Blockchain Certification Arrives In The Worldwide Art Auction Market

by Fox Rothschild LLP
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In recent art world news, Verisart has launched the “P8Pass,” developed in partnership with online auction house Paddle8, to offer blockchain certification and authentication services to the worldwide art marketplace.  According to Paddle8’s website, the “P8Pass is a digital certificate with data encoded continuously onto the Bitcoin blockchain.  The certificate will be offered for any work of art or object purchased on Paddle8 and will detail provenance including ownership history and artist authorship.  P8Passes will leverage the Bitcoin blockchain to build a decentralized database containing certificates of authenticity and provenance for artworks providing a guarantee, accessible and verified at any time.”  Buyers, consignors and partners will have access to the P8Pass in all curated and benefit auctions featured on Paddle8.

Paddle8 believes that the P8Pass has “the potential to significantly reduce transaction costs for the trade with art [and] collectibles and broaden the market by including new buyers encouraged by authentication process simplicity and transaction safety offered by the P8Pass blockchain product, the risks traditionally being the primary reason for affluent consumers to stay away from the art trade.”

Paddle8’s strategic investor, The Native SA, believes that this innovative new application of blockchain technology to the art market has “the potential to disrupt the art market for good[.]”

Verisart claims to be “the world’s leading platform to certify and verify artworks and collectibles using the Bitcoin blockchain.”  Since the start-up’s 2015 launch, Verisart has offered contemporary artists a simple way to generate permanent certificates of authenticity and reduce the extent of fraudulent activity.  Verisart “combines museum certification standards, distributed ledger technology and image recognition to its provenance and registry services.”

In addition to its partnership with Paddle8 on development of the P8Pass, Verisart has partnered with ArtSystems to offer blockchain certification to leading galleries throughout the world.  This would be the first art inventory management platform to integrate such kind of blockchain-based certificate.

New start-up Codex Protocol is another player, among others, entering this dynamic growing field of placing art on the blockchain.  Specifically, the start-up is a blockchain-based decentralized title registry for art and collectibles.

This is certainly a fascinating area that I will be keeping an eye on in the application of blockchain technology to the global art market.

[View source.]

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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