Collectible NFTs vs. Fine Art NFTs — What is the Difference?
There is an abundance of collectible NFTs on the market today. You can also find some fine art NFTs if you try. But, you have to know what to look for.
So, what’s the difference? And, why does it matter?
Collectible NFTs
You can think of collectible NFTs as being like baseball cards. They are not particularly artistic, but they are fun to collect.
Like baseball cards, collectible NFTs are produced in large numbers. And, like baseball cards, there is a rarity factor built in that is designed to make some more valuable than others.
As with baseball cards, the price of collectible NFTs is largely based on the number of collectors. If the number of collectors is large compared to the supply, the prices can get driven up. This brings in even more “collectors” seeking to profit from the price appreciation.
Collectible markets tend to focus on this price factor, rather than aesthetics or utility. If price appreciation is the only guiding value, it is easy for prices to get pushed to unsustainable levels.
That is the definition of a “bubble”: Prices getting driven artificially high by speculation.
This paints a fairly clear picture of the state of the collectible NFT market for the past year or so. Until recently.
One danger for the current collectible NFT market lies in the many new collections that are appearing every day. Each of these new entrants adds thousands of new collectibles to the market. This threatens to dilute the demand for older collections.
Another danger is the weakening macro-economic picture. And it is made worse by the weakness of cryptocurrency prices.
For various reasons, collectible NFT prices have “softened” in recent months. If this trend continues, a price collapse could follow, as NFT holders rush for the exits.
Fine Art NFTs
When we discuss Fine Art NFTs we are often talking about “tokenized” representations of a physical piece of artwork. The artist takes a high-resolution digital picture of the original. Then, the digital image is “tokenized” as an NFT.
In other cases, fine art can be produced in digital form from the beginning.
In either case, it is not unusual for the artist to stipulate the buyer of the NFT is also buying ownership of the original.
Various forms of fine art have been available for millennia. Artists and collectors have been successfully selling and buying that art without the help of NFTs all that time.
So, why even bother adding NFTs into the mix?
Artists and collectors of fine art have discovered that NFTs can solve some problems that have existed in the art market for years.
Collectors want to be able to verify the authenticity of fine art that they buy. NFTs provide an immutable record of ownership from the creation of the piece to the present.
Artists want to be able to display their work and offer it for sale in a variety of venues. NFTs make this easy because the same NFT can be displayed in many different NFT marketplaces at the same time.
Artists have historically only been paid for their work at the time that the art is initially sold to the first buyer. NFTs allow the artist to receive a commission from the sales of their work, every time the piece changes hands.
NFTs can also allow the artist to make more money on the initial sale of their work. This is because the sales commission charged by most NFT marketplaces is low. It is usually a smaller percentage of the sales price than is charged by brick-and-mortar galleries.
Why Make a Distinction?
My point in all this is not to say or imply that collectible NFTs are not art. Nor am I implying that they are less valuable.
I’m only trying to provide some understanding of the differences.
Anyone dealing in the NFT market needs to be clear about these differences. And buyers need to be honest about their purpose.
If your reason for buying an NFT is price speculation, you belong on the collectible side of the market. But, you should understand the risks you are taking.
If your primary focus is creative expression and artistic quality, you belong in the fine art side of the market. There, you may be less subject to wild price fluctuations.
And, if you are on the fine art side of the market, you are buying based on beauty and aesthetics. In the very worst case, you will end up owning a piece of art that you enjoy and find attractive.
Can “Fine Art” and Collectibles Co-Exist?
AvatArt Studios is experimenting with the concept of Artistic NFTs that are also Collectible.
The concept is simple: Use artificial intelligence to create collections of NFTs that are beautiful enough to be art.
You can see more examples of “Artistic Collectibles” here.
(Full disclosure: I am the artist and owner of AvatArt Studios. So, I am not unbiased.)
About AvatArt NFT Studios
AvatArt Studios is the creator of collections of original and unique ART NFTs. We create our NFTs with the help of artificial intelligence (AI). This is completely different from the “generative” process used by all the apes, punks, cats, dogs, birds, bears, pandas, frogs, warriors, aliens, robots, dragons, goblins, unicorns, and so on. It produces NFTs that are unusual, attractive, and distinctive.
AvatArt Studios has introduced three “cross-over” NFT collections. This means they fit into both the “Art NFT” and the “Collectible NFT” categories.
And, we promise not to over-hype or make exaggerated claims to market our artwork.
Please visit our website to see samples of our “artistic collectibles”.
About the Author
Richard Crites is the founder and artist at AvatArt NFT Studios. He is also CEO and Founder of OmniBazaar, Inc. He has 40+ years of entrepreneurial success and exits in four separate industries. Rick earned a master’s degree in Aerospace Engineering from Stanford University. He has been active in cryptocurrency and blockchain since 2013.
Follow Rick’s writing on Medium.
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