Bitcoin Global News (BGN)
September 06, 2018 -- ADVFN Crypto NewsWire -- How can we even
begin to conceptualize the idea that a work of art can be
tokenized?
In truth, it is really no different
from tokenizing anything else, including shares in a company, like
Swarm Fund is already doing. First, the art would need to be
appraised as valuable art always is. Next, the equivalent value
would be calculated in whatever digital currencies the seller wants
to represent ownership of the work.
In short, tokenizing art is the
same as tokenizing shares in a company. One argument to watch out
for, however, is that this is something novel to the global
business space.
Some may disagree strongly but the
case can be made the tokenization of shares in a company or in this
case, a work of art, is nothing more than digitizing the entire
investing process to the point where none of it involves
traditional money.
Still, the truth is a bit hazy as
the Blockchain industry is truly in its early stages.
Because this is true, we are left
with the question: how does doing so truly change the investment
process?
On Wednesday, an Andy Warhol
painting worth millions of dollars was tokenized and then sold on
the Blockchain. Through understanding how this played out, it could
be said to be easier to understand how the tokenization of assets
actually offers investors a new avenue to follow.
First and foremost, the full work
was initially appraised at $5.6 million. 800 users signed up for a
smart contract auction in order to see how much Crypto could be
raised as collateral in relation to this full valuation. It should
be noted that from the beginning, only 49% of the painting was made
available for this auction. Thus, from the beginning, the entire
asset was never going to be tokenized and it appears that the
creators of the auction intended to treat it almost like a
pilot.
In the end, the auction resulted in
$1.7 million or a 31.5% stake being the highest stake in the Warhol
work, in question and by all accounts, the 49% was allocated to 100
of the users involved.
Over the course of the auction,
everything was decided by a smart contract, which basically means
that no human actors were directly involved in the allocation of
funds and the resulting Crypto was distributed automatically. In
other words, computer code decided how the auction was run as well
as how and when it ended.
Overseeing this entire process was
the Crypto firm, Maecenas, which bills itself as the “platform that
democratizes access to fine art.” In general, Maecenas is an ERC20
based project, which means that it runs on the Ethereum network,
even though it also has its own token, which is represented by the
acronym, ART.
In the end, according to CCN, the
winning 100 participants were given digital certificates that are
tied to the Ethereum blockchain, to represent their ownership of
the painting. To recap, tying ownership to the Blockchain in this
fashion essentially amounts to a foundational use case of the
technology, which includes using it as a ledger for something other
than transactions with currency.
By: BGN Editorial Staff
News:
Tokens
Cryptocurrencies