Recent years have seen some of the biggest art forgeries of the 20th century, including a $79.6 million Austrian case of forged certificates and replicas by Pablo Picasso and Claude Monet.
According to the FBI’s art crime unit, art frauds, forgeries and fakes total $6 billion annually.
In an industry plagued by authenticity and traceability issues, could Blockchain technology be the solution to bringing transparency to the art market?
Essentially a cloud-based digital ledger, Blockchain offers a secure means of digitizing authentication, provenance and ownership history.
Artists would register their work into the Blockchain to create a digital certificate of authenticity. Through a unique cryptographic ID, each artwork can be authenticated and ownership rights securely transferred to galleries or collectors. Once a transaction is verified, the Blockchain ledger is updated and cannot be removed or altered.
This “distributed registry of authenticity” offers a significant upgrade from the current system and incredible potential to easily prove authenticity, ownership and transactions.
Blockchain can help to make fine art accessible for everyone. Traditionally, artists have relied on galleries for distribution. Blockchain could eliminate such intermediaries and connect artists directly to a broader audience through an online market.
Proving Provenance and Authenticity
Standard paper-based transaction records are unsecured and prone to inaccuracies, omissions and forgery.
When combined with technology like in-depth scanning and fingerprinting, Blockchain offers a secure, digital solution to verifying provenance (where a work comes from), authenticity and ownership.
Once the provenance and authenticity is recorded in the Blockchain, it won’t require authentication again, which takes a lot of cost out of the system.
Establishing Identity and Ownership
Anonymity has long been central to the art world. The identity of art owners is oftentimes concealed, especially during auctions. But this creates opacity around tracking ownership- a key element in establishing a work’s authenticity.
Blockchain could provide visibility into the secondary market by recording transactions and changes in ownership as well as transparency around the identity of the owner.
While proponents of the Blockchain believe it has the potential to revolutionize the art market, the technology has been slow to gain traction. As with anything, change is often slow. It will likely take a progressive gallery or a prominent artist to adopt it before it becomes the industry standard.