In the midst of one of the worst economic downturns in recent history, crypto art and NFTs are enjoying a huge surge in popularity in the nation that was once the proud owner of the most admired financial system in the world. The leadership role among developed nations, and even the small clique of Asian ones, is no longer assured in the face of rising COVID infections, stagnating employment numbers, and an increasingly disgruntled populace. But citizens often turn to art and leisure activities as a way to allay their everyday financial difficulties. And, in an environment where most in-person social events are banned, online hobbies, crafts, and creative activities are often the only outlet bored, underemployed adults have. Such are the reasons for the current fascination among Japan’s young people with non-fungible tokens (NFTs) and crypto art.
What Are NFTs?
The phenomenon makes no sense without a couple of definitions. An NFT is a special kind of cryptocurrency token that is typically used only within the gaming community. Based on a unique form of blockchain cryptography, the secure mini-contracts allow any creator to link an artwork directly to a distinct blockchain network. What’s the result? Artists and creators of all kinds can sell rights to any digital product they want. Sellers use one of several platforms to sell NFTs, with photos, paintings, songs, GIFs, and other items being the most popular. The rule is if you can put something into a digital format, then it can be offered as an NFT.
The primary blockchain technology used for NFTs is the run created by Ethereum, though some non-fungible tokens appear on other chains. Right now, the entire digital, tokenized retail world is in its infancy, but it’s possible that widespread adoption could have an impact on the Ethereum price, which stands just under $1,954 as of mid-July.
Japan is the leading world center of crypto artistry and the many online shows that have sprung up in Tokyo and neighboring cities around the country. Young Japanese students and working people have pumped life into the new wave of digital products. One reason is the shows and gallery events are all done online, so there’s no worry about breaking pandemic lockdown restrictions. What’s selling well? Aside from a few notable celebrity items that were obviously snapped up only because they were associated with major entertainment or entrepreneurial stars, much of the NFT craze is centered around simple digital artwork. The few platforms that host sellers tend to be top-heavy with GIFs, songs, photographs, paintings, and similar fare.
Non-fungible tokens are a unique type of asset, and governments in Asia and elsewhere are already trying to figure out how to tax the sales activity. The average owner of an NFT can post any work of art for which they own the copyright, a photo of a local mountain, for example. And, while virtually anyone can copy that photo, only the buyer of the NFT has proof of the right of ownership. That proof is in the blockchain, which is what Ethereum’s smart contracts are all about.
Rescuing Small Artists from the Clutches of a Pandemic
Japan, and Tokyo in particular, has always been a hotbed of young, creative artists. When the pandemic restrictions went into place in 2020, the creative, independent sellers of artwork were deeply affected. With major and minor galleries closed indefinitely, and in-person sales events and shows banned, many artistic folks sought other work. But with the rising popularity of NFTs and crypto galleries, many of those who had assumed their artistic careers were over are returning in droves to the busy marketplace of online, digital creative products.
Drew is a financial enthusiast, seasoned blogger, music and sports fanatic. He enjoys spending time outdoors with his wife and daughter fishing and boating. He is dedicated to his 15+ year career in the banking, mortgage, and personal finance industry.