The First Decentralized Art Gallery
Now everyone in the world can acquire fractions of artworks as an investment, which can then be traded in a fine art exchange to other investors. In this aspect, Maecenas acts as a sort of NASDAQ for the fine art world.
MAECENAS COULD BE THOUGHT OF AS THE NASDAQ OF FINE ART
Coinist was recently fortunate enough to chat with the folks at Maecenas, a blockchain based platform that democratizes access to fine art. Let’s jump into the interview.
First of all, thanks for chatting with us today. Let’s begin by catching our audience up to speed on what Maecenas does. Can you give us a brief summary of your platform objectives?
Maecenas is the first decentralized art gallery. We let everyone in the world acquire fractions of artworks as an investment, which can then be traded in our fine art exchange to other investors. In this aspect, Maecenas could be thought of as the NASDAQ of fine art where each painting or sculpture will have its own unique code and investors could buy and sell shares in those works of art with each other.
We leverage the use of blockchain technology to provide full transparency and security to the investment process. Our provenance records are protected by cryptography and therefore are tamper-proof meaning that they can’t be falsified. Our vision is to democratise the art market industry by letting everyone participate in it and acquire shares in multi-million dollar masterpieces that today are only available to the ultra rich.
On your website you mention that “a wide range of academic studies published in scholarly journals conclude that holding art in an investment portfolio offers important financial and risk diversification benefits.” Do you predict that the majority of users who use your platform are using it as an investment tool? Are there any other use cases or user profiles that don’t fit in this box?
Our value proposition goes beyond the creation of a fine art portfolio. Maecenas is creating a whole new experience about how people perceive art. Artworks in our platform will be kept in either museums or secure vaults with viewing facilities so that investors can visit them and enjoy the art collection they own. Bringing fiends and family will be possible too.
You mention the different types of users who could use your platform. You mention that galleries wishing to make a big new purchase could use your platform as an alternative to the traditional loan route. Maecenas will charge a 6% listing fee which is considerably lower than what many banks would charge. What other incentives to galleries have to use the Maecenas platform?
For galleries in particular, Maecenas is a great sales channel. Artworks listed on our platform will gain instant worldwide exposure to our global network of investors. The fact that Maecenas has a very strict due diligence process for curating and vetting artworks, added to the trust and transparency created by blockchain, means being listed in Maecenas will represent a seal of approval that will immediately increase the perceived value of the asset.
Now let’s talk about the average art investor. This was one of the features of your platform which excited me the most, but I also think I understood the least. Essentially, the average investor has very low barriers to entry when it comes to investing in art on your site. Other than the small 2% fee, the investor could invest as little as $2 if they pay with cryptocurrency. Let’s look at this use case from a couple of different angles. First, in terms of investment, let’s imagine that I’m an investor and I invest $1000 in a piece of art which gives me a share of the art in proportion to my contribution. I use ART token (your internal digital currency to purchase the right to my percentage). If I’m speculating, I will then wait for the price of the art to go up. Tell me more about what the exit strategy looks like for this type of investor. Is there an exchange where I can gain liquidity at anytime? Or do all investors need to wait for a sale of the piece of art in order to establish the value of each user’s stake? If you allow users to exit early, how is that buy / sell price set?
We get asked this question a lot. Every investment needs an exit strategy and fine art is no exception. One of the revolutionary aspects that Maecenas is introducing is liquidity. Fine art is typically a very illiquid asset, and therefore needs a carefully planned exit strategy if you expect to make a profit. This is why art funds have lock-in periods of five to yen years.
However, Maecenas operates a real-time art exchange meaning that as an investor you can liquidate your position and “cash out” at any time that seems convenient for you. We understand that our markets won’t be as liquid as popular stocks like Apple or Google, but certainly liquidity will be there as it is much easier to find a buyer for your $1,000 share of a Picasso than a buyer for your whole painting worth $5,000,000.
You have some samples of how your demo platform might look. Do you mind sharing them now and walking us through what we’re looking at?
We have released a sneak peek of our platform where we share a screencast (short 1-minute video) of our platform and also comment about the exciting features that we have in our roadmap. You can view the screenshots here.
I notice in one of your demo graphics on your site there are charts which look similar to stock tables with the price movement of the asset over time. Many asset classes have liquidity where buyers and sellers create those dynamic price movements regularly throughout the trading day. Pardon me for not knowing how this works in the art world (or maybe I’m misunderstanding what the chart is) but how does live price fluctuation work in the art world? It seems much more abstract.
Art is traditionally traded infrequently, maybe every few years, so pricing information is very scarce and sparse. Maecenas is addressing the problem by operating a real-time art exchange for shares in painting and sculptures. Trading at Maecenas will generate and abundant amount of prices which will be great for investors who want to stay on top of their portfolios and be able to value them accurately. This is truly revolutionary for the art market!
Thank you greatly for taking the time to speak with us today. We wish you the best of luck with your project and ICO. To our audience, if you’re interested in learning more about maecenas you can visit their website here: https://www.maecenas.co
Thanks for inviting me to this interview. I wanted to take the opportunity to remind the audience about our token crowdsale which is happening this coming September 7th. To participate you just have to visit https://cofound.it/en/projects/maecenas/.
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