Blockchain Adoption in Art: Authenticity Provenance on the Ethereum Blockchain

Taiwan Auction House, celebrating its 10th anniversary this year, held a spring auction press conference on the 5th, where it announced a partnership with blockchain startup ITM (International Trust Machine). The collaboration will use blockchain technology to encrypt and store appraisal data for jewelry and art. By leveraging the public Ethereum blockchain and smart contracts, they will create an immutable identity provenance for each artwork. This move from traditional paper certificates to detailed blockchain records marks the first step toward building "trust" in the international art trading market

ITM's proprietary blockchain scaling technology allows for the on-chain storage of large quantities of art features. Because the provenance of these features cannot be tampered with once they are on the blockchain, future sales can be verified to confirm that the item is the same one sold by the Taiwan Auction House platform. When clients resell their assets, the blockchain record can serve as an irrefutable proof of origin. Clients can also use Tsang Yi's blockchain platform to verify the data at any time, protecting against fraud, such as data being altered, added, or removed.

In 2017, a well-known domestic jewelry brand, Jurassic Diamond, was targeted by an international theft ring. Despite several police officers being present, thieves stole seven pieces of jewelry worth a total of US$7.81 million in just five minutes, causing widespread shock. This theft was a heavy blow to Li Cheng-lun, Jurassic Diamond's General Manager and Taiwan Auction House's Chief Auctioneer.

The painful experience led him to consider how to provide better security for vendors, clients, and owners of valuable collectibles. He realized that even if jewelry or art pieces are stolen, there must be evidence of their original features and transaction history to prove ownership in domestic or international criminal proceedings when the items are altered or fenced.

The Chairwoman of Taiwan Auction House, Wu Sui-hua (伍穗華), stated that blockchain technology provides assurance for auctioned items. "With blockchain provenance, all valuable items are protected against tampering. This is a game-changer for the world of collecting and art, and I believe it will transform future transactions."

ITM's CEO, Chen Chou-jen, explained that public blockchains offer the highest level of trustworthiness. "We are now storing appraisal results on Ethereum. In the future, when Tsang Yi sells jewelry, the provenance will be given to the client. The client can then verify the authenticity of the data directly on the blockchain without needing a third party." He added that the industry previously avoided public blockchains due to high transaction speed and cost, but ITM's patented technology has solved these issues, enabling low-cost data storage and quick verification of provenance.

In the next phase, Taiwan Auction House will collaborate with the AI startup ArtRecord Co., Ltd. to use its patented technology to scan and identify original features of artworks and upload this data to the blockchain. This will enable clients to easily authenticate an artwork's genuineness using just their mobile phones.

Ms. Wu commented, "Taiwan has incredible technology; it's about how we apply it. If we can make this technology more widely known, it will undoubtedly bring about a huge change in this industry."

5/15 (Sat): Contemporary and Modern Art Auction at Hua Nan Financial Holdings

5/16 (Sun): Dazzling Jewels Auction at Hua Nan Financial Holdings

Time: Viewing begins at 11:00 AM, and the event starts at 2:00 PM.

Address: 3F, No. 123, Songren Rd., Xinyi Dist., Taipei City (Hua Nan Bank Headquarters).