Auction house Sotheby’s is collaborating with Coinbase to accept cryptocurrencies as a payment method for a physical work of art.
The company said it will accept Bitcoin and Ether as payment when it auctions the Banksy painting, Love Is In The Air, later this month.
“This is the first time that cryptocurrency will be accepted as payment for physical artwork and we are really excited to make this happen. It’s something we’ve been thinking about for quite some time,” Sotheby’s chief executive Charles Stewart told CNBC’s Squawk Box.
“Banksy has been a very popular artist at auction and there is a lot of interest in his work paying with physical money as well. But what better combination to introduce crypto than with an iconic Banksy painting?”
Sotheby’s said the decision to accept cryptocurrency for physical payment followed on from the recent success of ‘The Fungible’ Collection – the sale of non-fungible tokens bestowing ownership of digital artworks from designer Pak, which saw bids from more than 3,000 collectors, most of whom were first-time buyers with the auction house.
Its decision to accept cryptocurrency via Coinbase Commerce, a method for businesses to handle crypto payments, “marks an important next step”, the auction house said in a statement.
The Banksy painting has an estimate of $3 million-$5m for the auction, which is due to take place next Wednesday, May 12. Bidders can also pay in cash, Mr Stewart said.
It will be up to the owner of the painting whether or not to keep the cryptocurrency or immediately convert it to US dollars, he added.
“I definitely think we will expand the audience by doing this and it’s something that we’ll explore going forward, although of course we’re very curious to see how this first step in that direction goes,” Mr Stewart said.
Bitcoin was trading 3.04 per cent lower at $55,975 on the Coinbase exchange at 5.30pm UAE time on Tuesday. Ether was up 13 per cent at $3,515.39.
“Coinbase is proud to provide Sotheby’s with a sophisticated payment solution, backed by our deep liquidity, and expertise with trading and hedging cryptocurrencies,” Sanchan Saxena, Coinbase’s vice president of product and ecosystem, said.
“This is an example of an enterprise that is evolving with their client base to cater to crypto-forward consumers.”