Warnings about NFTs can't keep pace with the buzz to join in. What should museums do?
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It's interesting that at the same time we have articles warning about NFTs we have this growing NFT and crypto industry, perhaps driven by the equally dire economic prospects for investors and creators alike. Orgs, especially in the start-up and consulting space, have also been checking out Decentralized Autonomous Organizations (DAOs), which I first wrote about earlier this year. (Short version for museum workers: DAOs might provide a route to a new kind of museum model if a lot of things fell into place, with the crypto handling communication and work agreements.)
The wall around NFTs and DAOs is crypto, which creates a certain barrier-to-entry, a liminal divider between understanding and head-shaking confusion (which doesn't keep some people from entering anyway, figuring they have no choice/nothing to lose). I'd counsel people not to try to get into crypto all by themselves but to find others—especially if they're aligned with your interests and also fairly new—to take the journey with. The museum field could use some collective learning about crypto, NFTs (watch what artists, not investors, are up to), and DAOs. I'm taking a podcast crash course on the latter with org design firm Brave New York's podcast DAO mini-series (most of episodes 105–115).
So here's the latest.
One: Let's start with the idea of the decentralized web, or "web3." Here's a warning in Medium, here's a claim that decentralization is really more centralization, here's a proponent in Medium, and here's a reminder from trailblazing author Cory Doctorow that crypto and blockchain require trusted third parties off the chain to authenticate the data going in. And, finally, here's an in-depth Medium explanation of all that the chain can't do yet in terms of making the decentralized web work:
Some people have suggested that NFTs could be used for recording things like deeds and property titles, but it makes little sense to use blockchains for recording anything physical or anything that requires off-chain validation, authorisation, authentication or confirmation … . Blockchains only make sense in a digital-only world, and only for transactional data — and so far nobody came up with a compelling dapp idea (decentralized application) that is not tied to cryptocurrency in any way. …
… the problem isn’t a technological one: it’s a political one. If we truly want to confront the power held by the big social media companies, we need to go in the opposite direction to what the Web3 cult is trying to take: look at the profit motive within the industry, look at adequate regulation. I’d go as far as saying that the only way to solve the problem with large social media companies is to remove business and profit from the whole equation.
A radical standpoint would be to further democratize our monetary system and to look at getting rid of money entirely in the far future. Bitcoin isn’t radical — it’s a step backwards, towards marketization, not democratization, giving more power to owners of capital. I always find it hilarious when people sugest that cryptocurrencies are confronting any power — big banks already invest hundreds of millions of dollars and profit from cryptocurrencies. Crypto might make them feel at most uncomfortable, but not threatened.
And here's a response to Doctorow's piece above.
Two: Now on to decentralized autonomous organizations (DAOs). I've mentioned The Ready's Sam Spurlin and his writing and research on DAOs. Here's more from Sam on the popular org design concept of an organizational operating system. If you're thinking of any org, new or existing, as a DAO, it's a good idea to first map out how the organization works (what he calls its "operating system"), how value and information (the point of a market, after all) flows around it. Spurlin writes:
A process like this requires two things that traditional organizations often struggle with: quick iteration and freedom to try new things. Almost nothing happens quickly or easily in traditional organizations, including operating system experiments. DAOs, on the other hand, may actually suffer from the opposite problem – too much hectic iteration without codifying lessons learned and too many degrees of freedom, inadvertently pitting experiments against each other in a way that confounds the results of both.
[The Ready has] collected these practices, principles, and assumptions and tried to better understand what unites them. We’ve landed on two major categories that most of these progressive practices and approaches can be sorted: People Positivity and Complexity Consciousness.
I know museum folks are cynical about catchphrases, but read on:
People Positive operating systems are built on the fundamental assumption that people are good, trustworthy, and willing to work hard without someone standing over them with positional authority to reward or punish them. These operating systems build structures and scaffolding that honor the humanity of the people who work within them. They push the envelope on what it means to trust people and they deeply question any policy or process that assumes people need to be monitored, coerced, or otherwise forced into specific behaviors. They expect a lot from people because they know people have a lot to give. People Positive DAOs understand that people will behave in the ways that the system expects them to behave: Trusted people act trustworthy, coerced people will be passive unless forced into action, people treated like pawns will treat the organization like a game to be won.
Complexity Conscious practices, principles, and assumptions are about honoring the reality that organizations are complex systems. Complex systems cannot be analyzed and repaired like complicated systems. Organizations are like weather systems or gardens, not broken watches or malfunctioning engines. Complexity Conscious operating systems allow for emergent and unexpected behavior by creating simple rules and guardrails that constrain behavior in useful, yet minimal, ways. They don’t try to overly predict and plan their way into a completely knowable state because they understand complex systems can never be managed like that. They try to create conditions, expertise, and pathways for more robust sensing, steering, and learning along the way. While humans tend to enjoy feelings of certainty, Complexity Conscious organizations understand that certainty is nearly always an illusion and that the only way to truly understand a complex system is to stay in constant, active, relationship with it.
It's interesting how few of the above descriptions capture what it's like to work in a museum right now. Can we change it—or at least map it out before turning to something in crypto?
Three: Here are two DAO advocacy pieces; first, from tech investment behemoth Andreesen Horowitz, and then a piece from last year that I've mentioned before, a useful DAO primer from onboarders (because launching a DAO does take work and guidance—some organizational, some technical) Coopahtroopa. If you're a museum person at all interested in what I've mentioned about DAOs, check out this link to get an idea of what's out there to know. Keep asking the tough question: what does this do that a museum org can't already do?
Four: Here are two useful Medium articles about the idea of ownership, from Joan Westenberg and Christian Cantrell. The latter asks whether we can separate the promise of a new form of digital ownership from its deeply flawed implementation:
In my mind, NFTs are a form of digital ownership that works with the nature of digital goods instead of clumsily fighting against it. Specifically, NFTs presume innocence around consumption — that you are permitted to appreciate digital content unless or until proven otherwise.
NFTs propose that some types of digital goods don’t need to be scarce as long as their ownership is verifiable. Specifically, if I can verify that I am the owner of a piece of digital art, I may not mind that there are hundreds, thousands, or even millions of copies of it, and that others are free to enjoy, share, and even remix it. In fact, the more others experience the digital goods I own, the more value there may be in owning them. Being able to easily prove that I own something might obviate the need for it to be scarce.
This comes across to me as an interesting hybrid of the library model (lots of copies, as widely distributed as possible) and the (pre-open-access) museum model (one copy, closely-held).
Five: Regarding NFTs as investments, there are useful articles here and here, with other pieces on the idiocy of NFTs and the people who write about them. The investing issue is an important one because the combination of wealth and scarcity in the museum field makes all of us prey to moneymaking schemes—and the constant pivot to digital doesn't help.
Six: NFTs actually can offer artists a greater route to creating a community, writes Michelle Drouin:
And this community-building potential reaches every person who owns an NFT. In online spaces, mostly in Discord and Twitter, thousands of people join the town halls and chats of the projects in which they have bought in, creating tight-knit communities around specific projects … [some of them] more reasonably-priced, but still expensive … . And those spaces host incredible conversations and opportunities to have socially intimate moments with people who are normally beyond our reach. … The NFT world isn’t just a space for showcasing expensive digital art — real, intimate connections are built in these spaces.
So NFTs have potential as both the art (or a tokenized representation thereof) and the gallery experience combined into one digital package. Anyone who participates in online communities around a content creator (like reactor or game-streaming videos) understands that there are real possibilities here for creators as well as followers.
Seven: But, here's an author worried about NFTs of her IP.
Eight: This article usefully asks, "Can You Be an NFT Artist and an Environmentalist?"
Nine: This Harvard Business Review piece could be advising museums about how NFTs can help their brand:
… NFT-encoded digital identifiers can chronicle a whole host of real-world purchase and consumption experiences, infusing them into our digital lives in ways that are authentic and portable across communities, and creating exciting new possibilities for brands and their consumers. Designed right, NFTs could build on the expansion of conspicuous consumption seeded by social media, allowing us to showcase our non-digital lives in our digital spaces more expansively and more authentically. … Future virtual spaces could feature your NFTs of each of these purchases or experiences, providing presentation options tailored to your preferred level of subtlety or ostentation that transcend today’s narrow alternatives of Facebook check-ins and Reddit profile badges.
I'll pretend it doesn't sound creepy. The article continues:
These blockchain-based tokens of authenticity could also revolutionize secondary markets for physical items. Thus far, original manufacturers have rarely captured value when their items are resold, and in these rare cases of value capture (like certified-pre-owned vehicles), the items must be expensive enough to justify the overhead of certification and sales. An NFT-based digital seal of authenticity for a physical item creates more seamless trust in peer-to-peer resale and can empower a brand to share in the associated value capture more easily … . In fact, since NFTs are not just static digital records of authenticity, but are programmable, brands might even implement an NFT royalty standard that encodes a small fraction of value capture associated with every resale.
We get back to the idea of combining the scarcity of art objects with the sharing of distribution. It's got potential, but museums really need to open up participating in launching these kinds of products to their entire organizations, not just Digital, Finance, Legal, and Merch. How could front-of-house workers be involved? Publications? Membership? Design? Education? The phrase I've used more and more of late is "for the rest of us," and NFTs are no different.
Ten: This article says that NFTs should be thought of as a sales mechanism, not a medium in their own right:
NFTs fulfil an authenticating function for a small fraction of digital art—digital images that “live” and circulate on the network. This ironically led to the now-common practice of artists and gallerists minting NFTs for stills or brief clips from more complex, often generative and interactive digital artworks that are available for lower prices than the excerpted images being offered as NFTs. Whether digital images benefit from the immutability provided by NFT authentication is yet another question. In his essay “The Work of Art in the Age of Digital Reproduction (An Evolving Thesis 1991-95)”, Douglas Davis makes a case for the originality of the moment when we copy and revise digital images whose power often resides in the possibility of remix and free circulation. …
The NFT gold rush has been investment-driven, with the art world following the economy rather than the other way around. To avoid the blockchain becoming digital art’s metaphorical ball and chain, the art world must acknowledge the art form’s rich history and its potential for creatively exploring the crypto space and decentralised distribution.
Bonus: I'll end with Elizabeth Merritt of the American Alliance of Museum's Center for the Future of Museums. Merritt dives deep into the potential (and pitfalls) of NFTs for museums:
Bottom line, the NFT market is currently a wild-west landscape of minimal regulation and oversight, and buyers looking to “invest” in NFTs should be on their guard. …
So, while blockchain generally, and cryptocurrency specifically, does afford some opportunities for people previously excluded from or disadvantaged by traditional gatekeepers, like banks, or art dealers, it affords even more opportunities for people who are already economically and technologically privileged, and well-situated to exploit the disruptions created by new mediums of exchange. …
At the end of the day, in crypto, as with any area of practice (tourism, fashion, construction), we can ask how to make it less destructive through better design, or carbon offsets, or tweaking the chain of production. But in the end, we need to consider whether the best way to limit impact is to simply do less: less travel, fewer new purchases, more adaptive reuse of existing things, whether that’s clothing or buildings. In the case of crypto, we may need to ask whether the costs simply outweigh the benefits. What can the blockchain do, uniquely, that can’t be done as well and more sustainably by traditional systems? Is cryptocurrency more accessible, equitable, and efficient than traditional fiat currency, especially if those traditional dollars can be moved around via simple digital platforms like Venmo or Paypal? …
Is the nature and impact of crypto (NFTs and cryptocurrencies) consonant with your organization’s mission and values? … Be aware that whatever decision you make will be examined by the public. Even people with only the haziest understanding of NFTs may be aware that they are “not green." …
Are you primarily interested in NFTs because they are new and exciting, or is the format a natural fit for a particular project or theme in your collections and research? For example, the Whitworth museum at the University of Manchester issued an NFT based on William Blake’s Ancient of Days as a way to test alternative models of financing social practice. … (The museum also chose to issue the NFT on a proof-of-stake network to minimize the associated energy consumption.)
… it’s worth asking how, beyond seeming cool, that makes the opportunity to support the museum more equitable or accessible to the community it serves.
As usual, Merritt lays out the key decisions from a complex discussion.
As an org-culture geek, I'm personally more interested in DAOs than NFTs, but as so much of the DAO conversation ends up with NFTs and other monetization angles (especially for museums and artists), it's hard to disentangle the two. I'll make an effort in the next month or two to focus just on DAOs in the museum sector.
I hope you enjoyed the links!
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cover photo by Yohann Lc / Unsplash [description: a hand holding a metallic line with small glowing disks, against a sea at sunset]
Links of the Week: March 18, 2022: Stay NiFTy by Robert J Weisberg is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
