Non-Fungible Tokens (NFTs) — Could it Help The Emerging Filmmaker?7 min read
Reading Time: 6 minutesHot off the heels of the cryptocurrency hype surrounding Gamestop, another buzzword has swept the Internet: Non-fungible tokens, or NFTs. Digital artworks, photographs, video clips, tweets and memes have been auctioned off for thousands — upwards of millions — of dollars. Even Christie’s, the art world’s premier auction house, have embraced NFTs, recently launching its first sale of digital-only art.
The cryptocurrency token represents a brave new world for creatives, with budding artists and photographers arguably having the most to gain. For practitioners of other art forms, however, it gets a little more complicated to operationalise NFTs.
What Are NFTs?
NFTs are a form of cryptocurrency. A lot of the hype surrounding cryptocurrency has been of its relative scarcity (varying from the type of cryptocurrency) which partially circumvents the issues of runaway inflation that comes with traditional currencies. Another advantage of cryptocurrency is its use of blockchain technology as a publicly accessible and unalterable ledger of all transactions with the currency.
NFTs stand out from traditional cryptocurrencies because of their fungibility — or the lack thereof. One example of a fungible item is money, where Singapore dollars could be swapped with US dollars. There is no value attributed to the specific serial numbers of each dollar bill. Non-fungible items are the opposite, where they are valuable exactly because of their serial numbers.
Non-fungibility is the prime currency of the art world. There are millions of photos of the Mona Lisa but they would never be as valuable as the original. NFTs transports that idea into cyberspace where just about anything can be minted, authenticated and tokenised with blockchain ledgers to back up the item as ‘authentic’.
Why Are NFTs Making a Splash?
While they have been around for a few years now, NFTs are now more easily purchasable on sites such as OpenSea and SuperRare. As these mainly accept cryptocurrency, how the technology has been demystified and accepted into the mainstream also accelerated the acceptance of the trend.
The appeal behind NFTs has always existed in analogue form as collectables and status markers. The art world thrives on originals. The same idea is extended to collector culture, where original prints of vinyl records, trading cards, and film posters or props are highly sought after. Whether digital collectibles can hold the same weight to collectors as physical collectibles is perhaps what makes the NFT trend both exciting and volatile.
Beyond their form, how NFTs differ are how they are able to cut out the middlemen (mainly distributors) in between the audience and creators. Perhaps the clearest beneficiaries of NFTs are emerging artists. An artist’s first painting may be initially sold for a measly amount but the value might skyrocket once the artist makes it big. The key problem faced by these artists is that they do not benefit from any subsequent royalties.
NFTs changes this by ensuring that the ‘authenticity’ of their artwork will always remain with the artist, rather than auction houses and distributors. Blockchain technology lowers the risk of piracy and fraud while enabling artists to continuously benefit financially from ownership of their works.
This system, however, does not benefit musicians or filmmakers the same way.
How the Music World Has Embraced NFTs
By their very nature, music and films are meant for mass consumption. The same principle that applies in the art world cannot directly be applied to these mediums. An NFT-authenticated song or film will probably not mean as much as pirated copies (yet). It’s not helped that, unlike paintings, songs or film clips cannot be physically hung up around houses and offices as status markers.
Yet, the music world has embraced the new craze. Pop-rock group Kings of Leon recently announced that their latest album will be released as an NFT — one of the first of its kind. Available for sale for only two weeks, the NFT will include the album, a vinyl and digital copy, digital artwork, and six “golden tickets” that fans can redeem for front row seats to one of their concerts. To date, the band has reportedly raked in US$1.4 million in an auction.
Former bedroom pop artiste Grimes also recently made bank selling her digital artworks as NFTs. The Wu-Tang Clan are releasing an NFT coffee table style book featuring never-before-seen photos of the group. NFTs may not be a way for musicians to circumvent their record labels — Warner Music Group got into the game as far back as 2019 — but it does present a new avenue for marketing and revenue.
The Disadvantages of NFTs
It seems that every day there is a new headline further fuelling the hype surrounding NFTs. However, there are still several burning questions that have to be resolved.
Most of the big winners in the NFT space have mainly been of established names and artists. Not only do marketplaces charge ‘gas fees’ for minting a digital item, but new artists would also have to compete for attention with curated or far bigger names. As with any item of manufactured scarcity, NFTs also lives and dies by its hype. Creators have to keep their audiences invested, and they, in turn, have to be willing to adapt to the new technology.
As touched upon earlier, perhaps the most apparent disadvantage of NFTs is with how there is no tangible way to show them off since they all exist in the digital space. However, this might be solved in the very near future. Tech companies such as Terra Virtua are creating immersive collectable platforms on PC, Mobile, AR and VR to showcase purchased NFTs.
NFTs and the Film Industry
Not a lot of attention has been given to how NFTs could affect filmmakers and film lovers but the potential opportunities and issues are similar to those of the music world.
One of the first-movers of NFTs in the film space is William Shatner, whose NFT trading cards featuring photos from his personal life and storied career sold out in nine minutes in 2020. The family of Star Trek alumnus Leonard Nimoy has followed suit, with a portion of proceeds going toward COPD research.
Similar to musicians, virtual film props, assets and collectables could also see a future as NFT amongst passionate fans. Unfortunately, NFTs as a form of film distribution to circumvent the current outdated model might not be possible.
Just about anything can be tokenised, including real estate and contracts. The idea of the film rights being sold as NFTs can be exciting. But given the recent emergence of the technology, this may be tangled up with existing intellectual property laws. Film rights as NFTs would also seem far too counterintuitive, given the focus of the cryptocurrency is to benefit and protect the ownership of the film’s creator.
Interestingly enough, however, the rights of film ‘Body High’ is now available for purchase as an NFT on OpenSea.
The answers to whether NFTs will be able to uplift emerging filmmakers, and if the technology will have a similar impact to crowdfunding, are currently up in the air and open to creative answers. The barriers to success may be too high, given that they would have to compete with bigger names to even gain attention. Additionally, most independent films hardly accrue profits either.
Theoretically, NFTs could be an additional avenue of promotional and funding support, where behind-the-scenes photos, scripts or virtual props to be used can be sold as collectables. If the film or filmmaker makes it big, they could still benefit from the sale of the virtual props in their student films, where they can get a cut whenever the item trades hands. But given that films are collective efforts, there are bound to be legal entanglements regarding who exactly owns the now-collectable item.
Still, it’s key to remember that these are still the early days of the technology. NFTs may turn out to be this generation’s Beanie Babies, or it may revolutionise the relationship between the artist and their audience. A lot of experimentation would be required to fully operationalise the idea behind the technology. And it will undoubtedly be exciting to see where it will all lead to.
Banner Image Credit: Larva Labs
