi Nakamoto series when she found herself suddenly single and parenting two small children, living in a rented room at a friend’s house with no steady means of support. She spent four months working at night, during her boys’ naptimes, and between freelance projects to finish the painting, for which she’d already pledged 3.5 of her own Bitcoins in prize money. She survived in the meantime by selling the original Dark Wallet Puzzle painting for 10 Bitcoins, or about $3,000 at the time.

“I just wanted a piece of that history,” says buyer Brooke Royse-Mallers, a Bitcoin investor and avid crypto-puzzle-solver. “The history of Bitcoin’s evolution and my evolution with it, I guess. That painting helped me learn more about the technology without being a coder.”

Most crypto art isn’t fetching much money by art-world standards, and the puzzles’ value as investments remains unproven. Still, deCourcelle says she’s been offered as much as $1 million over the years for Torched H34R7S. It’s still in her hands—­sentimental value—even though, she says, “I should have probably sold it.” 

To contact the editor responsible for this story: Jillian Ward at jward56@bloomberg.net, Jeff Muskus

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