Editor’s Note: This is an excerpt from Token Supremacy: The Art of Finance, the Finance of Art, and the Great Crypto Crash of 2022, an investigation into the murky waters of NFTs and the art world by New York Times reporter Zachary Small. It releases May 21 from Knopf.

When rich collectors want to celebrate exhibition openings at the Museum of Modern Art, they rent a backroom at the museum’s two-star Michelin restaurant where the windows look onto a marble courtyard of priceless Giacometti statues and whatever else the curators have decided to rotate through the acid rain.

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One might describe the sound of clinking champagne glasses that emanated from the backroom as heraldry. November 18, 2022 was close to the two-year anniversary of the NFT boom, and those assembled at the restaurant were as happy celebrating their own survival through the crypto crash as they were toasting the artist who convinced the establishment to destroy the last barrier between culture and nonfungible tokens.

Refik Anadol had emerged from the same digital art communities that nurtured the careers of artists like Mike Winkelmann; however, the Turkish-American artist had three fine art degrees and a thriving studio practice with a dozen employees by the time he started selling NFTs. His early successes came from public art installations in airports and shopping malls where he installed swirling datascapes of colorful abstraction. The artwork would change in real-time based on a machine-learning algorithm developed by the 37-year-old artist and refined during his 2016 residency with Google’s Artist and Machine Intelligence project. Two years later he staged one of his Machine Hallucinations, feeding an artificial intelligence program more than 300 million images and 113 million other datapoints so that it could draw its own images of New York City. Anadol described the experiment as entering a “dream” inside the “mind of a machine.” Visitors found the results absurdly moving, like a long supercut of memories stitched together from the internet’s archive of tourist photography.

His first NFT project in December 2020 applied the Machine Hallucinations model to Renaissance art. The results were lackluster: melting imitations of marble statues you might expect to find among the wax candles at the Vatican Museum. Crypto investors bought the artworks for a couple hundred dollars, anyway, which was enough to keep Anadol interested in the blockchain. A year later and the artist had become a modest success in terms of the NFT boom with his artworks selling for several million dollars. He didn’t have the same name recognition as Mike Winkelmann or Tyler Hobbs, and he didn’t have the same corporate backing like Justin Aversano or Erick Calderon. But he had the hunched posture of a traditional artist and spoke in a language that the art world understood.

Courtesy of Knopf

MoMA stayed quiet during the NFT boom cycle, although behind closed doors the real estate tycoons and gonzo financiers on its board were interested in the crypto market. A secret task force was assembled not long after the 2021 Christie’s Beeple sale with the museum’s chief financial officer, Jan Postma, and the curators Michelle Kuo and Paola Antonelli.

The museum struggled through Covid-19 like most cultural institutions, arduously attempting to recover its high attendance records and financial support from before the pandemic. The same conditions that fomented the digital art renaissance were killing art nonprofits. MoMA director Glenn Lowry talked about taking a “chainsaw” to his budget. The museum had its $180 million budget slashed by a quarter, its workforce reduced by 160 employees, and its dozens of freelance educators fired. Things were not looking good in early 2021.

The NFT task force was searching for a savior and found one in Anadol, who then produced a Machine Hallucination series based on 138,000 images and text materials from the museum’s archive. The hundreds of resulting images—living vortexes of swirling colors and undulating forms—were sold as NFTs for $1.8 million with at least one artwork purchased for $200,000. And although MoMA never formally announced its participation, the museum received nearly 17 percent of all primary sales and 5 percent of all secondary sales.

Receiving more than $300,000 from the NFT sale without expending any of its own resources had convinced MoMA executives to embrace the crypto communities and their chosen artists. Kuo and Antonelli were empowered to continue expanding the museum’s digital footprint by hiring a Web3 associate and developing an exhibition for Anadol in the institution’s public lobby—an honor typically reserved for the most prestigious artists in the world.

“Being open to new technology is part of our responsibility,” said Antonelli, the museum’s senior curator for the department of architecture and design, who is known for guiding MoMA’s acquisitions of historical video games like Pac-Man and the @ symbol. “We are never jumping on new technologies, but rather realizing that we need to keep pace with the world.”

An outsider looking at the arrangement might accuse MoMA of trading its credibility for crypto, but that would ignore the finesse with which payola is handled in the art world. For a museum that typically needed five years to plan its exhibitions, this one happened within only a year. Refik Anadol: Unsupervised opened in November 2022 using an updated version of the Machine Hallucinations algorithm that created the NFT series, which provided a good reason for the curators to start relationships with some of Anadol’s crypto patrons.

This is how Pablo Rodriguez-Fraile and Ryan Zurrer were finally welcomed into the traditional art world. These businessmen had become two of the most prominent NFT collectors, thanks to their association with Beeple. Rodriguez-Fraile was an early collector and bought the artist’s first release, Crypto Is Bullshit, in 2020 before turning into one of the highest bidders for digital artworks at the auction houses. Zurrer offered close competition. Not only was his $29 million purchase, Human One, still touring museums around the globe, but he had recently discussed commissioning Winkelmann for a 42-foot-tall version of his Dick-Milking Factory NFT, which featured an erect penis the size of a skyscraper with elephants stimulating the testicles to increase semen production. The new version would be plopped in a Brazilian city.

From a mutual respect came a partnership. The businessmen split the cost of the most expensive Machine Hallucination from Anadol’s MoMA series and soon struck a friendship with one of the most influential trustees at the museum, Pamela Joyner, a wealthy collector specializing in African-American art whose venture-capitalist husband, Fred Giuffrida, also dabbled in the crypto markets.

“Pamela had a concept early on that we could be new tastemakers,” Zurrer said. “There was an opportunity for tastemaking with NFTs, just like she had done for African-American art.”

So the push to legitimize NFTs became a lot more respectable with powerful allies running the museums. Those traditionalists learned to ignore crazy ideas like a Brazilian Beeple penis the size of a three-story house, which never materialized, and focus on more palatable expressions of digital art like Anadol’s algorithmic experiments that meditated on the art historical canon inside MoMA.

Winkelmann was left feeling a little frustrated, although he still attended Anadol’s opening alongside Kimbal Musk and a hoard of new tech investors previously unknown to MoMA’s fundraising department. The artist had his own meetings with the museum’s trustees, but left those chats empty-handed. “More than anything, my work is about continual growth,” Winkelmann told me, explaining why he was done waiting for cultural institutions to recognize his work. “If they don’t care about shaping visual culture anymore, then that’s fine. People like me will shape visual culture because I’m reaching many more people, and it will be what it is.”

Zurrer remained steadfast about building his relationship with MoMA. Winkelmann’s big dick was never made. During one of our conversations, the venture capitalist said he was interested in donating his Anadol NFT to MoMA’s permanent collection. When I asked Kuo about the offer, she declined to discuss specifics. For the moment, she remained focused on the Anadol exhibition and the crowds of young people entering the museum to gaze deeply into the pixelated hurricane of colors.

“Refik is bending data—which we normally associate with rational systems—into a realm of surrealism and irrationality,” Kuo said. “His interpretation of MoMA’s data set is essentially a transformation of the history of modern art.”

LONDON, UNITED KINGDOM - FEBRUARY 15: Turkish media artist Refik Anadol poses in front of his art works as he makes a press preview for his solo exhibition "Echoes of the Earth: Living Archive" at the Serpentine Galleries in London, United Kingdom on February 15, 2024. Digital media artist Refik Anadol, producing audio-visual live performance, site-specific installation and parametric sculpture, uses an artificial intelligence model trained with visual data of coral reefs and rainforests in his first major institutional exhibition. (Photo by Rasid Necati Aslim/Anadolu via Getty Images)
Turkish media artist Refik Anadol poses in front of his art works at the press preview for his solo exhibition “Echoes of the Earth: Living Archive” at the Serpentine Galleries in London in February.
Anadolu via Getty Images

It had taken two years for a curator as powerful as Kuo to speak publicly in support of NFTs, but once she did there was little reason for others to resist the new technology. Refik Anadol: Unsupervised marked a watershed moment in the history of digital art when the speculative tremors of the NFT boom dissipated and the tokens were simply rebranded as “digital collectibles” no stranger than paintings and sculptures occupying MoMA’s galleries.

A simple change in the language and tenor of the NFT industry had opened the floodgates. The major museums that stayed silent about the blockchain bonanza were suddenly eager to talk.

“We have hit a critical point where the technology that’s available to artists has far outpaced what museums can offer in terms of resources. So we have to beef up,” Naomi Beckwith, deputy director and chief curator of the Guggenheim Museum told me in an interview for the New York Times. “If artists are working with technology, then we have to be able to hold it.”

Financial support from LG, the electronics company, had shifted priorities at the museum, which announced a new assistant curator for digital art and a $100,000 annual award for artists making “groundbreaking achievements in technology-based art.” Conservators were also exploring the possibility of uploading ownership records to the blockchain, which could help art historians researching the collection.

Around the same time, Tina Rivers Ryan was organizing the first survey of blockchain art by a major American institution. She had convinced the Buffalo AKG Art Museum to run the exhibition as an online auction called Peer to Peer, which would raise money for the museum. More than a dozen digital artists participated in the show, including Rhea Myers, LaTurbo Avedon, and Itzel Yard (known online as IX Shells).

Ryan was exceptionally careful to avoid using the NFT initialism when describing the exhibition, preferring to define its offerings as “digital artworks by artists who are engaged with blockchain technologies.” This awkward phrasing was an inelegant solution to an inconvenient problem. The curator needed to explain how she had gone from being one of the NFT market’s strongest critics to becoming a cheerleader for the crypto avant-garde that had earned her a platform and a promotion. She had attacked NFTs as turning all art into “frictionless commodities” and now talked about how these culture bombs should be placed near Picassos.

“I think a number of people in the NFT space have expressed relief over the market crashing because it allowed for different conversations,” Ryan reasoned, “including conversations that are a little more about the art and less about money.”

The entrance of the Buffalo AKG Art Museum.
The entrance of the Buffalo AKG Art Museum.
Photo by Marco Cappelletti, courtesy of the Buffalo AKG Art Museum

Nobody has ever celebrated losing so much money in such a short period of time as NFT collectors; however, the next best thing would be gaining cultural capital. Investors who once lambasted curators for being “cultural gatekeepers” were learning museumspeak through Ryan, who always packaged her blockchain projects through art history. She made NFTs sound like an inevitability, relaying how it took nearly a century after photography was invented for the artistic medium to receive its first museum exhibition in the United States. That 1910 show at the Albright Art Gallery was arranged to demonstrate that photography could be a visual form of artistic expression during an era when most people regarded cameras as documentary tools. So why wouldn’t the gallery, now called the Buffalo AKG Art Museum, host the first NFT exhibition?

“Digital art will arguably be central to the contemporary art story in the decades to come,” Ryan argued. “Digital technology is already one of the determining factors of contemporary life whether or not you even use it.”

And although it didn’t receive the fanfare like a big museum exhibition, there were other structural changes afoot that secured the position of NFTs within the art market.

Perhaps the most influential decision came from the Artists Rights Society, the industry’s de facto authority on copyright protection and licensing matters, with more than 122,000 members worldwide. The organization released its own NFT platform, Arsnl (pronounced arsenal), in September 2022 with a collection by the 86-year-old minimalist Frank Stella, called Geometries. The project gave collectors the right to 3D print the artist’s digital creations.

“NFTs are exciting,” Stella told journalists. “We can build in resale rights; that’s something we’ve worked, rather fruitlessly, on for decades. It will be wonderful if technology can give us what the government never would.”[iv]

The Artists Rights Society was sending a clear message to the industry that NFTs would be an important part of the art market in the future; meanwhile, artist estates were demonstrating that NFTs would also be an important part of remembering the past. Foundations representing deceased artists like Leonora Carrington and Alexander Calder released their own tokens, which provided a new revenue source for their cash-strapped operations. Other groups tapped talent within the NFT community to produce original works. The estate for László Moholy-Nagy even commissioned the generative artist Dmitri Cherniak to develop new works inspired by the Bauhaus master of machine experimentation.

The sale allowed Cherniak to flex his deep understanding of art history. “Tech people always appreciated my work because they understood the tools I was using to make it,” the artist said. “Others would think that it was boring, mundane, and robotic.” His Light Years project was devoted to Moholy-Nagy as a public plea that artists start taking ownership of technology.

“Tech is something we accept, but we don’t own culturally,” Cherniak explained. “It’s used as an economic and political tool. But if we could harness that power for creativity, the world could become a lot more interesting.”