4ARTechnologies Group (4ARTechnologies Holding AG and its subsidiaries) – hereafter referred to as "4ARTechnologies" – is building a blockchain-powered cataloguing and transactions platform to bring greater transparency, security and process efficiency to the art world.
At the heart of the platform lies a patented “augmented authentication" technology made available through our unique technical partner Atlantic Zeiser GmbH. By allowing users to log an artwork’s “fingerprint” on the blockchain along with all important information on history/provenance, this technology renders registered artworks essentially unforgeable. Requiring nothing more than a standard smartphone, this first-of-its-kind solution doesn’t just combat the problem of art fraud, but provides highly relevant use cases for all art world players.
- Eliminates the problem of art fraud Once an artwork’s “fingerprint” has been captured, all it takes to check that artwork’s authenticity is another quick scan using the mobile app. Since this fingerprint – along with all other vital information on history and provenance – is stored on the blockchain, it is tamper-proof.
- Creates transparency at no expense to privacy The industry has long resisted the creation of a centralized database due to privacy concerns for investors and artwork owners, and the lack of a practical technical solution. Thanks to blockchain and smart contracts, buyers’ and sellers’ privacy is guaranteed at every step of the way. And with added transparency around history/provenance, the market will become more secure and transparent for all established players, and more accessible to new investors.
- Brings novel efficiency to condition and restoration reporting Condition reports are part of virtually every transaction in the art market, from insurance to logistics to sales – at least in theory. Practically, there has not been any good solution to do these efficiently. With the 4ART mobile app, both condition and restoration reports are bound to become a matter of minutes for a fraction of the established cost.
- Makes managing portfolios easier than ever The 4ART platform as a service helps users maintain all ownership certification, lending, restoration, transportation and insurance coverage related to an artwork – for owners of individual pieces as well as galleries and museums with large portfolios. The information related to the object and the user can be separated on demand, allowing for the greatest transparency while keeping individual anonymity.
- Empowers artists to earn from resales of their works Like any other holder of intellectual property (e.g. writers or musicians) artists, too, are entitled to gain royalties from their works. Due to the intransparency around resales, this rarely happens. With the 4ART platform’s smart contracts, artists can now be notified whenever one of their works is being sold – and earn without compromising buyer privacy.
- Market Potential While art has long been a prized asset for investors looking to diversify their portfolios, the most recent numbers on the art market published by Art Basel and UBS in their report on “The Art Market 2018” reveal the true potential of a vibrant and growing market. Having grown by 12% since 2016, the market’s annual turnover in 2017 amounted to $ 63.7 billion, broken down into 39 million individual transactions – the highest number of transactions since 2008. The fact that the number of transactions grew by only 8% suggests that the average value of artworks traded has in
4 creased. However, included in these figures are only those transactions that are carried out by galleries, auction houses or other commercial sellers.
With the inclusion of private sales, the market is more likely in the range of $ 100 billion.
With 4ARTechnologies’ solution being of immense value to logistics providers, let’s take a look at the transportation volume: TEFAF’s Art Report 2017 details the turnover through import and export of artworks. At an average price of $ 5000 per image – according to TEFAF, 80% of artworks traded in 2017 were in the lower price segment – this amounts to 13.5 million cross-border transports.
Then there are the art fairs, one of the central sales avenues for artworks. 10 global cities are host to the 70 most important fairs, each of which features roughly 30,000 works offered by 350 vendors from EXECUTIVE SUMMARY.
This makes for approximately 2.1 million transports, all requiring condition reporting and insurance. In addition to the larger art fairs, there are about 100,000 local exhibitions and gallery openings. If each of these includes 20 images, then the number of transports grows by another 2 million. If 50% of the exhibited works are shipped back, then the total sum of transport movements in connection to art fairs, exhibitions and shows is upwards of 6.1 million.
You can get an exact overview of the market potential by using the stored charts.