From Canvas to Crypto: What “Tokenising” Your Art Really Means

From Canvas to Crypto: What “Tokenising” Your Art Really Means

A super‑simple guide for Australian artists who are used to galleries, not blockchains

Most Australian artists still start out the same way: you paint a canvas, you carry it to a gallery, and you hope it finds a home. The gallery hangs it, talks to collectors, and if you are lucky, a buyer falls in love and pays the price. The gallery takes its commission, you get your share, and the buyer walks away with the painting under their arm. From that moment on, the money side is basically over for you. If that painting is later resold for ten times the price, you may hear about it, but you usually do not see any of that extra money.

Now imagine a slightly different story. You still paint the same canvas. You still sell it once. But instead of that being the end of the money trail, the artwork becomes the base for a new digital market around it.

Here, the buyer (often a platform) keeps the physical painting safe in storage, and then creates digital “tokens” on a blockchain that are linked to your work. These tokens can be bought and sold online, sometimes all over the world. Each token might represent a slice of the artwork’s value, or some other right tied to it, and people can trade those slices without ever touching the actual canvas.

This can come up for any Australian artist – we have had clients who have had art platforms emailed them that they want to buy some of artworks, “tokenise” them, and share future profits with you. The offer has global reach, digital collectors, and royalties every time a token is resold.

No longer are you limited to selling a single canvas once and then watching, from a distance, as it climbs in value in someone else’s hands.

Another scenario is when the collector wants to buy your hero painting, lock it away in secure storage, and then sell digital “shares” in it to their followers.

You’re told you’ll get an upfront fee plus a cut every time those shares trade. It feels like a new way to make your art work harder for you – and in some cases, it can be. But it also introduces contracts, platforms and laws that most artists have never had to deal with before.

Tokenised art really can open doors. But it can also slam them shut if the agreements are badly written or one‑sided.

That’s where careful legal work comes in.

What is tokenised art, in artist‑speak?

Tokenised art is basically this:

1. You create an artwork – a painting, print, sculpture or digital piece.
2. Your work is linked to a digital token that lives on a blockchain (a shared online record that tracks who owns each token and every trade in a way that is very hard to secretly change).
3. That token is what people buy and sell online. It might represent one whole work, or a small slice of the “deal” around it.

Collectors buying the token are usually not getting the canvas to hang above their couch.

They are buying a digital asset tied to your work’s value, story or community. Sometimes that token also comes with special rights, like access to private drops, events or a share of future profits if the platform sets it up that way.

For you as the artist, the big shift is this: instead of “sell once, get paid once”, a token deal can be written so that you get:

1. a first payment for the physical work (like a normal sale); and
2. a slice every time the token is resold.
3. If your work becomes popular and the tokens are actively traded, that can turn into real, ongoing income – something the usual gallery model struggles to deliver.

How tokens, blockchain and “slices” actually work

Think of blockchain like a big public gallery record for digital things. Every time a token is made or traded, a new line is added to that record showing who owns it and when it changed hands. Copies of this record sit on lots of computers at the same time, which makes it very hard for anyone to secretly edit it or fake a sale. So when people say your token is “on the blockchain”, they mean its whole history – who created it, who owns it now, and each trade – is locked into that shared record in a way that’s very hard to mess with.

Sometimes the artwork is broken up on paper, not in real life – the canvas stays whole, it’s just the deal around it that’s sliced up.

They might make 100 tokens for one painting, and each token is just “1/100th of the deal”. It doesn’t matter which token you get; they’re all equal. Put another way, it’s like owning 1 share out of 100 shares in a company – you don’t own a specific brick in the building, you own a small slice of the whole thing.

In this tokenised world, buyers are not really paying to hang the painting on their wall.

They are paying for a digital asset that sits on a blockchain and is connected to your art.

Sometimes that token stands for a small economic interest (they hope to sell it later for more). Sometimes it brings perks like access to special events or online communities. Sometimes it is simply a way to say “I own a piece of this story”. The important part is that the token and the painting are not the same thing, and a good contract must say exactly what the token does and does not give.

On the surface, a token deal can look like just another contract to sign quickly so you can get back to painting. Underneath, it’s much more complicated. These agreements often have to juggle:

1. what the token actually means (and what it doesn’t);
2. who owns the physical artwork, and who is responsible if it’s damaged or lost;
3. how royalties are calculated, tracked and enforced over time;
4. how your images and name can be used in marketing, if at all;
5. how all of this sits with financial and consumer laws that weren’t written with artists mind.

If all the above details – and more – are not nailed down, lots of things can go wrong.

You can end up with vague promises of royalties that never show up, artwork used in contexts that you don’t agree to, or even being treated as if you were part of an “investment scheme” you never meant to offer and that’s just the start of it.

Is it a financial product?

There are also legal questions about what the token itself really is.

Splitting an artwork into many “shares” and selling them can make a token look a lot like a financial product in the eyes of regulators. If it is treated like an investment or a type of security, the platform may need licences, disclosures and investor protections. If the agreement and the marketing are sloppy, it can even look as if the artist is the one offering that investment, which is not a position most artists want to be in.

Part of the job when drafting these agreements is to make it clear that token buyers have rights against the platform, not against you.

In that context, our job as lawyers is to make sure that you are not the issuer or promoter of a financial product.

Royalties, IP and the “boring” details that really matter

By now you will be getting the picture that for artists, the exciting part is that this can turn a one‑off payment into a longer‑term income stream.

Further, in a well‑written agreement, you still sell the physical work, but you also get a share every time the tokens are resold.

For example, the contract might say you receive 20–30% of each future token resale price. Instead of being shut out of the secondary market, you are now plugged into it. If your work becomes popular and the tokens start trading often, you may keep earning long after the first gallery‑style sale would have ended your involvement.

Of course, this promise will only work if both the technology and the paperwork line up.

On the tech side, the royalty needs to be built into the token system or backed by a solid reporting and payment process. On the legal side, the agreement needs to clearly state a whole bunch of things especially about royalites and getting them on every resale.

Then there also is the old question artists know well: who owns what?

Even in this new model, we like to ensure that artists keep their copyright unless they want to sign it away. A careful token agreement will say that you keep all intellectual property rights and only grant a narrow licence for specific things, like showing the work on the platform, in catalogues or in press coverage. It should also protect your reputation by stopping your work and your name being used in “get rich quick” advertising or shown alongside material you find offensive.

The physical side of the story also matters.

Someone has to look after the canvas. The contract should say who is responsible for storage, insurance and condition reports, and what happens if the artwork is damaged or destroyed while the platform is holding it. Those details are not just boring fine print; they decide whether you have any say if the worst happens.

What do these agreements usually cover – and why you shouldn’t DIY

A typical token or “real‑world asset” (RWA) agreement for an artist need to cover many issues – too many to go through in this blog. It’s a lot and it’s very different to the simple, one‑page consignment forms many artists are used to. “Don’t try this at home” isn’t usually legal advice, but with tokenised art, it comes close.

These deals sit where art, contracts, IP and financial rules all collide. The language is new, the platforms move fast, and even experienced lawyers can find it challenging.

Trying to cut and paste your way through a token agreement, or signing something you don’t fully understand because “everyone’s doing it”, can leave you with problems such as:

• no real right to chase missing royalties;
• weak or non‑existent control over how your images and name are used;
• unexpected responsibilities if regulators or token buyers start asking questions;
• no clear plan for what happens if the artwork is damaged, the platform collapses, or the project quietly disappears.

How we can help you

You should not need a finance degree to decide if a token deal is good for you. What you do need is a clear, fair agreement. A lawyer who understands both art and digital assets can:

Translate the offer into plain language.
Explain: what happens to your canvas, what money you get now, what money you might get later, and what you are promising in return.

Check or draft the agreement.
Make sure it clearly says:

• you keep your copyright unless you agree otherwise;
• how your images and name can be used;
• exactly what rights token buyers have (and do not have) against you;
• how royalties are calculated, paid and recorded;
• who is responsible for insurance, storage and damage.

How Sharon Givoni Consulting can help artists

At Sharon Givoni Consulting, we can assist you to navigate exactly these kinds of new, messy spaces without losing what matters most: their rights, their reputation and their income.

For tokenised art and RWA deals, help can include:

1. Explaining the offer in plain English
   Walking you through what the platform is really proposing: what happens to your artwork, how the tokens work in practice, what you earn now and later, and what risks you’re actually taking on.
2. Reviewing and fixing the agreement
   Going through the draft contract line by line, spotting gaps and one‑sided clauses, and suggesting changes so your rights and royalties are properly protected.
3. Protecting your IP and moral rights
   Making sure you keep ownership of your work unless you clearly choose otherwise, that any licence is narrow and sensible, and that your art and name can’t be dragged into marketing or contexts that harm your reputation.
4. Negotiating with the platform for you
   Talking to the platform’s team (or their lawyers), pushing for fairer terms, clearer royalty and reporting clauses, stronger protections around storage and insurance, and more realistic risk‑sharing.
5. Advising if things go wrong
   If a platform underpays, misuses your work, or drifts away from what was agreed, helping you understand your options and decide what to do next.

Old gallery model vs tokenisation, in one glance:

Gallery model = one canvas, one buyer, gallery commission, one main payment for you.

Token model = canvas + digital tokens; you can get a first payment plus a slice of later trades, if the contract and code are done right.

Sum up

Tokenisation can be a powerful extra tool for artists. But like any tool, it can hurt if used the wrong way. Before you sign any token or “RWA” (real‑world asset) deal, get a lawyer who understands both art and law to look over it. That way you keep doing what you do best – making art – while knowing the money and legal side are properly looked after.

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Please note the above article is general in nature and does not constitute legal advice.

Please email us info@iplegal.com.au if you need legal advice about your brand or another legal matter in this area generally.