As Argentina continues to take the lead in crypto in Latin America with respect to the rest of the region, the development of the non-fungible tokens (NFTs) industry is diversifying, increasing the flow between creators, artists and collectors.
Forming part of this circuit is Kephi Gallery, which as its name suggests is an NFT gallery launched two years ago by four friends, Joaquín Cochero, Nicolás Verderosa, Germán Trautman and Nicolás Albarellos, and which was born out of their shared interest in finance and art.
At that time, the price of Etherum (XET) was on the rise, which gave them the opportunity to create a low-fee, affordable exchange so that any creator could make their work into an NFT.
Verderosa recalls those beginnings, from calling on his friend Joaquín, to putting together the rest of the team. And all of that took place in the midst of the pandemic, and with no contact than virtual. “The team emerged in the pandemic and we never actually met until last year. We saw each other in person at the launch of the platform,” Verderosa says, almost without being able to believe all that they have achieved during the lockdowns.
As Verderosa had already been in the world of finance since 2017, having worked at an exchange in Vietnam, he began to shape the crypto gallery, having Asian markets as one of his allies.
Having set up a first model of Kephi, the four developers presented themselves to an accelerator program, and which made them its first pick, allowing them to obtain some financial support, and which although was not very large, gave them the necessary impetus to go out and look for investors.
With around 30 investors, they managed to raise $100,000, and which allowed them to continue with the development and a subsequent public sale to raise another $100,000. But, to their astonishment, they raised some $6 million in the space of two hours, with an 1,800% oversubscription. But despite that, they only kept the money that they needed.
“That gave us the push we needed to move forward with the final development as soon as possible, and by the end of November 2021 we would be out in the world,” says Verderosa.
Art a la carte
In Kephi Gallery, users can create their own NFTs and then exhibit and sell them. Its main differential is its fees, which start at $1.50 to create a massive work of one’s own, with several copies. This value contrasts with the $100 charged by other platforms. Kephi operates with Binance Smart Chain and KardiaChain, which allows it to maintain its low prices.
For their part, the creator of the NFT will always be entitled to receive royalties from the market, even after the sale of their work.
Today, the platform has a total of 1,500 artists onboard and more than 2,500 works created, both unique and copies, while the buyers are mostly foreign investors, since the platforms have lot of exposure in the Asian market, which has a very mature NFT scene.
“Most of the collectors who buy are from Southeast Asia, and the artists are from Latin America,” Verderosa says. “In that way, we don’t remain only in the exhibition of artists at a local level, and although one aims at the Latin American market, today we can provide them with greater exhibition.”
The preeminence of the Asian market also has to do with the fact that the local market is still very immature in terms of NFT, because the Argentine public uses crypto as a means of savings, and there is still a lot of lack of belief in this type of instrument.
Eighty-five percent of the artists in the gallery are Latin American, while the remaining 15% are from Asia, Europe and Australia. Artistically, there is a great variety of styles, from animation and photography to 2D, 3D and pencil art, among many others.
“These artists are not known worldwide, although they have their mass of followers,” Verderosa says, adding that, in the short term, “we aim to involve well-known artists in the platform”.
The business model of the four entrepreneurs is based on obtaining a profit on the creation of the work, which can be up to 5% if the work is sold. “Our profit is low, but we aim for volume, so that it is sustainable over time,” Verderosa says.
Based on this, the projections for the end of the year are auspicious, as they have recently been invoicing around $30,000 per week. “It is not exponential, but it is growing. The market in general is going to be more stagnant, because the crypto market has suffered a lot”, he says, adding that the gallery is already thinking about a physical gallery where artists can show their works in augmented reality, while people with their smartphones can get their hands on the works of art.
The works currently have a value of between $20 and $20,000.
Translated from the Spanish by Adam Critchley