With the sale of our first fully listed artwork–Andy Warhol’s Kiku — live, ArtSquare.io is getting ready to launch the second phase of its blockchain-based market, the ArtSquare Exchange. The Exchange is a digital forum where Art Investors can start trading their Digital Art Shares and enjoying the results of their disinvestment.
The ArtSquare Exchange
Just like in a traditional stock exchange, in ArtSquare.io’s Secondary Market buyers and sellers, offer and demand, come together, bringing about processes of uninterrupted, real-time price formation that are unprecedented for the art market. In the traditional art market, price tags for objects are formed as a result of a number of unclear, unstable and highly subjective factors. In addition to provenance (the track record of ownership of an art object), the inclusion in exhibitions and recent market performances of similar objects influence pre-sale estimates of an artwork, making any consideration on its real value and market potential highly speculative. These indirect processes of price formation are also dangerously discontinuous as they take place only when the artwork comes up for auction or is sold through a gallery.
ArtSquare.io’s system of digital listing of artworks wants to ease the pains of small Art Investors who struggle with these market dynamics. By turning the artwork into tradable shares, ArtSquare.io brings about a process of continuous price formation which eliminates liquidity gaps and high brokerage fees that plague the traditional art market. We see fine art as a new asset class of uncharted potential: through digital fractionalisation, investing in art will guarantee as good a performance as investing in shares of a company on the traditional stock exchange.
How Does the Sale of Digital Art Shares on the Secondary Market Work?
When the sale of Digital Art Shares on the ArtSquare Primary Market ends, we will bring on the secondary market phase. Through the ArtSquare Exchange you can disinvest your Digital Art Shares, allowing others in our community to own fractions of Artworks even if they did not get the chance to buy them through the primary sale during the listing stage. The ArtSquare Exchange relies on a business model based on sale and purchase orders. A Digital Art Share is placed on the Secondary Market at a predetermined price. The sale of a DAS is successful when the Art Investor’s offer meets the seller’s proposed cost for the share. Alternatively, Digital Art Shares can be sold at market value, with the selling order processed instantaneously based on the best available offers. All your transactions will be recorded in the Portfolio, where you can also check your shares and make informed decisions about how to trade them.
Own the Artwork for Six Months
The Secondary Market is not only a way to diversify your portfolio and make your profits grow; it is also your chance to interact with our community of Art Investors turned co-Art Owners, and make someone else’s dream of owning an artwork come true. As we have already explained here, the majority DAS holder for Kiku at the end of the sale on the Primary Market will be able to bring the artwork home for six months. The possibility to own the artwork by investing in portions of it is extended to the Exchange stage: at the end of the six-month period, the Investor who, at that moment, owns the greatest number of shares for the artwork–having bought them from the Secondary Market–will be its next Art Owner, and so on.
The ArtSquare Exchange is the final and most exciting component of ArtSquare.io’s new approach to art investments. Get ready for what’s next by buying shares for Kiku for €1 on the Primary Market now.