Imagine this: a young artist in rural Cambodia, struggling to make ends meet, finally able to sell her intricate silk paintings directly to collectors in New York, bypassing gallery commissions and predatory middlemen. That’s the promise El Salvador’s crypto experiment has opened up. It’s not just about Bitcoin, but to really give life to the forgotten voices of the global creative economy.
The SEC is currently negotiating a cross-border “regulatory sandbox” with El Salvador. Together with pilot programs incorporating tokenized assets, this has the potential to be a major step in that direction. Sure, at less than $10,000 each, these pilots sound like a drop in the ocean. As different as they all are, they each represent a sea change from traditional regulation and its negative externality on emerging markets.
Tokenization: Leveling the Playing Field
Let's be clear: the current art world is rigged. Galleries take huge cuts, access is limited to the wealthy elite, and countless talented artists are left in the shadows. Tokenization, in this case, fractional ownership of art, changes the game.
Imagine it like traditional crowdfunding meets fine art. An artist could then tokenize a physical painting, dividing its ownership into thousands of digital shares. A person with $50 can be an investor in — and patron of — the artist she’s most passionate about. This opens up the field of art investment to everyone and allows artists to connect more easily with their supporters.
El Salvador’s experience, especially tokenizing real estate, shows that this model is possible. Using it on art is just a logical next step. An American real estate broker teaming up with an El Salvador based tokenization company to sell fractionalized property ownership via tokens on a blockchain? Picture that same approach being applied to art from Southeast Asia! The possibilities are mind-blowing.
SEC, Stop Stifling Innovation
The SEC’s approach to trading and investing in crypto has often looked more like whiplashing the drivers on a Formula 1 course. Investor protection should be a core principle. The agency’s approach—a deliberate, risk-averse, and foot-dragging approach—will actually kill innovation and hold back the communities that it wants to empower.
The SEC may be afraid of the unknown. That’s precisely why they should step in and start the education process themselves.
While we’re glad to see mention of cross-border sandboxes by Commissioner Hester Peirce, this falls far short of what is needed. The SEC needs to proactively create pathways for artists and creators in emerging markets to access the benefits of blockchain technology.
The SEC’s non-delegable mandate is to protect investors, but who the hell is protecting innovation. What about creating more economic opportunity for those who need it the most? The agency needs to look at things differently. Instead, it should acknowledge and embrace crypto as a widespread tool for financial inclusion, not simply a new weapon of mass destruction.
Artists Unite, Embrace the Future
This isn’t regulatory burden, this is regulatory empowering. This goes far beyond policy. Artists in Southeast Asia and beyond, I urge you: embrace crypto. Explore tokenization. Learn about NFTs. Demand access to these technologies.
Don't wait for permission. Create your own platforms. Build your own communities. The power is in your hands.
Ultimately, the El Salvador experiment is a victory for artists. It exemplifies how crypto allows us to go around traditional gatekeepers and unlock economic opportunities for everyone. It's a wake-up call for the SEC because it highlights the agency's need to adapt and embrace innovation, rather than stifling it.
We need to foster an environment where artists like the woman in Cambodia can thrive, where their voices can be heard, and where their art can be appreciated by a global audience. This goes far beyond art, this is about justice, equality and the power of technology to change so many lives for the better. It's time to act.
