At the beginning of February, whispers on Discord quickly turned into a parabolic price chart for digital art project Hashmasks – an output of curiously named Zurich-based Suum Cuique Labs.
The headlines soon followed:
“Latest Ethereum Craze Hashmasks Sells 16,000 NFTs for $9 Million,” Decrypt wrote on Feb. 3.
“Rare Hashmasks Digital Artwork Sells for $650K in Ether,” one CoinDesk article followed up the next day.
Suum Cuique Labs’ first project is an attempt to bridge the gap among digital communities which have sprung up in the age of lockdowns and high-speed internet access. Its collection of abstract portraits is perhaps the best example of a $350 million industry quickly making its way to the mainstream through celebrity endorsements from people as lofty as Mark Cuban.
The project falls into a niche of blockchain-based applications called non-fungible tokens (NFTs). These tokens, which mostly reside on the Ethereum network, act similarly to an old stock certificate: You are given a token when you buy a Hashmasks. That token is a public claim of ownership to digital art that resides in private hands.
Yet, Hashmasks and other digital artwork suffers from one nagging quip: Can’t you just screenshot it?
Yes, you could. But this question misses how digital art came to be, in and of itself. New digital communities like Hashmasks want to relate, build and grow together. And that’s simply not possible in the online world of yesterday’s social media giants. Digital art extends online norms we’ve all become accustomed to by introducing digital ownership. To own a Hashmask is to be part of a new community.
Behind the mask
Hashmasks was the creation of a particular community, not a product designed for a community, said “John Doe,” the co-creator of the digital art project, who requested anonymity for this interview with CoinDesk. He and his co-founder, who also asked to remain hidden, are both digital natives, one being a Solidity engineer and the other a researcher at a digital asset manager.
How did they know what to build?
“We are the exact target audience. We just build what we would like. We didn’t have to do any analysis on people’s preferences because it’s just us,” Doe said. “We hang in the same Discords.”
Doe’s passion work – borderless exchange of value – reflects his upbringing. He explained how he was raised in Berlin, attended high school state-side in Arizona, received his Masters in Economics in London before finally settling in Zurich. While he became interested in cryptocurrencies before the 2017 bull run, he only got into the NFT market this past summer.
“I feel mostly German, I think,” he added.
What’s a Hashmask?
The duo spared no expense either. Each of the 16,000 plus pieces is unique, the result of 8 months preparation and collaboration with some 70 artists from around Europe, Doe said. The compositions leaned heavily on Jean-Michel Basquiat’s work in New York City during the 1980s, Doe added.
Each portrait has six features: a character, a mask, an eye color, a skin tone, an item and a background. Those features divide into further categories such as a lion or a dragon character, he said.
A few other features separate Hashmasks from other NFTs. First, the community designates rarity to each mask. Second, Hashmasks has a second token, the Name Changing Token (NCT). And third, there are hidden messages left in each Hashmask.
The original purchase of the 16,000 Hashmasks was completely random, even to Doe and his co-founder. Hashmasks could be purchased in tiers with each level costing a different amount of ether (ETH), Doe said. The rarity of a Hashmask then developed organically, Doe said, based on the portrait’s features. The highest grossing Hashmask, for instance, garnered $650,000 even though the original buyer only spent 0.5 ether worth some $750 at press time on the painting.
NCTs also act as a way for collectors to get involved with their work. Each Hashmask has an associated token that allows the artwork to have its name changed within certain limits. The naming tokens allow owners to build art on top of Hashmasks as a complement to the entire project, Doe said.
Lastly, hidden messages are embedded in many Hashmasks. For example, there’s a royal flush scattered across multiple pieces, Doe said. Puzzles and messages spread across Hashmasks creates community interaction and adds rarity, Doe said.
“We built the first collectable, in my view, where the rarity hierarchy is not solely determined by the creators,” Doe said. “This is not endemic to NFTs.”
Art goes digital
Digital art means different things to different people. For art critic Joshua Drake, NFT-based work most likely lends itself to what he called “posing”: collecting art as a method of reputation building.
“I have this work of digital art because it makes me seem a [certain] way in a digital community,” Drake said in a phone interview.
Posing holds value in the flesh-and-blood art world as well. For example, a politician’s collection subtly nudges viewers toward the owner’s authority in all things tasteful, he said.
As a technology, NFTs act as a seal of ownership on a particular creation, assembly of words or even collection of beats at a particular moment in time. That seal is valuable because a community says so, in much the same manner as bitcoin proponents argue the cryptocurrency itself has gained “moneyness.”
That’s not unlike traditional art, ConsenSys CMO Lex Sokolin said in a recent self-published newsletter:
“The ‘Mona Lisa’ is original and valuable. A poster of the Mona Lisa is not valuable, despite being nearly identical in visual information … Therefore, the art is valuable not for its collection of particular atoms in some particular order, but for its historical and social context. Recreating the object does nothing, because it does not contain the same social history.
“With digital NFTs, the same logic is true. Just because you have an identical JPEG to the one anchored to the blockchain, does not mean you have an original worth anything, nor does your ability to look at it suggest anything from a collectible point of view.”
Where to next?
But where does it go from here? Are Hashmasks caught up in the “everything bubble” many crypto-leaning economists worry about? Or are they the beginnings of a way of representing ownership in a digital world?
A proliferation of online art is not necessarily a disadvantage to the NFT marketplace, Drake said. Rather, NFTs may experience a similar timeline to that of bitcoin and other cryptocurrencies. Shoddy NFT projects will fall apart and winners will eventually appear, he said.
Doe said he expects the NFT market itself to keep growing. But early NFTs and well-thought-out projects like Hashmasks are the ones sure to gain and maintain value overtime, he said.
“In 10 years, no more entities will be emitted anymore and then it will start to solidify the artwork until one day it will all be gone and this artwork will take its final form,” he said.