Should Art Museums Collect NFTs?

Art is one of those rare things that, if you give it away, you end up having more. Ever since we invented art, there’s been a conflict between its supposedly universal meaning and resolutely private ownership. We resolve the conflict by donating art to a museum, where, for a modest fee, anyone can see it. But a shadow of the conflict remains. What do people actually see: the art or the price tag attached to it?

Back in April 2021, a Hyperallergic article announced, “MoMA Buys Amazon Rainforest to Offset Newly Donated NFT Collection.” It was obviously a joke, but barely. While art museums weren’t actually collecting NFTs yet, it was only a matter of time. Mike “Beeple” Winkelmann had just sold an NFT of his Everydays: The First 5000 Days (2021) at Christie’s for $69 million. If the art market says something is art, then art museums had better start collecting it. So, wen NFT museum?

The trouble is, art museums are in the business of collecting, preserving, and displaying art. But are NFTs really art? It’s hard to say.

Some clearly are. Artists like Rhea Myers, Mitchell Chan, and 0xDEAFBEEF use NFTs as a medium, creating work that can only exist as NFTs. But most NFTs consist of a URL. In other words, they represent ownership of a work of art. Should art museums collect those NFTs, or just the artworks they represent? And for those art museums that have already started collecting NFTs, what should they do with them?

In the case of NFT art, i.e. those works for which the token is the medium, the answer is easy — museums should simply add those works to their collections. Though collecting NFTs will present technical challenges, they are solvable. After all, museums collect digital art and have learned how to solve the problems associated with preserving and displaying it. NFTs are nothing but digital art on the blockchain, so museums will figure it out.

But what about NFTs that only represent ownership? In July 2021, Eduardo Burillo donated the NFT representing Larva Labs’s CryptoPunk #5293 (2017) to the Institute of Contemporary Art, Miami. But it was stuck in escrow for months, while appraisers tried to determine its value for insurance and tax purposes. Should the museum have accepted the gift in the first place? And now that the gift is finalized, what should the museum do with the NFT? There’s no question that CryptoPunks is an iconic NFT project — it was the first NFT collection to go viral and its NFTs now sell for millions of dollars each. What’s more, their imagery epitomizes the blockchain aesthetic.

If Andy Warhol had grown up in the 1980s, he might have used pixels rather than silkscreens.

The question is whether the museum needs to own an NFT in order to collect the work it represents. There are 10,000 CryptoPunks NFTs, each associated with a unique image. Many different people own those NFTs. But if copyright protects the CryptoPunks images, does the museum need to own an NFT or can it just get a license from Yuga Labs — who now own the copyright — to reproduce and display CryptoPunks images?

‍NFT maxis insist “the token is the art.” If they’re right, then museums should collect NFTs in order to own the works those NFTs represent. It’s intuitive. As Walter Benjamin famously observed, art depends on its aura of authenticity.

Art museums collect authentic things. NFTs represent authentic ownership of digital things. So, art museums should collect digital art by collecting NFTs.

But what if the art is the experience, and the NFT only represents ownership of the art? Or rather, what if the token isn’t the art but a way of making it possible to sell the art? Don’t get me wrong, that’s a big deal. No one but a blockhead ever wrote except for money, and the same goes for art. Sure, there are plenty of blockheads, but artists still gotta get paid, and the art market is where the money’s at. NFTs created a market for digital art, and that’s transformational. But if the token isn’t the art, do museums need to own NFTs in order to collect the art they represent? Maybe not.

NFTs enable artists and collectors to sell digital art by making it artificially scarce. But museums don’t need to sell art. In fact, they’re not supposed to sell art, and people are horrified when they do. Of course, art museums don’t really own art in the conventional sense. They hold it in trust on behalf of the public. This means that, when museums acquire art, they’re supposed to keep it forever. Legally, the museum owns the art, but it really belongs to the public, with the museum acting as a custodian for future generations. More specifically, museums have adopted professional rules limiting their ability to sell art, and punish each other for breaking those rules. How do those rules work?

Museums accession an item by adding it to their collection, and deaccession an item by removing it. They are only supposed to accession things that fit their collection, and deaccession things that don’t. The Association of Art Museum Directors (AAMD) has created deaccessioning rules, which say that art museums can sell works from their collections only in order to buy different works. They cannot use the money from sales for any other purpose, including to save the museum from bankruptcy. Supporters say the AAMD rules prevent art museums from monetizing their collections. Cynics observe that they also make art more scarce by reducing their supply, increasing the value of works still in private hands. What a coincidence.

The result is that the AAMD deaccessioning rules exist in a curious tension with the trust of the public. If museums do hold art in trust, how can they sell it for any purpose? Opponents of deaccessioning have objected to the Baltimore Museum of Art selling works by white men in order to buy works by artists of color, arguing it made diversifying the collection too easy. What they mean is: diversification at all deliberate speed.

Certainly, if art museums aren’t supposed to sell anything in their collections, they don’t need most NFTs, which exist only to enable the sale of digital art. On the other hand, if the NFT is the art, presumably museums can’t sell NFTs either.

Maybe museums should bind their hands by sending all of their NFTs to a burn address that they own but can’t use, essentially creating a permanent collection. It wouldn’t harm the artwork or the NFT, both of which would still exist and belong to the museum.

Alternatively, museums could choose to regard the donation of NFTs as financial contributions akin to gifts of securities, which NFTs certainly resemble. That way, museums could keep or sell the gifted NFTs and use the proceeds according to their discretion. That might foster a whole new era of financial solvency for museums, just as it has for digital artists. Museums might then choose to route NFT donations through their development office, rather than the curatorial staff, much like they would with donations of other kinds of securities.

Museums have actually encountered this problem already, they just didn’t realize it. Conceptual art is often sold in the form of a certificate conveying the exclusive right to realize the work, and museums collect those certificates. But many conceptual artworks are uncopyrightable, so the certificate owner doesn’t own an exclusive right to do anything. In such instances, the certificate isn’t the art, it just represents ownership of the work. In other words, it’s an NFT in paper form.

Museums preserve conceptual art certificates like any other artwork in their collections, pretending they need a certificate in order to display the work it represents. But you don’t need permission to display an uncopyrightable work. NFTs remind us that certificates of ownership are often a convenient fiction.

Without certificates what would artists sell? What would collectors buy? And what would museums curate?

NFTs are already encouraging people to think differently. To take one example, NFT “curation” platforms like JPG allow people to create a collection of NFTs from any source, no matter who owns them. Artists can create a virtual gallery of their own work, while collectors can showcase the NFTs they own, and critics can display the works they want to discuss. If you want to create a collection of CryptoPunks, no problem. It’s easy and free to use NFTs as a way to express your experience of the work you find compelling.

I think JPG has the right idea. You don’t need to own an NFT to admire the work of art it represents, and a museum doesn’t need to own an NFT to share it with you. Of course, owning an NFT of a work can and does affect your relationship to the work it represents, in the same way that owning a painting or sculpture changes your relationship to it. But museums can and should be more than warehouses full of valuable property. NFTs can help to remind them by forcing them to rediscover their purpose. Maybe NFTs can finally liberate art from the art market.

As Marshall McLuhan once observed, “[t]he message of the electric light is like the message of electric power in industry, totally radical, pervasive, and decentralized.”¹ I think the message of NFTs is much the same. And we’ve only just begun to understand it.