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On June 8, 2021, the Foo Fighters announced a plan to reopen one of the most iconic venues in the world, Madison Square Garden. The pandemic had sucked the energy from every corner of one of the most vibrant cities in the world. And after 476 days, everyone in New York City was ready to get that energy back.

The show was set to take place 12 days later. Whether you were a fan or not, you wanted to be in that room. You wanted to be a tiny part of that history—that community. You wanted to feel that energy. Naturally, the Ticketmaster website was bombarded the morning seats went on sale, and inevitably, thousands of fans missed out.

Those who made it to the transaction page were greeted with a laundry list of fees, commissions and whatever else Ticketmaster decided to tack on that day. Yes, these charges always feel like a raw deal, but if you’ve ever attended a ticketed event, you already know this. And you either pay to play, or you don’t. Either way, with vendors like Ticketmaster, you have a transaction, transparency and a choice.

What is a Secondary Market?

Ticketmaster represents what we’ll call a “legitimate secondary market.” It may feel unfair, but it’s an effective business model where everyone gets paid ­– and [for the time being] and we’ve all sort of collectively accepted it. In this “legitimate secondary market,” the fan gets the lowest market rate available, the ticket vendor gets its money, and the artist, crew and venue get paid. This system has its flaws, but overall, it’s a straightforward transaction.

Now, for those who missed out on acquiring their tickets from the “legitimate secondary market,” there is usually one other option ­– scalpers.

Scalpers represent what we’ll call the “illegitimate secondary market,” otherwise known as the re-sale market. And like any shady, unregulated operation, there are risks involved. These risks may include counterfeit tickets, financial loss and in some cases, personal safety. But once a representative from this “illegitimate secondary market” gets their hands on those sought-after tickets, the new value of those tickets becomes fair game.

The profit from the new ticket sale goes directly to the reseller ­– the anonymous little lurker hiding in the corner counting his undeserved cash stash. And the fans and artists ­– the ones responsible for the whole vibe of the event ­– basically get screwed.

But, whatever. It’s no big secret that fans and artists have long been taken advantage of – this has been going on for years, but there’s never really been a solution ­– here’s why…

Secondary Markets in the Traditional Art World

Historically, secondary markets have been difficult to track, especially in the art world, where transactions are cloaked in anonymity. Once artists sell their work, they are essentially in the dark when that work changes hands. It can be held or re-sold over and over. The artist has no say and sees no revenue from future sales.

The information about the status of an artwork in secondary markets is usually only available to established artists with a ton of institutional support. These artists make their sales through galleries and auction giants like Sotheby’s and Christie’s. They know where their work goes and how much it goes for, and they often have access to the records that track the trajectory of that work indefinitely. But these artists only represent the [probably less than] one percent of the creator economy. So, what about the other 99% of artists and creators out there?

We all know that capitalism has a way of attributing “value.” And in the art world, the current standards of “value” are established by a completely artificial infrastructure that leaves most artists surviving and very few thriving. Basically, at some point, this complex infrastructure somehow became the authority on what constitutes “valuable” art.

If an artist’s work wasn’t seen as “valuable” within this system, they were lucky to sell anything. And if they did sell a piece, they’d get paid. Once. Their buyer would then take the piece and either keep it, love it, store it, or flip it [usually for a profit]. For any artist creating within this system, things sucked. Every [meager] transaction meant losing all connection to their work, and any future financial gains made on that work. And like every great structure in modern capitalism, it resembled a pyramid ­– one where the artist was nowhere near the top.

But what if it didn’t have to be this way? What if an artist had access to a tangible record of their work’s ongoing journey indefinitely? And, what if they got to benefit from that journey?

What are NFTs, and How are They Changing Secondary Markets in the Art World?

An NFT (Non-Fungible Token) is a digital asset that represents a real-world object like art, music or a video. The creation and lifecycle of an NFT looks something like this:

An artist creates a piece. They then sell that piece on the blockchain. As part of the contract for their sale, they keep an ongoing stake in that piece. This stake allows the artist to see everything – who is holding their piece, when it is sold, and who it is sold to. And every time the piece changes hands, an automatic royalty payment is transferred to the artist’s digital wallet.

Everyone who participates also remains invested in the work. Everyone – the artist, the collector(s) – all stay connected to the legacy of the work through this chain. A community of support gets built around the work, providing resources that allow the artist to continue producing more art. These resources come in the form of networking, promotions and financial gain.

Secondary markets in the NFT space no longer resemble a pyramid structure but a circular one. This circular structure is reinforced by values like support, community and a shared desire to connect and create.

An NFT also protects the rights of all parties involved ­– here’s how:

Artists’ rights to royalties are baked into the transaction.
A few lines of code and no legal intervention ensure that the artist earns in perpetuity every time their work changes hands. This means that the artist has the potential to earn passive income on their work indefinitely. 

Collectors are protected from fraud.
In the traditional art world, counterfeits are a collector’s biggest nightmare. If you’ve ever seen the film, Who the #$&% Is Jackson Pollock? you know what we’re talking about. Long story short – a woman finds a painting, someone tells her that the painting could be an authentic Jackson Pollock, and the art world turns upside down. How could such a tight-knit world of elite professionals misplace a work by one of the most famous artists of the 20th Century? Naturally, there were a lot of skeptics.

With NFTs, this can’t happen. The entire history of ownership is on the blockchain. For collectors, this means simple transactions and guaranteed authenticity.

Advice for Artists: Make NFTs Work for You

There is plenty of room in the creator economy. And, if you’re talented and creating art already, it’s time to jump headfirst into this space. Here are a few tips to get you started:

Lease Your Soul, Don’t Sell it.
Old you: Sell your work. Give away your rights. Lose your connection.
New you: Sell your work as NFTs and benefit from its ongoing success.

Sell to a buyer who wants to be a part of your journey. These are the people who will provide you with ongoing support and help you flourish as an artist.

Forget the Elite. Find Your Peeps.
This isn’t about tracking down the few big players in the elusive art world anymore. Let go of trying to fit into that space. Find people who genuinely love your work. Find ones who are excited about your journey and will support you every step of the way.

Make Some Damn Money.
This one is simple. Stop letting people ask you to come over to help with a “quick sketch.” Stop allowing people who “love your work” to give you an insultingly low offer that doesn’t even cover your supplies. By all means, keep making physical art for your enjoyment. Give it away if you want to. Sell it. But, for the love of baby ye, turn that masterpiece into an NFT – and make some bank on it! Because friend, you deserve to eat just like everyone else.

Be the Change.
Cliché, I know. Bear with us, though. Look at the world around you right now. Who is making money? How are they making that money?

Much of the current flow of capital values destruction. Destruction of the environment. Destruction of human rights. This system is structured to make a few rich, leaving the rest to hold the queue. But this is changing. And creators are at the forefront of this change. As more creators get involved in the market, the market becomes more powerful. Powerful markets shape systems. Imagine systems where creators were in charge rather than destroyers.

This is a Revolution for Artists and Creators Everywhere

NFTs started with art, yes. But if you’ve read this far, then take my advice: stay on top of this technology because it will continue to spill over into every corner of the creative economy and beyond (yes, I’m looking at you ticket vendors and live performers). This shift in the way secondary markets are structured is establishing sustainable career options for creatives everywhere. There is infinite potential in the NFT space for those who create and participate. This is the game that is changing everything.


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