Sotheby’s announced Tuesday that it will accept bitcoin and ether in Banksy’s upcoming “Love is in The Air” auction.
It is the first time that a large auction house accepts both cryptocurrencies as expenses for a piece of art, according to Sotheby’s.
“The combination to introduce crypto is better than the iconic Banksy painting,” Sotheby’s CEO Charles Stewart said Tuesday on CNBC’s “Squawk Box”;.
Sotheby’s recent entry into the world of digital assets is going through a partnership with cryptocurrency exchange Coinbase, which went public in April. Sotheby’s first race came last month when auction houses sold the Irresistible Token, or NFT, created by digital artist Pak.
Banksy’s “Love is in The Air” is one of the most recognizable works by an unknown British street artist. The auction took place May 12, Stewart said bids were between $ 3 million and $ 5 million.
Gallery Assistant Tune “Love is in the Air” by British graffiti artist Banksy prior to its release in London on June 24, 2013.
Justin Tallis | AFP | Getty Images
“Probably the winner of this drawing was paid in dollars, not crypto. But I think for us it was interesting to make the possibilities for this, ”Stewart said.“ There’s a huge audience interested in the aesthetics and possibilities of the NFT there. Physically, too, it’s interesting to see. “
In Pak’s three-day NFT sale, Stewart said Sotheby’s had more than 3,000 buyers.In total, the collection sold for $ 16.8 million. “We are seeing a very large and very new audience from Sotheby’s point of view,” Stewart said.
In March, Christie’s became the first major auction house to sell NFT, a blockchain-based asset uniquely designed by digital artist Beeple for nearly $ 70 million. For that Beeple auction
Bitcoin is the world’s largest digital currency by market capitalization at over $ 1 trillion as of Tuesday morning, according to CoinMarketCap.com Ether, which operates on the Ethereum blockchain network, is the second-largest cryptocurrency with a market capitalization of more than $ 400 billion.
If the winning bidder pays for a Bansky drawing with bitcoin or ether, CNBC’s Andrew Ross Sorkin asks if Sotheby plans to hold the cryptocurrency or convert it to US dollars immediately.
“We have an agreement with the painting owners, the suppliers of the paintings, so it’s ultimately up to them,” Stewart replied. But there are also possibilities “
Tuesday’s announcement from Sotheby’s, founded in 1744, demonstrated the acceptance of an additional institution for cryptocurrencies
Earlier this year, Mastercard said it would begin providing support for certain cryptocurrencies in its network, while Morgan Stanley and Goldman Sachs, the main Wall Street banks, had taken steps to keep clients in check. Get their wealth of bitcoin
Other companies such as Tesla and Square have bought bitcoin to hold on to their balance sheet.Tesla is also beginning to accept bitcoin as a charge for electric cars.
Using bitcoin to make purchases has significant tax implications due to the classification with the Internal Revenue Service.
The IRS considers bitcoin assets, so spending bitcoin is seen as being sold on it. This means that individuals paying for goods or services in bitcoin may be subject to capital gains tax at the point of ownership transfer if the bitcoin’s value is higher than the original acquisition.
Bitcoin traded below $ 56,000 per token on Tuesday, bringing in more than 90 percent of its profits since last year, according to Coindesk data.Ether was trading below $ 3,500 on Tuesday, slightly below its all-time high. That arrived earlier today Ether has increased by more than 360% in 2021.