By Luke Whyte, Editorial Director
This is a story about a proclaimed act of NFT terrorism that was mistaken for an attempt at ransom but was actually a lesson in property rights.
Add a shot of whiskey to your coffee and let’s start at the beginning.
Early in March of this year, New York magazine’s Senior Art Critic, Jerry Saltz, contacted artist Kenny Schachter and asked if he would help him mint a collage of Saltz’ first 10,000 Instagram posts as an NFT.
“Should we make a NFT Beeple thing out of my 10,000 pics and sell it and split the dough?” Saltz wrote to Schachter, according to an article published by Schachter. “Exactly like his – collage thing – but ours. I assume it takes like two-seconds to make one. If not, whatever.”
Saltz’ intention with the project remains unclear. In an editorial for SuperRare, he stated that, “…the best way for me to get a metaphysical and physical handle on something is, if possible, to make, recreate or reimagine it myself,” so perhaps the project was a learning opportunity.
However, in the same article he wrote, “Many NFTs that have made the news don’t warrant one to look at them for more than one-second – and then to never look at them again. Our NFT fits into these categories,” and, on March 14th, he tweeted out an article that called CryptoArt, “a very boring sort of outsider art, made by nerds for other nerds” with his comment that, “If you read one article about NFTs – read this one”. So it wouldn’t be outrageous to assume this whole 10,000 Instagram posts NFT might just have been an attempt to troll the CryptoArt community.
On April 15th, Saltz minted ‘The First 10,000’ on SuperRare. A bidding war began, culminating in a 44E ($94,966 at the time) winning offer by a buyer using the pseudonym Alfred Itchblock on April 19th.
Itchblock remains anonymous. What we know is that he lives in Europe, claims to have made a considerable profit through DeFi investments and was happy to see some of his earnings spill into Saltz and Schachter’s charities.
Beyond charitable donations, however, Itchblock had loftier intentions with his purchase.
“Equally important is the opportunity that this NFT offers to educate traditional art critics on what the NFT revolution really is about,” he wrote in a blog post on the day of the purchase. “The NFT revolution is not simply about a new material or tool available to artists, it is much more profound than that. The core of the innovation is related to property rights, disintermediation and the removal of gatekeepers.”
“I will be deploying a specially crafted custodian contract to demonstrate what’s so powerful about ownership of art via smart contracts,” he wrote.
And then we waited.
On May 1st, Itchblock transferred ownership of ‘The First 10,000’ to the aforementioned contract.
“I am no longer the owner of ‘The First 10,000’,” he wrote in a second blog post. “The SuperRare token (id #23500) is now in complete custody of an immutable automated contract which will forever alter its destiny. There are only two possible outcomes: either “The First 10,000” is rescued and the original NFT goes back into circulation, or it gets shredded to address(5000) and a new “The First 10,000 [shredded]” token is issued.”
“Shredded?” you ask. Yes, Itchblock intended to perform a digital version of what Banksy executed when his work was auctioned by Sotheby’s in 2018. Unless, of course, Saltz took action and admitted, as Itchblock put it, that, “CryptoArt is legitimate”.
Specifically, Itchblock’s contract (which now held custody of ‘The First 10,000’) was programmed to execute one of four functions over the next month. As he described it on May 1st:
Phase 1 (from now until May 14 9:30PM UTC): Jerry has complete control over the fate of “The First 10,000”. He can choose to call saveit_CryptoArtIsLegitimate() to return the original “The First 10,000” NFT to me. Alternatively, Jerry can shredit_WasALowEffortNFTAnyways() to send his own creation into address(5000) in which case I receive the shredded version of it. With highest likelihood, Jerry does nothing which brings us to phase 2.
Phase 2 (from May 14 to May 28): anyone can shred “The First 10,000” as long as they donate 440 ETH to the Gitcoin Grants Official Matching Pool, all fully automated through the same custodian contract. In this scenario, “The First 10,000” is sent to address(5000) and the donor receives the newly minted “The First 10,000 [shredded]”. This is done with shredit_ForPublicGoods().
Phase 3 (starting on May 28 9:30PM UTC): if nothing happens to the NFT by May 28, anyone can call shredit_ForTheLulz() to send “The First 10,000” into address(5000). A 0.4 ETH gas bounty is provided to create an incentive for someone to do so. In that same transaction, “The First 10,000 [shredded]” is minted to my own account.
Itchblock wanted to prove a point about digital property ownership. The shredded NFT wouldn’t exist on the blockchain unless the shredder was executed, at which point the original artwork would be lost, stuck forever in the shred address(5000).
Saltz would get to decide if his artwork remained or was replaced by the shredded version.
“Do you really own a painting if it’s locked away in a safe on the other side of the planet?” Itchblock said, referring to traditional art ownership and preservation. “Most Right-click and Save folks would say you do because by now it’s widely accepted that you can own things through pieces of paper. People generally take legal systems, law enforcement and a bunch of other social constructs for granted. NFTs are the next evolution after ‘ownership through pieces of paper’.”
On May 8th, Itchblock wrote a third blog post describing how the NFT shredder worked and emailed the link to Saltz and Schachter.
“I have no idea what any of this means,” Saltz replied, according to email transcripts provided by Itchblock.
“A concrete consequence of ‘The First 10,000’ being shredded is that it stops being transferable,” Itchblock replied. “It’ll be ‘lost’… Not being transferable means it can’t ever be resold so you’ll never get royalties from secondary sales. Hence NFT terrorism :)”
Perhaps due to the fact that Itchblock more than once referred to his shredder as “NFT terrorism”, Saltz took to Twitter to accuse him of ransoming ‘The First 10,000’:
“Alfred Itchcock is the silly name of the tech-person who bought my and @kennyschachter “The First 10,000” for around $95,000,” Saltz wrote, “I am not sure why, but this tech-collector-pseudo-conceptual NFT artist person has been writing me/Kenny threatening emails saying he was going to “shred” our NFT unless I paid him “a transaction fee of anywhere between $2,000 – $10,000 …to teach Saltz a lesson.”
I’m not sure if Saltz intended to misspell “Itchblock” as “Itchcock”, but I’m glad that it happened.
“Jerry – you have the most important detail wrong!” Itchblock responded via email. “I pay YOU 2,000 if you decide to interact with the custodian. It’s actually 0.466 ETH which varies against USD. Right now closer to 1500 USD.”
Schachter chimed in: “We wouldn’t pay 5 cents to save this NFT, so your point (whatever that may be) is moot. Knock yourself out and have a ball.”
He later wrote in a blog post, “This encounter affirmed one thing for sure: techies are weird.”
On June 6th at 2:49AM UTC, shredit_ForTheLulz() was executed by an arbitrage bot, the custodian contract issued the “The First 10,000 [shredded]” token, transferred it to Itchblock and send Saltz original “The First 10,000” to die at address(5000) where it will remain, inaccessible, for the remainder of eternity.
I don’t think Jerry Saltz understood why, mostly because I don’t think he cared.
Itchblock had set out to clear up confusion in the traditional art space about the value and future of NFTs but, if anything, managed to show just how far away the Crypto community seems to be from communicating with the traditional art community, even with critics like Saltz who seem genuinely interested in the space.
Itchblock and Saltz do agree on one thing though: This is just the beginning. Saltz might not see much value in the artwork that’s been minted so far, but he’s optimistic about NFTs.
“Someday, there may be a Francis Bacon of NFTs,” he wrote in an article for Vulture. “But so far, the NFTs that have gotten attention for making art history have been singularly unoriginal on any visual level.”
Itchblock continues to preach that this sort of criticism misses the point. Referring to a panel Saltz participated in titled, “Are NFTs a fad or the next chapter of art history?” Itchblock wrote, “That’s such a weird question. It’s like asking “Is the justice system just a fad or the next chapter of art history?” NFTs are related to art just like courts and physical law enforcement are related to art. It’s weird how art people think NFTs are exclusively an art thing. I really thought my stunt would help you understand all this but I’ve failed.”
Despite this failure, Itchblock’s message remains true: The NFT revolution is larger than art alone.
As Matthew Ball wrote: “Just as it was hard to envision in 1982 what the Internet of 2020 would be — and harder still to communicate it to those who had never even “logged” onto it at that time — we don’t really know how to describe the Metaverse.”
“25 years from now we will be interacting with NFTs on a daily basis and most people won’t realize it,” Itchblock said. “The invention of NFTs on Ethereum is on the same level as the invention of courts, property rights systems and law enforcement. The art world will adopt it just like it adopted the idea of putting a physical canvas for sale through 3rd parties and transferring its ownership with pieces of paper.”
I’ll end this article with a quote from one of Alfred Itchblock’s blog posts that I think summarizes the situation well:
NFTs are not exclusive to art just like the meatspace property rights systems are not used exclusively to track ownership of physical art. It just happened that artists were among the first ones to see that we could build an alternative system with this new technology. Early cryptoartists are being rewarded not only for their amazing content, but because they have been contributing to the vision for years.