Sotheby’s auctioned a non-fungible token (NFT) backed by the source code of the Web, coded by Sir Tim Berners-Lee in 1989. The NFT ended up selling for $5.4 million.
Unsurprisingly, Sotheby’s believes that the pricing represents the real value of the NFT, as clearly do multiple participants in the auction, half of whom had never participated at an event at the auction house before.
Auction participants, especially the new bidders, were likely crypto and NFT enthusiasts who have been following market trends over the last couple of months. Therefore they should have a good understanding of the value and volatility behind NFTs.
This NFT, in particular, is backed by a piece of history, and since the code itself is intangible, it seems appropriate to transform it into an NFT. The winner also received an animated video of the code being written, a scalable vector graphic of the full code, and a letter written by Sir Tim.
While the winner does not actually own the world wide web, owning the code behind one of the greatest and most innovative inventions of the last few decades is still pretty cool.
Meanwhile, The average price of NFTs peaked in mid-February at around $4,000 and plummeted by almost 70% to $1400 by April. Such a volatile change in prices raises the question about the industry’s financial sustainability and the real value behind NFTs. The hype around NFTs certainly inflated their worth at the beginning of the year.
The drop in prices was inevitable, and according to members in the industry, unsurprising. As such, it is intriguing to see another NFT being sold in the millions, and it begs the question as to whether it will influence artificially high pricing across NFT auctions.
As to whether this sale will influence future auctions, only time will tell. Nevertheless, auctions are market forces working at their finest. Therefore the pricing at which a piece sells, even if it is intangible, is the highest price at which the market agreed to value it.
Meanwhile, Sotheby will begin implementing a technology that mints “digital twins” of pieces of art as NFTs. The auction house also sold NFTs from digital artist PAK. And competitor Christie’s, besides selling the first-ever digital art as an NFT at an auction house for $69 million, also auctioned some of Andy Warhol’s work.
