Men, Status, and the World of Crypto Art
What the booming market for digital art and collectibles says about the relationship between traditional masculinity and NFTs
The Mandate Letter, by Jason Rogers, focuses on the evolving state of masculinity. Thanks for being here. If you were forwarded this email, get your own:
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This week we dive into the complex world of cryptocurrencies, specifically crypto art and collectibles, now commonly referred to as NFTs.
“I’m going to Disneyworld,” screeched Michael Winkelmann after the clock hit zero. The digital artist better known as “Beeple” had just witnessed the nail-biting close of an online auction at Christie’s for “Everydays,” his most prominent work.
With an hour to go, the price was already nearing an eye-popping $15 million. With just over a minute left, it skyrocketed to $50 million. Then, as the final seconds ticked down, it soared again to new heights, reaching a staggering total: $69 million.
Many were stunned, confused, or even outraged. How can you justify that enormous sum for a .jpg file that I could send you in a text?! However, techno-futurists reacted with glee. The sale was the realization of something they’ve long known: The art is market on the verge of radical transformation thanks to the technology underpinning cryptocurrencies and the development of NFTs.
When I first read about the sale, I too was skeptical. However, it didn’t take me long to understand why a collector would spend Basquiat money on some guy I’d never heard of (we’ll get into that in a bit). But the deeper I waded into this alien new world, the more I realized that it didn’t feel all that strange.
During my teen years, my friends and I spent countless hours reading the Robb Report, a magazine for guys that showcased expensive cars, houses, watches, and cars. Those glossy pages unconsciously taught me that possessing these rare objects would earn me the respect and admiration of other men.
The crypto world appeared to be sending me the same message. That is, it offered many equivalent ways to buy and display status. So, my curiosity shifted to a new question which this piece seeks to answer: What is the relationship between traditional masculinity and the exploding market for NFTs?
But first, a few things you need to know...
1. A quick primer on cryptocurrencies & NFTs
(First, a caveat. As I’ve noted, I’m relatively new to crypto; however, I’ve been researching this with such gusto that I feel confident navigating you through this world. That said, if you notice a misstep in my shorthand explanations, please don’t hesitate to point it out. If you’re a crypto veteran, then you should probably skip to the next section.)
The term “cryptocurrency” refers not only to Bitcoin but also to the thousands of other “coins” that make up the crypto landscape. For example, you might have heard of Dogecoin by now following Tesla billionaire Elon Musk’s infamous performance on SNL.
What ties all of these currencies together is the kind of technology that enables them. Underpinning each of these currencies is an open-source database (referred to as “blockchain”). This allows for the easy tracking and trading of value without the need for a central authority, like a bank, to oversee.
The second-largest cryptocurrency network is Ethereum. It differs from Bitcoin in that, in addition to allowing the transfer of monetary value, its blockchain can also execute basic rules defined by the people that interact with it (these are called “smart contracts”). This is what enables “NFTs.”
“NFT” literally means “non-fungible token.” If you can, for a moment, excavate the dusty and long-abandoned microeconomics section of your brain, you might remember that “fungible” means “interchangeable.” The US Dollar is fungible. A Bitcoin is fungible. M&Ms are fungible (unless you are one of those snobs that won’t eat the blue ones).
So if NFTs are “non-fungible,” what does that mean in the context of digital art?
Because digital artworks are replicable files (e.g., images, videos, animations, etc.), it’s challenging to differentiate copies from the original. However, when a creator “mints” their artwork, it becomes officially recorded on the blockchain, and the corresponding token (the NFT) is now saleable and 100% unique.
If I lost you there, suffice it to say that you, as a collector, can buy an NFT and be the verifiable owner of the corresponding piece of digital art1. The image, video, or whatever it is2 can still be widely distributed like any other digital file. But the NFT acts like a stamp of provenance and authenticity.
The analogy that made it click for me was that it’s like owning the master recording of a song. Many other people can possess the digital file or physical CD that plays that song. But only one person (or company) owns the master3.
NFTs can hold their value because they digitally scare as opposed to your average .jpg file, which nearly anyone can obtain and distribute for free.
2. How NFTs can act as digital status symbols
First of all, let’s put aside the $69m Beeple example because I think we can agree that buying anything from Christie’s, an art auction house where champagne practically flows from bathroom sinks, is an act of status in and of itself.
Instead, let’s talk about CryptoPunks, a series of 8-bit portraits that was one of the first digital projects to utilize the Ethereum network to create NFTs.
There are 10,000 of them in total; however, some portraits are more valuable than others because they possess rare attributes. For example, “Aliens,” “Apes,” and “Zombies” trade for more than those in human form. Although the creators initially gave them away for free, many Cryptopunks now command hundreds of thousands of dollars (a handful are worth millions4).
The fact that they are among the first NFT projects creates inherent value. However, the best explanation I’ve read that provides more context around these astronomical numbers came in the form of a recent tweet.
Below, prominent NFT collector “Gmoney” explains why he spent 140 ether5 (approx $300K) earlier this year on an “Ape.”
You can read the whole thread here. But what Gmoney is aptly pointing out is that our social media profiles now act like the walls upon which we hang our art. If you see a profile image of CryptoPunk, it signals that the owner is crypto-wealthy and in the know.
But, as I previously suggested, this isn’t the only way to flex status in the crypto world. Here is a tiny sampling of NFTs either currently on offer or that have recently been sold: Jewelry (4 ether = approx $10K), Sneakers (25.3 ether = $88K), Home (288 ether = approx $512K), Car (420 ether = approx $1m).
You might be thinking at this point, are you sure it’s mostly guys? Well, the data suggests that, at least for now, the answer is mostly yes6.
A recent study by the trading platform eToro reported that women make up only 12% of the Ethereum market (quick reminder: the Ethereum blockchain enables NFTs). Other research stated that only 4% of women are interested in collecting NFTs versus 15% of men.
Also, you can’t drive your crypto car down Rodeo drive or throw a lavish party in your digital mansion. So, you might also be wondering, how the hell do you show off these things?
To answer that question, we must enter the metaverse...
3. NFTs and status in the metaverse
Back in the early aughts, Philip Linden created Second Life, where users could explore, build, socialize, and even shop while navigating their avatars around a sprawling 3D space. It wasn’t the first example of the “metaverse” concept (a shared virtual world). But it was the first to become popular in the mainstream.
Since then, there have been many exciting iterations of these kinds of worlds. You may have heard of Fortnite7, an expansive video game with hundreds of millions of users. But what you probably don’t know is that back in 2018, it generated $1 bn by selling users dance moves8 and skins (yes, billion with a “b”).
What are skins? In these 3-D spaces, your avatar is like your digital body, and skins are that body’s accessories and clothes (and, in some cases, weapons). One-third of Fortnite players spend up to ten hours a week playing the game, which helps explain why they would be willing to invest in signaling that their digital identities are unique.
However, when you buy a skin on Fortnite, it’s locked within that game9, meaning you can’t transfer it to Roblox (another metaverse-like game). To anchor that in a real-world analogy, imagine buying a slick Tom Ford suit to wear to an event at a fancy hotel. Then, when you try to wear it to another event the following weekend at a hotel down the street, someone at the check-in says to you, “sorry, you can’t wear that here.”
However, new crypto metaverses like Somnium Space, Decentraland, and Cryptovoxels are unpinned by blockchain. This allows NFT owners to theoretically move all of their corresponding digital accessories and art from space to space10. (You can party in that Tom Ford suit wherever you want).
So you want to show off? Create a crypto museum in Somnium Space. Or wear those sneakers to one of the many concerts in Decentraland. Or simply roll up to a virtual shopping center in your sweet new crypto car.
And while the graphics do look somewhat childish, computer processing power is exploding at such speed that these ersatz digital spaces may soon feel indistinguishable from that which is real.
Hopefully, we’ve now established how and where NFTs are used as status symbols. But let’s try to answer why. Because not all status symbols are the same...
4. The Crux: Qualifying the notion of status display
It does appear that at least some of the activity around NFTs is motivated by guys’ efforts to create desirable optics. And this is a behavior of which I am not a fan.
When men overvalue how they present themselves to each other, they double down on the hierarchical hamster wheel that, for most, creates misery and shame. “If I can just make a little more money,” they think, “I’ll feel better.” What they are unconsciously thinking is, “I’ll feel better than someone else.”
I interviewed Mark Greene recently, and he summarized this perfectly:
The hierarchical domination-based culture of masculinity is designed to do a single thing: move power and wealth up. It’s designed to make us compete for status, and teaches us that if we are more successful at dominating the men around us, the more meat we’ll get—success, money, power, respect, etc. But for every person that makes it to the top of the man box hierarchy, millions do not. So all of us are chasing this rabbit around the track. A few thousand of us get to sit at the top of the pyramid. The rest of us are just cannon fodder, i.e., meat.
However, it’s important to note that there are various types of status-seeking behaviors. A guy might buy a 1956 Mercedes-Benz 300SL Gullwing because he wants to show up all of his wealthy friends. Or he may just be obsessed with vintage works of automotive art.
Summarizing his takeaways from the book, The Elephant in the Brain, Julian Lehr writes in his essay “Signalling as a Service”:
Signaling does not only explain luxury purchases but also consumption of all sorts of other goods: “Green products” are more about signaling a prosocial attitude than actually helping the environment. Other consumption signals include loyalty to a specific subculture (e.g. band t-shirts), athleticism & health consciousness (athleisure clothing) or intelligence (e.g. Rubik’s Cube).
By the same token (no pun intended), buying the aforementioned NFT jewelry could be motivated by the desire to mimic the dominating behaviors on display in hip-hop videos. Or it could just be a signal that you really want to connect with other superfans of Lil Pump (the hip-hop artist that sold it).
The thing to take away here is that guys spending mega-money on NFTs may be as interested in signaling knowledge, individuality, and belonging as they are in showing off wealth.
In other words, a rare, expensive NFT can send the hyper-masculine message, “I’m a big shot; look at me,” or it can offer a healthier one: “I'm really into this kind of stuff; who else is too?” It all comes down to intent.
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You can also sell NFTs attached to physical objects as well.
There can be multiple NFTs minted for one piece of art, but ignore that for now.
Ether is the name of coin traded on the Ethereum network.
However, that may soon change. An increasing number of female artists are selling NFTs, suggesting that they will bring more female collectors along with them.
I don’t believe these are technically considered metaverse spaces, but they are very metaverse-y.
These are called “emotes,” which are like digital dance moves.
Fortnite just raised a ton of money to realize the potential of a Fortnite metaverse space, so this may not be true for long.