Investing in art is as old as investing in gold or perhaps even older than that. Unlike Bullion, it’s a very niche market. Few people bother to even look at it mainly because of lack of knowledge and expertise in the art market. After all, a layman can’t really tell the difference between a 10$ and a 1,000,000$ painting.
Ask any successful investor not named Warren Buffett their secrets for minimizing risk, and they will tell you it’s diversification. Not putting all your eggs in one basket is essential for preserving both your wealth and your sanity.
Bitartshares offer a unique way to invest in art without having to spend millions of dollars on original art masterpieces. Furthermore, they only accept Bitcoin as the payment method.
Why only Bitcoin?
– World’s first Art investment platform that incorporates bitcoin.
– Supporting and accelerating crypto adoption movement.
– It is fast, easy, simple and secure.
– It can bypass a lot of archaic regulations that are imposed on the Art trading market that makes the process arduous, time consuming and simply difficult when fiat currency is involved.
Factors that make Bitartshares different from other Art investment Platforms?
High Profits: Bitartshares go for medium priced undervalued art. The problem with High priced “Masterpieces” that range in millions of dollars is that there is a very small Buyer’s market. It may take several years before finding a buyer who can pay the desired price. Low priced art is too volatile. It may give massive returns but is a lot riskier. Medium priced Art is just the sweet spot. This allows them to provide higher profits than any other platform.
Low fees: Bitcoin enables bitartshares to charge the lowest fee which is just 3% or 5 USD (whichever is greater) on withdrawals.
Low minimum investment: Investors can start with just 100$ in Bitcoins.
Short Hold period: Blue chip art investment is long term. The hold period ranges between several years. Bitartshares doesn’t invest in blue chip art. It makes the hold period as short as 30 days.
Who should use Bitartshares?
Currently, only bitcoin owners can use this platform. If you are a bitcoin hodler and plan on hedging the risk for at least a few months, this is the right platform for you.
The Complete Process
1. Bitartshares sources works of art from collectors, advisors, galleries and dealers and buys them with its own capital. Artworks are chosen based on certain investment criteria, including the artist’s collector base, the average appreciation rate, and demand for the artworks.
2. The artwork’s total value is then divided into equal shares that investors can buy. An investor cannot hold more than 100 shares of a single item.
3. Proceeds are divided among investors when the item is sold in the auction or a private collector buys the artwork.
4. Although it has never happened so far but If there’s no opportunity to sell or redeem your shares in an item after the hold period, Bitartshares provide 100% refund.
Bitartshares potential returns:
Based on the “History” which you can analyze in their website, the returns are usually in the range of 24% – 160% APY depending on the hold period.
|Hold Period||Profit Estimate|
|90 days||8%- 30%|
|180 days||30%- 70%|
|1 Year||80%- 160%|
Risks of Investing through Bitartshares:
Although bitartshares claim they never sell at a loss, we assessed certain risks.
– Bitartshares is a fairly new company with a short track record.
– Few options for buyers to choose from.
– Offerings by living artists could quickly devalue depending on an artist’s reputation, public sentiments on social media and so on.
– Art valuation can be highly subjective.
There are no reliable art market price indexes for measuring risk and returns. Typically within investing we rely on S&P 500, Dow Jones Industrial Average, and the Barclays U.S. Aggregate Bond Index to define the securities that make up an asset class.
It’s not possible to create an art index for a few reasons.
First, about half the art market’s annual sales ($63.7 billion in 2017) are off-limits to create an index, because they occur in the gallery market where public price disclosure is not required.
Second, the indexes researchers have built using repeat sales of artworks at auction, such as Sotheby’s Mei Moses, paint an incomplete picture of the market and the movement of prices over time.
Third, even if those indexes accurately captured the performance of the auction market as a whole, there is nothing in the real world you can buy to replicate that performance because each art piece is entirely different from the next.
Given the high potential reward, artworks certainly can have a place in your portfolio. It is no longer a market for the elite. Bitcoin has opened up this lucrative avenue to the general public. We are living in exciting times.
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