Fairs and Auctions Going Digital: How to Keep Transactions Secure

By SaBreigha Dixon.

On November 17, 2020, Art Basel announced postponement of its 2021 Hong Kong live edition, a further blow after the cancellation of its Miami and Switzerland annual fairs. Yet, Art Basel is adapting through Online Virtual Rooms: Miami Beach, with pricing rates much lower than that of the in-person event.^[1] The decision is unsurprising as more and more art auction houses and fairs continue to get pushed back shows due to COVID-19 travel restrictions. Against that backdrop, the art trade has been increasingly international, thanks to the digital advancements, wire transfer payments and general ease of travel. Top art collectors tend to be cosmopolitan with real and tangible property spread around the world, using freeports for storing their collections in favorable jurisdictions for the tax benefits.^[2]

In light of the current state of the world, and dealing with the effects of the COVID-19 global pandemic, the art world has been faced with a major dilemma – how does it continue to keep transactions and auctions secure? With much of the world still on lockdown, like many other industries and platforms, the art world has been forced to move online and conduct its business in virtual spaces. With that move has come a host of problems and fears regarding how customers’ data, privacy, and security will be protected.

While the demand is still there, buying high-value art has always been considered a risky venture. Around twenty-five to fifty percent of works currently circulated in the market are fakes, forgeries, misattributions and unknowns.^[3] And although high-value art typically goes through a rigorous research and appraisal process to be authenticated, studies show that about one out of ten artworks held in museums are deemed to be fake.^[4] So how then, can purchasers buy with confidence while not only being unable to see artworks in person beforehand, but also now being required to provide all their personal information and payments through online auction websites?