New Markets In The Arts #1: Property Rights

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Blockchain technology has allowed us to re-imagine the arts. As a movement, it’s been rife with seemingly disparate narratives: people adopting its cocktail of hashes & cryptography as a Rorschach test for their beliefs. It’s simultaneously the most anarchist, most libertarian, most egalitarian, most socialist, most freeing, most authoritarian technology. I’ve always seen it as a tool to empower creatives. That’s why I got into Bitcoin development in 2013: to help my 14-yr self in 2004 get paid. As a teenager, growing up in South Africa, my games couldn’t be sold online without jumping - like a videogame character - through many hoops.

There’s a lot that has been done to empower creatives. There’s a lot more to explore, especially in exploring new markets in the arts.

In a series of posts, I will explore three broad avenues that currently interest me:

- Experimenting with Property Rights.

Generative Art Economies.

Markets *as* Medium.

This is article #1.

Experimenting With Property Rights

A core feature of some intellectual property (eg copyrights and patents) is the societal notion that it eventually finding its way into the public domain is a ‘Good Thing’. After a period in time, where-upon the creators can privately exploit it, it arrives for full use without restrictions. Despite lobbying and increases in copyright extensions over the past few decades (last one in the US being the Sonny Bono or “Mickey Mouse” act in 1998), there is still an eventual limit. At *some* point, it becomes public.

To determine where this line is, is arbitrary. Why is 50 - 100 years after death chosen? And who is to say that this is the net benefit? Are there perhaps other ways to determine when IP is available to exploited in private or in public? Perhaps… *drum-roll* a market?

Amongst a set of proposals in ‘Radical Markets’ (mechanism designs to inspire social change), is the adoption of Common Ownership Self-Assessed Tax (COST) on certain assets in society. It is more commonly known as Harberger tax, after the economist, Arnold Harberger, that initially proposed it.

In short: For a specific asset, the owner ALWAYS have to specify a sale price. It can be bought at any time. They can’t specify an exclusionary price such as $5 billion, because the owners have to pay a percentage tax on it.

What’s interesting about this model is that it results in more allocative efficiency: people that want it, can more readily own it. It is not however with its trade-offs, and thus, the underwritten goal of this property regime is to satisfy the maxim: “…ought to be owned in the commons.” Not every asset should be handled in this manner.

It is with that notion that we could imagine some intellectual property be governed with these property rights. Both Matthew Prewitt and Luke Duncan have explored these ideas in terms of intellectual property and the open source licensing movement.

What you want is:

- Free when open.

- Funding open source when privatised.

Essentially: instead of having arbitrary limits to having intellectual property reach the public domain, a market process would govern it. It could be privately exploited if the owner sets a price on the rights, alongside a yearly tax/fee that goes back into the commons.

Choosing where this revenue/tax goes is part of what makes this an interesting idea to experiment with in the arts. If the tax goes towards the artist, they would earn revenue from the mere valuation of the work, per second.

This is in contrast to existing projects out there that support secondary sales still funding the artist with each sale (like SuperRare). Instead of liquidity events happening per sale, the artist earns perpetually.

It is with that idea that I created the art project: “This Artwork Is Always On Sale” (2019). It is a digital art piece that is ownable on the Ethereum blockchain, whereupon the owner always have to specify a sale price. 5% pa of this price goes towards me. Every few seconds, I earn a few dollars. It is currently valued at roughly $45,000. Over the course of 8 months since it has been live, I’ve earned 11 ETH ($2100 at current rates).

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This model can be extended beyond just art. It could be used to create a whole new asset class when the collectibles represent forms of patronage. A team from Cape Town has been exploring this in the context of conservationWhat these tax rates should be for these collectibles is still an open-ended research question.

When you combine collectibles with funding into one, you create ‘Patronage As An Asset Class’.

Commons Art

The more interesting exploration is when ‘Harberger Tax’ revenue goes towards a commons (“…ought to be owned in the commons”). Thus: one could ask. Are there ways to use this property rights to co-create together on commons art?

For example: pixel maps famously allowed people to co-create on artworks together, following simple rules for pixel ownership.


Currently, these projects are done for the joy of co-creation and doesn’t generate monetary returns. Due to these projects existing in a commons, a proposal exists to combine some ideas of Harberger Tax ownership towards commons art, such that ownership of some parts of it is combined with revenue generation and editing privileges. I proposed this combination at ETHSF. Two teams started building this, with one winning.

Another variation of this is Snark.art’s & Eve Sussman’s ‘89 Seconds Atomized’ where:

“Each token (or “atom”) contains a unique 9:44 minute 20x20 pixel video fragment of the original artwork ’89 seconds at Alcazar’ (in collections of MoMA, Whitney and Leeum museums).”

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Commons art doesn’t necessarily include visual arts. In narrative fiction, we are familiar with fan fiction and fan theories. These are extended universes created on the periphery.

‘A Universe Explodes’ is a good example of employing the combination of blockchain-based ownership over an extended universe. Created by Tea Uglow, it’s:

“A book about a parent whose world gradually falls apart.

Owned by a collective of people who progressively reduce the book to only one word per page.”

In this experiment, 100 versions of a book are shared. Every owner, during its ownership tenure, must add one word to every page, along with removing two words. Thus: every book ‘explodes’ in its own way.

I would argue that this project would flourish in its creative goals if it followed a Harberger property regime. If an owner is not doing anything with the book, it can be bought by someone willing to edit a version according to the rules. This avoids the current reality, where some versions might irrevocably be unattainable. During this process, the revenue can go towards various stakeholders: funding more experiments like this, funding all the authors (equally or weighted), or towards other creative commons. Thus: it not only allows the ‘Universe’ to explode per its goals, but also generate some revenue during the process.

Another favourite pioneer of approaching story commons, was Cellarius. What if we can combine this fan fiction into a co-created universe?

I feel there’s still much to do in exploring how not only to co-create on fiction together, but also enable the people who do, to make a living from it.

A favourite thought direction for me, first inspired by Cellarius proposals, is the idea of allowing forking/remixing in fiction, with participants staking to sub-graphs of a story universe, eventually having certain parts of the story be economically weighted. As I’m getting into fiction writing myself, I’m increasingly excited about trying this in the future. This aspect ties into the usage of economic curation markets and collective organisations, which I will deal with more in the next chapter on generative art economies.

Additionally: what if this shared universe has collectibles created for it, whereupon the digital collectibles fund the shared universe through revenue collected from Harberger Tax? The collectors become patrons of the shared universe.

Conclusion

To both empower creatives and create new art experiences means one can explore how ownership of these assets change our relationship to them. It can be economically beneficial & artistically meaningful. By rethinking some aspects of property rights we can co-create value together.

This is all intermingled with experimenting and exploring with generative art, DAOs and seeing markets as mediums themselves. I will cover this in the next posts.

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New Markets In The Arts #2: Generative Art Economies

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Storytelling Through Kishotenketsu And Knock Knock Jokes