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Do famous paintings/artworks count as securities? Some people like to invest in them, and there are lots of “fintech”s offering fine art investment as a service

josefritzishere 2y ago
This has been argued. It's really interesting actually. https://dilendorf.com/resources/can-a-piece-of-physical-art-be-a-security.html https://dilendorf.com/resources/can-a-piece-of-physical-art-...
jameshart 2y ago
A painting is clearly a tangible piece of property, so it’s not really analogous.
- grzracz 2y ago
  How is digital art worth less than real world art? Are you buying the canvas or what it represents?
  - cushpush 2y ago
    Canvas.
  - jameshart 2y ago
    If you buy a painting, yes, you own the canvas. You can put it wherever you like, rent it out to others, destroy it, dismantle it and cut up the pieces to make your own collage artwork, whatever you like. The copyright in the work belongs to the artist though. Your physical ownership of the painting doesn’t stop the artist making another work just like it or licensing the right to do so to someone else. Museums and galleries sometimes claim copyright on images of works they possess, but that’s generally claiming a copyright over that particular photograph of the work, not the work itself. In order to do things like sell prints they will have to license the work from the artist or the current rights holder (for distributing prints of that work in that territory, which might not be the same as the rights holder for other uses). Ownership of ‘what the painting represents’ isn’t really something the law takes much of a position on.
- pxeger1 2y ago
  Stocks used to be owned by whoever owned the physical share certificate. I think the difference is more that paintings still have some intrinsic value (though only aesthetic) even if other people don’t think they’re valuable.
  - jameshart 2y ago
    Right, the value in holding the stock certificate is that it provides the bearer with entitlements to control and a share of the assets of an intangible thing - a company. The value in holding a painting is that you own some aesthetically arranged atoms.
    - shalmanese 2y ago
      But there's art that exists in freeports whose only value is that it's moved from locker A to locker B as a part of a financial transaction. Definitely, not all art is a security but it's an interesting question, both philosophically and legally whether there can be some class of art that functions so close to a security that security provisions should apply.
- yieldcrv 2y ago
  a painting can be sold in a securities transaction, hence "a security" and those aforementioned fintech firms are selling them to accredited investors, to reduce the compliance burden of conforming it to the reporting requirements of publicly traded stocks.
  - eurleif 2y ago
    A REIT is a security, but a house isn't.
    - yieldcrv 2y ago
      transactions are securities, assets are not we’re agreeing
throw0101d 2y ago
> Do famous paintings/artworks count as securities? Some people like to invest in them […] Just because you can invest in something does not mean it is a security: it can be a commodity. * https://www.investopedia.com/terms/c/commodity.asp https://www.investopedia.com/terms/c/commodity.asp * https://www.investopedia.com/commodity-vs-security-7509422 https://www.investopedia.com/commodity-vs-security-7509422 * https://www.findlaw.com/consumer/securities-law/securities-vs-commodities.html https://www.findlaw.com/consumer/securities-law/securities-v...

josefritzishere 2y ago

This has been argued. It's really interesting actually. https://dilendorf.com/resources/can-a-piece-of-physical-art-be-a-security.html https://dilendorf.com/resources/can-a-piece-of-physical-art-...

jameshart 2y ago

A painting is clearly a tangible piece of property, so it’s not really analogous.

grzracz 2y ago
How is digital art worth less than real world art? Are you buying the canvas or what it represents?
- cushpush 2y ago
  Canvas.
- jameshart 2y ago
  If you buy a painting, yes, you own the canvas. You can put it wherever you like, rent it out to others, destroy it, dismantle it and cut up the pieces to make your own collage artwork, whatever you like. The copyright in the work belongs to the artist though. Your physical ownership of the painting doesn’t stop the artist making another work just like it or licensing the right to do so to someone else. Museums and galleries sometimes claim copyright on images of works they possess, but that’s generally claiming a copyright over that particular photograph of the work, not the work itself. In order to do things like sell prints they will have to license the work from the artist or the current rights holder (for distributing prints of that work in that territory, which might not be the same as the rights holder for other uses). Ownership of ‘what the painting represents’ isn’t really something the law takes much of a position on.
pxeger1 2y ago
Stocks used to be owned by whoever owned the physical share certificate. I think the difference is more that paintings still have some intrinsic value (though only aesthetic) even if other people don’t think they’re valuable.
- jameshart 2y ago
  Right, the value in holding the stock certificate is that it provides the bearer with entitlements to control and a share of the assets of an intangible thing - a company. The value in holding a painting is that you own some aesthetically arranged atoms.
  - shalmanese 2y ago
    But there's art that exists in freeports whose only value is that it's moved from locker A to locker B as a part of a financial transaction. Definitely, not all art is a security but it's an interesting question, both philosophically and legally whether there can be some class of art that functions so close to a security that security provisions should apply.
yieldcrv 2y ago
a painting can be sold in a securities transaction, hence "a security" and those aforementioned fintech firms are selling them to accredited investors, to reduce the compliance burden of conforming it to the reporting requirements of publicly traded stocks.
- eurleif 2y ago
  A REIT is a security, but a house isn't.
  - yieldcrv 2y ago
    transactions are securities, assets are not we’re agreeing

throw0101d 2y ago

> Do famous paintings/artworks count as securities? Some people like to invest in them […] Just because you can invest in something does not mean it is a security: it can be a commodity. * https://www.investopedia.com/terms/c/commodity.asp https://www.investopedia.com/terms/c/commodity.asp * https://www.investopedia.com/commodity-vs-security-7509422 https://www.investopedia.com/commodity-vs-security-7509422 * https://www.findlaw.com/consumer/securities-law/securities-vs-commodities.html https://www.findlaw.com/consumer/securities-law/securities-v...