IN FOCUS: Opportunities and risks? Singapore creators ride NFT wave as new source of income

IN FOCUS: Opportunities and risks? Singapore creators ride NFT wave as new source of income

29/1/2022 1:21:00 AM

IN FOCUS: Opportunities and risks? Singapore creators ride NFT wave as new source of income

More local artists are entering the NFT space, drawn by the novelty of the medium and potential new income streams as they look to sell their work. As buyers hop on the bandwagon too, CNA explores the trend – and the pitfalls to beware of.

Drawn by the medium’s novelty and its seeming viability as a source of income in a country where art is often judged as a precarious career, more local creators are choosing to give NFTs a shot.“There is definitely an increase (in NFT artists in Singapore) … but slowly, because there’s still a high barrier of entry with needing to understand the background of blockchain and cryptocurrency.”

Without gatekeepers to what constitutes art, it also “democratises” creativity, said Mr Hafiiz. Other benefits include provenance – you can verify a piece’s authenticity as it is tied to the creator.This is a huge boon in addition to being able to track your work, said

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Fools and their money are soon parted.

Tiger Beer Roars Into The Metaverse With First-Ever NFT CollectionNFTs are all the rage. Malaysian streetwear pioneer, PMC (Pestle & Mortar Clothing) is roaring into the Year of the Tiger, launching an NFT (non-fungible token) collection of Lucky Tigers together with Tiger Beer. Dubbed ‘The Tiger Archives’, the NFT collection features PMC’s take on Chinese archival tiger artwork featuring Tiger Beer’s bottles through the years, each unique and fully drawn by hand. Dubbed ‘The Tiger Archives’, the collection of 6,688 NFTs features PMC’s take on Chinese archival I’ve got three of these and wish I could go to these events.

Tiger Beer Roars Into The Metaverse With First-Ever NFT CollectionNFTs are all the rage. Malaysian streetwear pioneer, PMC (Pestle & Mortar Clothing) is roaring into the Year of the Tiger, launching an NFT (non-fungible token) collection of Lucky Tigers together with Tiger Beer. Dubbed ‘The Tiger Archives’, the NFT collection features PMC’s take on Chinese archival tiger artwork featuring Tiger Beer’s bottles through the years, each unique and fully drawn by hand. Dubbed ‘The Tiger Archives’, the collection of 6,688 NFTs features PMC’s take on Chinese archival I’ve got three of these and wish I could go to these events.

Pablo Picasso Has Been Vaulted Into NFTs by His HeirsPicasso’s family is selling 1010 digital art pieces of one of his ceramic works that dates back to October 1958.

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, compared to US$95 million in 2020. A plethora of players has joined in the action too, with luxury fashion brands, newspapers and even celebrities minting their own NFTs . Drawn by the medium’s novelty and its seeming viability as a source of income in a country where art is often judged as a precarious career, more local creators are choosing to give NFTs a shot. An online art community founded in Singapore, NFTAsia , has grown to more than 3,300 members in the span of a few months, including people from other countries, said one of its founding members Jonathan Liu. “There is definitely an increase (in NFT artists in Singapore) … but slowly, because there’s still a high barrier of entry with needing to understand the background of blockchain and cryptocurrency.” Those who overcome these barriers claim that NFTs are upending the creative world, such as by allowing any work to be tokenised. That includes things that are “not usually associated with being art” such as programme code, said Mr Liu. “Game designers, spatial architects, people who work with cinema 4D, new technology softwares now have an audience,” added the visual artist and lecturer at LASALLE College of the Arts. Without gatekeepers to what constitutes art, it also “democratises” creativity, said Mr Hafiiz. Other benefits include provenance – you can verify a piece’s authenticity as it is tied to the creator. NOT JUST “COMPUTER MONEY” Receiving post-sale royalties also helps artists get more out of the value chain. Every time an NFT is resold, the creator automatically gets a portion of the sale price – typically ranging between zero and 10 per cent. This is a huge boon in addition to being able to track your work, said prominent local artist, Farizwan Fajari , known as Speak Cryptic. “If you sell the old or traditional way, maybe you get a cut from the gallery and you probably will never see it again. With NFTs, you know where the work is, you know who has it, you know how much it’s being sold for on the secondary market and it’s more transparent.” Surface #27, an NFT by Farizwan Fajari, better known as Speak Cryptic. (Image: Speak Cryptic) Surface #04, an NFT by Farizwan Fajari, better known as Speak Cryptic. (Image: Speak Cryptic) Surface #05, an NFT by Farizwan Fajari, better known as Speak Cryptic. (Image: Speak Cryptic) When he first dabbled in NFTs in March out of curiosity, decrypting the jargon was a mammoth task. But a day after creating his first NFT, it sold for 0.7 ETH, worth US$1,600 at that point. “(It wasn’t a lot) but it felt like something! Especially in that moment, where because of the pandemic, jobs were being cancelled and so on.” It was initially hard to wrap his head around the concept because it just felt like “computer money”. “But when it (showed up in my bank account), I was like: ‘Oh, this is real money and this is something that I could use to put back into my practice and to potentially also put food on the table.'” NFT sales now make up about a quarter of his projected income each month, with the rest coming from “more traditional art jobs”, such as commissioned murals, installations, workshops. For others, it has become a viable living, he said. “(Some people I met a while ago) were trying to find a balance between their nine-to-five jobs and trying to be an artist. Now, a percentage of them have already made that jump. “NFTs have made it possible for artists to just do what they want to do,” he said, though he cautioned that there are still risks in committing oneself fully to such a new realm. FOR A GOOD CAUSE As NFTs become more mainstream, others are also exploring how they can help social causes. Speaker of Parliament Tan Chuan-Jin has had a few of his landscape photographs sold as NFTs, raising more than S$54,000 for the National Gallery and about S$50,000 for the NTUC U-Care Fund. "When you go online, it’s a global market. Anyone can (contribute), anyone who feels it’s a cause they’re prepared to support," he told CNA. And if the NFT is resold, the royalties can be another income stream for the charity, he said. “That’s not bad, I suppose, if you’re raising money for social causes and if that could be part of the landscape that they could tap on.” A post shared by Tan Chuan-Jin (@chuanjin1) But he said this was not “an endorsement” of NFTs. “With all these new platforms, for every individual, the caveat is you really need to know what you’re doing. If you’re not comfortable with it, don’t get near it. As you can see from cryptocurrency like Bitcoin, it is very volatile." BUYERS EYEING A SLICE OF THE NFT PIE Beyond creators, more Singapore buyers are looking to get in on the NFT action too. According to NFT marketplace Mintable, which is headquartered here, the number of site visitors from Singapore grew from 0.72 per cent in September to 1.09 per cent in December last year. “A small increase, but it means thousands of Singaporeans every month are coming into blockchain and NFTs,” said its CEO and founder Zach Burks, adding that the site gets five to ten million monthly visitors. A report from comparison site Finder last November also showed that 6.8 per cent of Singaporean Internet users polled own NFTs. Another 11 per cent said they plan to acquire some – which is a “conservative forecast” given fast-growing awareness, said the team. The burgeoning interest in NFTs rides on a “strong gaming culture” here and a growing acceptance that “digital goods are of genuine value”, said Mr Patrick Tan, CEO and general counsel for blockchain advisory firm Novum Alpha. WHY DO THEY BUY? Sceptics may struggle to understand why some may pay eye-popping amounts for intangible items that can be viewed and shared online for free. Indeed, some of the most popular collectible NFTs, such as CryptoPunks or Bored Apes Yacht Club, which are launched in limited numbers, can trade for hundreds of thousands of dollars. 'CryptoPunk 7523,' a rare NFT from Larva Labs, is one of several of the certified digital objects being sold by auction house Sotheby's through June 10, 2021 AFP/Cindy Ord For some, it comes down to the pride of ownership, said Mr Tan. “The whole human desire to own something, to the exclusion of others, is something that’s built into our DNA," he said. “If I get something that is scarce, I'm somehow superior to others. That goes to the heart of it." He added: “It’s like a baseball card – it’s just a piece of cardboard, right? … But to the buyer, there is tremendous (intangible) value.” Like art collectors, some may also purchase NFTs because they simply appreciate their aesthetic qualities, he said. Owning these also signals membership to an exclusive community, which sometimes includes the rich and famous, such as television host Jimmy Fallon or basketball star Shaquille O’Neal. In the gaming world, NFTs can also represent special items, such as skins or weapons, that are earned by players who then . This is a rapidly-growing industry in other Southeast Asian economies. MAKING A QUICK FLIP But for some NFT collectible buyers, the motivation is simple - to “flip” them for a profit. This is the case for one buyer, who only wanted to be known as Ms Yong. The civil servant in her mid-20s has spent S$10,000 on NFTs on blockchains such as Ethereum and Terra in the past six months. One purchase was because she genuinely liked the art and it wasn’t too expensive to collect. But the others were for profit potential. To gauge if an NFT will appreciate in value, Ms Yong said: “What I take into consideration is the potential of the roadmap, the hype of the NFT, the utility.” The “utility” refers to perks such as access to digital or in-person events, or even free subsequent NFTs. “Roadmaps” are the creators’ long-term plans for the token and its value. Creators often have to seek out their own buyers, drumming up business through platforms such as Twitter or creating communities through Discord servers. “I try to mint more than one, then I’ll flip one and keep one more for the utility,” added Ms Yong. A BUBBLE WAITING TO BURST? Detractors have criticised the pervasive speculative buying in the NFT world, warning that valuations are unfounded and the frenzy is a bubble waiting to burst. The digital gold rush has also drawn no shortage of junk projects. “It’s quite clear when you see the team’s roadmap. We call it a cash grab when prices are hitting very high and you can’t explain the high price, that’s one of the red flags,” said Ms Yong. Related: NFT sales surge as speculators pile in, sceptics see bubble Some artists also lament how some creators launch “knock-off collections” of popular NFTs just to cash in. “You need to understand what's unique for you and your experience in the digital space … Not just make (for the sake of it),” said Mr Hafiiz. Mr Farizwan added: “I think as artists, we have to be very aware of that and not just jump on the so-called bandwagon because it seems like everyone's on it.” Yet, NFTAsia’s Mr Liu noted that people buying collectibles motivated by profit may not necessarily be a bad thing. “With that, comes adoption … It gets them interested in NFTs. Once it stabilises and there are more wallets, more creators, it builds itself up,” he said. CONCERNS OVER ENVIRONMENTAL IMPACT AND SCAMS Some creators have also sparked a backlash by dipping their toes into the NFT space. That includes 28-year-old Alvin Juano, the artist behind The Square Comics, an Instagram account with 600,000 followers. He launched his own collection to build capital to branch out into more types of content, with the NFTs allowing owners to propose and vote for what they wanted to see. But the move polarised his fanbase, drawing many supportive direct messages – alongside a deluge of criticism. It also lost him about 5,000 followers overnight.