|Rachel O' Dwyer on Sun, 14 Mar 2021 19:57:11 +0100 (CET)|
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|Re: <nettime> what does monetary value indicate?|
On 14.03.21 14:25, Rachel O' Dwyer wrote:
> The article includes a discussion of economic *'signalling' *that was
> prompted by conversations with Ruth Catlow which chimes with Felix's
> questions about what the digital art purchase 'says'.
Doma alerted me to this analysis, and if it's correct, then this is
basically a "pump-and-dump" scheme.
I suspect there is more to it, more layers of scamminess, but so far the
story goes like this:
The buyer, MetaKovan, and the seller, Metapurse, are entities
controlled by the same person, Vignesh Sundaresan.
Metapurse is a fund which owns digital art works. It's mission is to
"democratize access and ownership to artwork." Quite a statement to make
in relation to digital art, but the entire story is full of scammy
You can buy into this fund, called B20, then you own a tiny portion of
its art works. You do this by buying special B.20 tokens. The value of
these tokens reflects some speculative position on the underlying value
of the art works held by the funds or profits to be made from selling
There are 10 million tokens minted. 56% of these are owned by
Metapurse/MetaKovan who thus controls the entire process in terms of
writing to the blockchain. 2% are owned by Beeple himself (oh!). In
December, Metapurse bought Beeple's art work for 2.2 million. On January
23, Metapurse sold 1.6 million tokens at $0.36 a pop.
After the sale, which greatly inflated the value of the "assets" held by
the fund, the value of the tokens rose to 23.00 and then fell back to
16.00. Given that buyer and seller are controlled by the same person,
the actual costs for the purchase are only the feeds to be paid to
Christie's, some 9 million.
You can do he math yourself, but the profit margins are staggering, if
Sundaresan manages to to get cash out his own tokens while it lasts.
What I find remarkable is the role of Christie's in generating the
narrative. Auction houses seem to have specialized in this lately,
perhaps they always have. But, remember Sotheby's sold a Banksy work
that shredded itself (Oct 2018). Well, almost shredded. The story went
around the world, greatly enhancing the value of the work. It's hard to
phantom that Sotheby's did not examine the art work before hence
realized that there was something hidden in the frame. Or, when
Christie's auctioned off the "Portrait of Edmond de Belamy" in December
2018. The value is really generated by the story, told by a blue-chip
The fact that all of this is so scammy doesn't seem to matter, because
it's the money that makes it real, the sheer scale is self-validating,
even if the money itself is barely real to begin with.
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