Two artists want to take on the art-world hierarchy with a website selling art with prices quoted in bitcoin.
The artists, Andy Boot and Valentin Rurhy, both based in Vienna, have created an online platform selling work by international contemporary artists. The twist is that its exhibitions are ephemeral. Cointemporary.com only features one artist every seven days, and there's no way for buyers to purchase works if they missed the original showing.
Artists can also choose to accept payment in bitcoin and will receive a greater share of the proceeds than they would at most traditional galleries.
As Ruhry sees it, the top-heavy art economy, dominated by a cadre of elite dealers and gallerists, could benefit from some of the disruptive effects of a decentralised cryptocurrency:
"The whole art world is very centralised. There are only a few gatekeepers who decide who will be the next big star, who will show at [for example] Art Basel."
Cracking the Silicon Valley art market
The moneyed technologists of Silicon Valley know something about disruption. They have also long been a coveted customer demographic for art dealers. Getting the Valley's elite interested in buying art was the main motivation behind Silicon Valley Contemporary – an art fair that was organised for the first time three months ago, according to Artnet News, a trade title covering the art world.
The fair was geared towards technologists by exhibiting new media works. Bitcoin made an appearance both as a medium of payment and subject matter for the artworks themselves. Artnet reported that, within a half hour of the event, a sale had already been agreed, and settled in bitcoin, for a painting by Dana Louise Kirkpatrick featuring the bitcoin logo.
Another artist whose work has featured bitcoin prominently is San Francisco-based Tom Loughlin. His 2014 piece 'Bitcoin Payday' is a neon sign designed to mimic the look of a payday lender's window sign in downtown San Francisco. It was installed at Google in Mountain View and will be hung at the Jack Fischer Gallery in the City soon, according to the San Francisco Chronicle.
Loughlin took his bitcoin interest further by attempting to bid for the seized Silk Road bitcoin that was auctioned by the US Marshals Service with his piece Bitcoin Payday instead of the expected US dollars. The piece is priced at $13,500.
As the Chronicle reports, Loughlin's bid was driven by an insight into the economic value of art and its parallels with bitcoin and other decentralised cryptocurrencies. Loughlin's thought was that both art and bitcoin have seemingly arbitrary values. Ruhry, of Cointemporary, echoes Loughlin's insight.
"Art is like bitcoin in that there is no intrinsic value. Why does a certain amount of canvas with a certain amount of colour on it cost $20,000 while the next work is $2,000? If you look at the materials, they're the same, right? It's almost impossible to value artworks, and it's almost impossible to value currencies."
Cointemporary's currency risk
Artists are warming to the the idea of accepting bitcoin for their works, Ruhry said. According to him, artists who consign their works to Cointemporary are given the choice of taking payment in fiat currency or bitcoin. Cointemporary gives an incentive to artists who accept payment in bitcoin by offering a larger cut of the sale price, or 70%, compared to a fiat payout, which yields 60%.
"We are quite surprised by how well [Cointemporary] has been received in the art world. We were really afraid, to be honest [...] artists could say we are trying to rip them off, but it's the opposite. We have a long pipeline, we can't have any new artists, we're fully booked."
Cointemporary agrees on the price of a work with the artist before it is exhibited on the website. The price is then converted to bitcoin using the average bitcoin price over the last 24-hours at the point it is listed.
Because of the way Cointemporary sets its bitcoin prices, there is a chance that the market may move against it before a piece is sold. Ruhry and Boot have to bear the exchange rate risk as a result. Ruhry pointed out that buyers could also exploit a fluctuating bitcoin price by purchasing a work when the cryptocurrency was weak and then offloading it when the price rose.
"If the artist is paid in US dollars or euro, we bear the risk if the price [of bitcoin] goes down. Then of course, we have to exchange more of our own bitcoin [to make up the difference]," Ruhry said.
Cointemporary consigns pieces from artists who work across a range of media. It launched at the end of May with works by Swiss photographer Beat Streuli, who has exhibited at London's Tate Gallery and Chicago's Museum of Contemporary Art. Recent weeks have featured work ranging from paintings by New York-based Larissa Lockshin to installations by Berlin duo Anetta Mona Chişa and Lucia Tkáčová.
Works shown at Cointemporary range from a painting by Lockshin for 4 BTC, to a Chişa and Tkáčová installation costing 16 BTC. Artwork that's sold is shipped by a Viennese fine art logistics company called Kunsttrans, which also accepts bitcoin.
Bitcoin's negligible impact
Not everyone shares Cointemporary's optimistic take on bitcoin and the art world. Jessica Silverman, who runs an eponymous gallery in San Francisco focused on emerging artists, believes bitcoin's impact on the art economy is negligible:
"We have never sold anything using [bitcoin or cryptocurrencies]. I would be open to it but at this moment, we do not see the need to move in this direction or how it would help our clients, artists or the gallery itself."
Silverman is already a relatively enthusiastic proponent of bitcoin, however. Her gallery's next exhibition, 'The History of Technology', will include an artwork that will be available for sale on Cointemporary.
Ruhry, who is a sculptor and currently a lecturer at the San Francisco Art Institute, learned about bitcoin while he was teaching at an art school in Austria in 2011. He concedes that it took him several years before he bought the cryptocurrency himself.
Cointemporary itself hasn't made any sales yet, he said, although he said he had received serious enquiries into some of Lockshin's work. Getting art collectors into the bitcoin economy will take time, he said.
"For us, Cointemporary is an art project, it's a statement, an experiment, and then it's a commercial platform. We don't expect to get rich with this, but we think it's important."
Featured image via Tom Loughlin