Summary List Placement
It was a Friday in December of 2020. I’d just gotten home from work and I was laying on my couch, listlessly scrolling on my phone, flipping between Reddit, Twitter, and Instagram. I came across an Instagram post by Beeple, a digital artist that I’d been following for a few years. It was a video featuring Beeple himself, aka Mike Winkelmann, which was unusual since he typically only posted his art.
I work for one of the largest cannabis companies in California, THC Design, and though I’m one of the founders of the company and make good money, I’m not rich by Los Angeles standards — yet. I had no idea that spending $969 on a work of art would, within three months, turn into an asset valued around $300,000: One of the Beeple pieces (that I own) recently sold for $288,000 and the current lowest price for one is $289,000.
When I clicked onto his Instagram video, I expected some edgelord in a hoodie, but he looked more like an accountant in his late 30s. In a thick midwestern accent, he explained that he was about to do a “drop” of something called NFTs on the website Nifty Gateway.
I had no idea what an NFT was and I’d never heard of Nifty Gateway. But he enthusiastically explained it was a new way to collect digital art and was somehow tied to the blockchain Ethereum, which lets you verify ownership.
But collect digital art? I really didn’t see the point.
Why would I pay money for a jpeg or gif, when I could just save it to my computer for free?
Then he showed that these NFTs would also include a physical element: a sleek digital display screen, encased in acrylic, and it looped the gif you were purchasing. It was a way to enjoy your NFT art in the real world and show it off.
The displays would come in a big black box with a cleaning cloth, certificate of authenticity, and a hair sample for some weird reason. In typical Beeple-humor, underneath the hair sample was a disclaimer stating it was “definitely not pubes.”
They looked really cool. I’d recently moved into a new office and had been purchasing some art to decorate it. I’d spent a few hundred bucks on an original piece by another Instagram artist I was following, and it really made me happy to see it every day. There was also a strange sense of pride and enjoyment knowing that I owned the only one.
I thought one of the Beeple displays might be a fun tchotchke to have on my desk.
So I checked his Twitter. The drop was starting in less than an hour. I went to the Nifty Gateway site and saw there were three different options to purchase:
- The first was an NFT called “Everydays Raw,” a scrolling gif (like an animated rolling slideshow) of several of his original art that he had been producing daily over the past year. It would be sold for only $1, and there would only be 100 available for purchase. These $1 pieces did not include a physical token.
- The second option consisted of three “Open Editions” for $969, which would only be available for five minutes. So as many people that could purchase them within that five-minute period was however many would be minted and sold. These included the physical token display screen and hair sample.
- The third option was 21 unique 1 of 1 pieces that would be auctioned. My favorite was a picture of a skeleton in an astronaut suit laying in a field of grass and flowers. But I figured if the “Open Editions” were going to sell for $969, the 1/1s to be auctioned would go for a few thousand, and that was definitely more than I wanted to spend. I had no idea just how expensive they would be.
So I made an account and registered my credit card. I decided that I’d get one of the $969 Open Editions (a gif of Pikachu’s rotting corpse called “Infected Culture”) and I’d also try for one of the $1 “Everydays Raw” pieces — why not, they were only a dollar.
The countdown clock clicked down. As it hit zero, I refreshed the page and clicked the buy button for the “Everydays Raw.”
It was already sold out. It couldn’t have been more than 1 second.
The clock was ticking on the Open Editions and my sense of FOMO started to build. I had to decide if I really wanted this. $969 was a lot of money, but I’d spent more than that on trips to Vegas. I figured this might be a better bet.
I clicked to purchase the Pikachu. The purchase didn’t go through. I tried again and once again the transaction errored. The five-minute period was almost up. I clicked “purchase” a third time, and a spinning icon rotated for what seemed like more than a minute and the clock continued clicking down. Finally, the site confirmed the purchase and the screen filled with digital confetti and a congratulations message. I got #100/123.
I still really didn’t know what I’d bought or if it was even worth $1000.
But I figured maybe I’d be able to sell it for double in a year or two. There seemed to be a collector aspect to it, and there was obviously a lot of hype and demand.
They were selling for double 10 minutes later. I had no idea why.
Then the third option, the auctions, started. Right away, I realized that I definitely couldn’t afford one of those. The first piece (a stunning ethereal picture of a baby goat surrounded by surreal otherworldly flowers) sold for $77,000. It was purchased by MetaKovan, the person behind MetaPurse, the largest NFT fund in the world. It would later be revealed that MetaKovan won 20 of the 21 editions.
In the end, Beeple pulled in $3.5 million dollars over the course of three days.
I messaged a friend of mine who works in media and asked if he’d heard of Beeple and the auction. “I feel like this should be bigger news. Why aren’t mainstream outlets covering this story?” He dismissed it as a bunch of “crypto freaks” with nothing better to spend their money on, but I knew that couldn’t be true. I’m not a “crypto freak.”
People were reselling their Beeples, and I checked Nifty Gateway every day to see the latest sales on the secondary market. Every few days the price floor would go up by a few thousand dollars. I remember thinking that only 10 more would have to sell for the cheapest one to be worth $10,000.
It kind of broke my brain. I began to not be able to think about anything else.
I told a coworker about it. I speculated that maybe in a year or two it could be worth $100,000, but who knew, maybe it would be worth nothing.
A week or so later, I circled back with my friend. The most recent one had sold for $27,000. He told me to sell it. I didn’t.
Another couple of weeks passed and one had sold for $122,000. My sister told me to sell it. I didn’t.
Then Christie’s auction house announced that they would be auctioning a Beeple NFT, a collage of his first 5,000 Everydays. There would be no physical token included, it was going to be solely for the digital file.
At first, I had a hard time reckoning with the idea of owning something that was purely digital.
It was the physical token that got me into NFTs, but after I watched the value of other artists skyrocket, I’ve since purchased two more by an artist named Billelis simply because I liked them. The original price for those was $250 each and now they’re selling for around $2,000. While not quite Beeple numbers, it’s a decent increase in value in just a few weeks.
Will I purchase more purely digital NFTs? I guess it depends on how much I like the art. It wasn’t really my intention to get into this as an investment.
The day my physical token display screen arrived, the New York Times published an article on Beeple and the upcoming Christie’s auction. I figured this would be a good time to tell my dad — an article in the New York Times would make me sound less crazy. I shared the article and tried explaining it to him over email. His next email to me didn’t mention it.
The Christie’s auction lasted 15 days. Bidding started at $100, and within the first 10 minutes went up to more than a million dollars. By the end, bidding had gone up to over $69 million dollars, making it the third highest price ever paid for a work by a living artist.
The next morning, Beeple was on the TODAY Show and my dad emailed simply: “$69 million! Wow!”
When I was a college radio DJ, I had a knack for picking up-and-coming bands that would later go on to find massive success. I remember wishing I could somehow invest in those bands. Buying a Beeple feels like I’ve finally been able to do that.
I’ve listed my Beeple, Infected Culture #100/123, on Nifty Gateway for $1,698,888.
Even for that price, I still wonder if I should pull it off the market and just keep it for a few years, but a bird in the hand, right? I don’t know if it will ever sell, but it’s a figure I’d be happy with. I picked that price point because it seemed like a realistic estimate of the near-term value of the piece, since two NFTs called CryptoPunks, recently sold for $1.6 million and $7 million.
If my piece sells, after fees and taxes, I’d still have more than a million dollars. It’ll sting if it ends up being re-sold again for $5-10 million a few years later, but it won’t sting as badly compared to the people who sold theirs for $2,000 the day they went on sale. I think I could be happy with a million.
I still haven’t opened the box, in case it might be worth more in mint condition. I know I said I had originally wanted to purchase this for office decor, but once the floor price hit $5,000, I decided it might be better if I didn’t open it.
If you’re interested in getting into NFTs as an asset or way to make money, unfortunately, I don’t really have any advice for you.
I stumbled into this. And right now, there is talk of a bubble. People are comparing this craze to the “Tulip Mania” of the Netherlands, when during the 1600s the price of a tulip was higher than the cost of a house in the center of Amsterdam.
But this feels like the beginning of something that we can’t even comprehend yet. In the future, more and more people are going to be spending their time in virtual reality, and NFTs have infinite potential when it comes to ownership of digital assets. There are already digital, virtual museums that have been created in virtual worlds such as Decentraland and Second Life.
So are we in a Beeple bubble?
I don’t think so. He now ranks with some of the most famous living artists, and I think that his prices will only go up.
If you’re just getting into NFTs, it might be too late to hop on the Beeple train unless you have hundreds of thousands of dollars to spend. He is keenly aware of the power of scarcity when it comes to creating value, and he plans to strictly limit the total number of pieces available. So it’s doubtful that he’ll ever do another “Open Edition.”
Has my life changed at all? So far, not by much.
I’m less stressed at work and have a more positive outlook towards the future, but that could also just be related to the pandemic finally winding down. I’ve been trying to eat healthier and lose some weight. I’ve thought about maybe getting a new car.
Yesterday, I was standing outside Yuca’s taco shack in the Los Feliz neighborhood of Los Angeles and a beautiful woman walked by. She seemed to check me out. Could she sense that I owned a Beeple?