The art market is notoriously opaque and many would go as far and say that it is one of the largest unregulated industries in the world. There are certain rules but it is lacking transparency and its players can get away with suspicious and ethically questionable behavior.
Due to the high entry barriers, the art market remains narrow as players must have the expertise and an extensive network to navigate within the market. Major artworks of the top-tier artists are prohibitively expensive hence only accessible to a select few. Investors whose strategic asset is art don’t have the right financial tools for hedging, getting exposure or participating in a deal, and whilst a classical financial market offers investors options to purchase a part of a company through shares, e.g. by investing in 10 barrels of oil without having to own and transport it, the art market is behind. Existing derivatives on art are somewhat primitive and there are no cash-settled contracts to smoothen the risks and achieve the desired exposure.
Under these circumstances, it is only the large players with expertise and financial means that can influence the market and make the most money.
Technology has been booming over recent years and the rise of blockchain, artificial intelligence, and big data has revolutionized the financial sector, which is the most conservative but also the biggest and thus lucrative sector in the global economy.
Our knowledge of the art market, financial derivatives, and new technology will help to create simple and transparent ways to invest, attract liquid funds, borrow against them and take a position by buying or selling short in fine art.
The Art Exchange will not only serve as a financial tool for existing art investors and market players but also attract new ones from the financial sector. And as with all financial tools, derivatives will make the art market more accessible, so building your portfolio of the Monets, Rembrandts, and Van Goghs is no longer out of reach.
Buy insurance, provide a guarantee or make a complex financial contract on a future artwork sale
Participate in future auctions and sales of the leading auction houses such as Sotheby’s, Christie’s and Phillips with as little money as you want
Have a share in world-famous artworks and trade peer-to-peer derivatives on it
Provide a loan that is overcollateralized against an art piece and earn attractive interest
Tokenize selected artworks from your collection if verified by the trusted art experts and institutions
Borrow money against your artwork anytime you need liquidity