Economist Magnus Resch on Profiting from Art in the Crypto Market

• Magnus Resch: Disrupting the Art World
• An Objective Approach to Art Collecting
• The Dynamics of the Art Market
• Reshaping the Art Market with NFTs
• Exploring the Power of NFTs
• Navigating the Future of NFTs
• Enlightening Aspiring Art Collectors with Insights
• Challenges and Future of the Art Market
• Art Market and NFTs: A Powerful Synergy
• Art Market and Money Laundering
• Resch's Favorite NFT Artists
• Categorizing Crypto Art

Magnus Resch: Disrupting the Art World

Magnus Resch, renowned art collector and referred to by CNN as "the world's leading art market economist, is no stranger to the multifaceted world of art collecting. Having managed art galleries, lectured in the Ivy League and sought to decipher the often murky realm of art collecting, Resch now presents his insights in a new book, "How to Collect Art," soon to be published by Phaidon.

An Objective Approach to Art Collecting

Resch's book aims to address the subjectivity of art collecting and present an objective approach to it. More than the everyday advice of "buy what you like," Resch suggests a systematic method to turn a profit from collecting. He highlights the importance of researching and categorizing the players in the market including artists, galleries, art fairs, auction houses and rival collectors.

The Dynamics of the Art Market

The art market can be a tricky space as it is easy to overpay for work that may find value in seemingly insignificant elements. An example of this is the non-fungible tokens (NFTs) market, which has been predominantly influenced by cartoon figures, typically animals, intended for use as social media avatars. Resch suggests that while many NFT projects may not recover from the market downturn, the technology behind it will fundamentally transform the way the art market economy operates.

Reshaping the Art Market with NFTs

Resch believes that NFTs will make provenance information more transparent and accessible, breaking down the historical mystique that the art industry has cultivated. NFTs can empower artists to forge closer ties with collectors, reduce barriers and facilitate entry into the market for potential collectors.

Exploring the Power of NFTs

Resch critiqued the obscurity of the art market, noting that it serves a small elite of collectors, galleries, and artists, while making it more difficult for most artists and art enthusiasts to connect. He shared insights on the key lessons for those interested in art collecting, how blockchain technology is revolutionizing the practice and why he believes the main issue in the contemporary art scene is the shortage of buyers.

Navigating the Future of NFTs

While most NFTs may retain their current status, which is usually significantly lower than at the height of their hype, Resch predicts that digital artists, such as Refik Anadol, will maintain their relevance as they have effectively integrated themselves into the conventional art market and its institutions.

Enlightening Aspiring Art Collectors with Insights

Resch's book aims to help prospective art collectors identify artists that align with their tastes. It offers guidance on pinpointing artists with investment potential and provides an understanding of how the enigmatic art market truly operates. The ultimate goal is to mold the reader into an informed and discerning buyer.

Challenges and Future of the Art Market

Resch highlights the ongoing problem of a lack of new buyers in the art market. Despite the rise in the number of millionaires and attendance at art events, the value of the art market has remained constant. This highlights a conversion issue, as the newfound rich are not transitioning into art buyers. Resch believes that a mix of education, entertainment, and transparency can aid in converting more art enthusiasts into active buyers.

Art Market and NFTs: A Powerful Synergy

Blockchain technology and its diverse applications have the potential to reshape the art market in a way previously unachievable. The amalgamation of digital art, cryptocurrency, and blockchain technology will cause a substantial structural shift in the art ecosystem. Collectors will demand blockchain registration for works, artists will have more control over their work and earn royalties from resales, and the art market will become more regulated.

Art Market and Money Laundering

Despite the perception of the art market being riddled with money laundering, Resch argues that such instances are not representative of the entire market and primarily affect less than 0.1% of all exhibiting artists.

Resch's Favorite NFT Artists

Resch's favorite artists working with NFTs include Kevin Abosch, Operator, Refik Anadol, Claudia Hart, Vera Molnár, Sasha Stiles, and IX Shells.

Categorizing Crypto Art

Resch disagrees with the idea of categorizing crypto art as a distinct category from other fine arts. He argues

Edited by Jonathan Stoker