The Winklevoss Twins Cold-Called Daniel Arsham to Sell Him on NFTs

Bookmark

Two years ago, when Tyler Winklevoss acquired the online marketplace Nifty Gateway with his brother Cameron, NFTs were still a long way from going mainstream.

To popularize the site, which sells digital artwork tied to non-fungible tokens (essentially digital certificates of authenticity), “Our feeling was great content and great creators was what would make the difference,” Tyler says in a phone interview. So the Winklevoss twins drew up a wishlist of artists they wanted to work with and began to send them direct messages on Twitter and Instagram.

“It was very grassroots,” he says. “The majority of outreach happened on social media.”

Initially, enthusiasm could generously be described as muted. “If I tried to describe what an NFT was, the hit-rate was a lot lower than if I just said ‘Hey, I’ve got a crypto idea I’d like to discuss with you,’” Tyler says.

One of the first people who got back to him was Daniel Arsham, a fine artist whose monochromatic sculptures appeal to high-end collectors and street art fans alike. “To his credit, he totally got it and he was open-minded enough to meet with us in 2019,” Tyler says. “This was before there was anything on the internet [about NFTs]—no rooms in Clubhouse talking about this thing—and he got the idea.”

Two years later, the efforts of that first DM have borne fruit.

On May 22, the first of 10 NFTs designed by Arsham, which he calls “digital sculptures” will be released on Nifty Gateway. The first release, titled Eroding and Reforming Bust of Rome (One Year), will be an unlimited edition costing $1,500; the subsequent artworks will be in editions of decreasing size, with the 10th an edition of just 50. Anyone who buys all 10 will get an 11th for free—a sort of high-stakes, “buy one/get one free” sales structure that has been used by other NFT stars, including the anonymous digital artist Pak.

The Winklevoss Twins Cold-Called Daniel Arsham to Sell Him on NFTs

The dates and prices for the subsequent artworks are still “under discussion,” according to a representative for Nifty Gateway. 

“Daniel waited for the moment where he could really harness the medium in a way that could demonstrate to collectors—and frankly, the whole art world—what is exactly possible with programmable art,” says Tyler. “He didn’t just jump in immediately.”

A Question of Timing

While this is a testament to Arsham’s methodical approach to making art, it also could mean he’s missed the initial NFT gold rush. 

In the past 30 days, the number of daily sales has steadily decreased, from nearly 151,000 on April 11 to 119,000 on May 10, according to the market analyst NonFungible. Similarly, the site shows the number of unique buyers of NFTs down more than 15% during the same time period, the number of unique sellers down almost 25%, and active market wallets—meaning the number of accounts that are being used to buy and sell NFTs—down almost 19%.

The only bright spot is the actual dollar amount of the sales, which jumped after Mike Winkelmann, who goes by the artist name Beeple, released his “Spring/Summer Collection 2021” on Nifty Gateway from late April into early May, selling dozens of artworks for several million dollars.

Meanwhile, high-profile digital artists who’ve taken to traditional auction house platforms have seen diminishing returns. After Beeple’s NFT sold at Christie’s in March for $69.3 million, Sotheby’s multiday sale of work in April by the anonymous  Pak netted a comparatively modest $16.8 million; a week later, Phillips sold an NFT (which, in fact, was hundreds of NFTs) by the artist Mad Dog Jones for a yield of just $4.1 million. 

Tyler Winklevoss argues that NFT collectors need to take a longer view.

“In the short term, there might be a little bit less of a frenzy,” he says. “But long term, it all works its way out, and great pieces will be collected.” Indeed, he argues that “primary sales have cooled off, but the health of a drop is not just judged, in my mind, by the primary market sales, but actually how it does on the secondary market in the long run.” (Not coincidentally, he notes that Nifty Gateway takes a 5% cut of all secondary market sales.)

“Yayoi Kusama was never recognized during the first couple of decades of her life, but I find that her 1950s and 1960s infinity nets are the works I gravitate towards most,” he continues. “If, in the 1960s, her infinity nets were a [NFT] drop, it would have been less successful than in her later years. But of course, we know how her earlier work has developed over time—and that, for me, is the more exciting story.”

The Art

Arsham, for his part, is also excited about the future, albeit for slightly different reasons.

After meeting with the Winklevoss twins, “I thought the idea of digital artwork wasn’t super interesting to me at that moment,” Arsham says, “but I was super interested in the blockchain certification [component] of it, because I’d been interested in ways to authenticate my works.” One thing that Tyler said stuck with him, though: “He said that because the smart contracts are present on Ethereum [a blockchain technology], you could alter something over time.”

The Winklevoss Twins Cold-Called Daniel Arsham to Sell Him on NFTs

This, Arsham says, is particularly interesting to him, “because so much of my work is invested in thinking about our experience of time.” As he went into lockdown, “I had this idea of a work that would change over the seasons—it would erode and re-form over the years,” Arsham says.

The work that will be released on May 22 will be timed to the seasons. “It will be late spring, so there will be cherry blossoms and birds and butterflies everywhere,” Arsham says. “But the artwork will also be in a state of erosion.” As the seasons change, the artwork will fall apart, then re-form, and then fall apart again. 

So, Arsham continues, will the other nine artworks in the series, the twist being that “they operate on different time scales. So the first operates over the course of the year, others may operate on a 50- or even 1,000-year time scale, and I think one of the interesting things here is to create an artwork that’s longer than our own lifespan. The person who acquires it never gets to experience it to completion.”

The Winklevoss Twins Cold-Called Daniel Arsham to Sell Him on NFTs

But given Arsham’s mass popularity—he has over 1 million Instagram  followers and has done artist collaborations with Adidas, Dior, Disney, Heinz, Pokémon, Porsche, and Rimowa, to cite a partial list—there’s reason to believe his NFTs could buck the industry’s downward trend. 

Celebrity Staying Power

And that, Tyler says, is “where Daniel’s established nature will ultimately come into play. He sells out [editions] all the time.” (Recent sales include sculptures of eroded surf boards, cell phones, and cassette players.) “There’s going to be less of a speculative crowd who doesn’t really know him.”

Arsham agrees: “When I do an edition of 500 works, it typically sells out in a minute or less,” he says of works that usually sell for $1,000 to $2,500.

He concludes: “Every single person—or collector—who I’ve shown this to is immediately like, ‘Yeah, I need one of those.’”

©2021 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.