We have all noticed the rapid growth of the digital art ecosystem from bear to bull market, but it’s indeed necessary to highlight the adoption by traditional artists and physical art institutions of blockchain technology. The sector continues to grow.

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According to the Fuelarts Art+Tech Startups Report 2024, there was an influx of 452 new investors in the Art+Tech market in 2023, making up a significant 62% of the total investor count. This influx is nearly triple the rate of new investor entries in 2022.

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Denis Belkevich, the main analyst behind the report, highlights why such growth occurred:

“Last year, we observed two contrasting trends in the Art+Tech sector: a decline in investment volume but a rise in the number of new investors participating in funding rounds. Primarily, these newcomers are from investment funds that traditionally focused on hard assets — such as securities, precious metals, and real estate. Their shift toward high-risk investments in startups, particularly within the art sector, indicates that the ecosystem has matured significantly, driven by a wealth of data, specialized reports, and increased marketing efforts. This influx suggests that investors are keenly aware of the potential opportunities in the Art+Tech field, driven by a strong desire to capitalize on emerging trends and avoid missing out.”

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This spring, we also saw the rise of Bitcoin Ordinals, the artwork inscriptions on satoshis, the smallest unit of Bitcoin. Harto, artist and curator of Vivid Gallery who has been creating Ordinals art since its beginning, commented on the 'importance of something for this ecosystem to grow. “We need more eyes, creating a bridge with traditional art through education. If we can show why blockchain can help both artists and collectors, everyone wins.”

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Traditional art is also embracing Ordinals, as LiveArt is launching Yue Minjun’s debut Ordinals Collection. Yue Minjun is a traditional contemporary artist, Venice Biennale Participant, and person of the year as per Time Magazine. This once again signifies the rapid growth and interest of renowned figures in the art world in digital art.

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Boris Pevzner, CEO & Co-Founder of LiveArt, commented on the empowerment traditional artists will get from entering this ecosystem.

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“The world's biggest artists like Yue Minjun expect their art to outlive them, to be preserved and be relevant for hundreds of years. They have a long-term perspective. Their works are housed in the most important museums and institutions around the world.

‍Bitcoin blockchain and Ordinals are the best match for this worldview. Bitcoin blockchain has the credibility and permanence unmatched in the crypto universe. Ordinals artworks are always on-chain, immutable and permanent. This is why global artists like Yue Minjun are gravitating toward Ordinals and the Bitcoin blockchain.”

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The intersection of Art and Technology in the NFT sector continues to thrive too. For instance, CryptoPunks announced their art residency with Nina Chanel Abney. One of the oldest NFT collections, adapting the practices of the traditional art world, is a sign of the right path we are moving towards.

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Natalie Stone, General Manager at CryptoPunks commented, “The idea of artist in residence is not new, it's a popular practice in traditional art work.  What makes it so exciting for the CryptoPunks team is that we get to create this safe container for experimentation. Unrestrained by medium or genre, Punk in Residence then becomes an opportunity - where the blurring and collapsing of traditional definitions of art and boundaries between artist and audience - is encouraged. When artists have the freedom to leverage next-generation technology - we can then bring original works into existence that wouldn't be possible without technical support and expertise. For example in Nina's case, her embrace of the 3D medium and the metaverse pushes the viewing experience of her art in a totally new way.” 

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To add to that, Arcual, the company backed by Art Basel, is building the digital infrastructure for the art world, making changes such as creating an online catalog for some of the art fairs, making it more accessible for collectors who aren’t present to purchase the artworks themselves.

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Bernadine Bröcker Wieder, CEO at Arcual, commented, “At Arcual, we believe in that genuine and permanent connection with a work of art.

‍Our tech enables this with a seamless and transparent purchasing experience. For example, at Future Fair in May 2024, Digital Companion powered by Arcual helped visitors to the fair view the prices of the works on display and pay, receiving a Digital Dossier with immutable documentation about their purchase.

‍For Access by Art Basel, Arcual powered the payment split for collectors donating to selected charities with their artwork purchase. Collectors purchasing works from this curated sale raised over $100,000 for the Miami Foundation and the International Red Cross while also ensuring the artist and gallery were paid.

‍It's not necessarily about replacing the in-person experience - Arcual's digital tools enhance the connections that happen both physically or online.”

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As we also notice the blue-chip NFT collections finally raising the floor price:

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- CryptoPunks to 37.9 ETH

- Bored Ape Yacht Club raising to 16.4 ETH

- Pudgy Penguins making a fuss with their toys during NFT Paris rose to 12.1 ETH

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The outlook for the future looks bright, building on a promising first half of 2024.