Following the merger with Auctionata in May 2016, and after the online auction house filed for insolvency in July 2017, Paddle8 has announced its next step: the New York-based company will merge with the Swiss tech company The Native, specializing in e-commerce.
The move was largely influenced by Paddle8 advisors and cryptocurrency pioneers Cameron and Tyler Winklevoss, who have advised the two companies to focus on blockchain technology for the launch of Paddle8 Lab. On August 18, the first sale of artworks and luxury goods where buyers will be able to pay with cryptocurrencies will be organized by the two companies on the 10-year anniversary of the launch of bitcoin.
In a statement, Paddle8 clarified that “The Native will buy a 15 percent stake in Paddle8 for 8.5 million Swiss francs, or $8.8 million. The Native will also have an option to buy an additional 36 percent of Paddle8 for 24.5 million Swiss francs, giving it a majority stake.”
High-profile investors including Damien Hirst, David Zwirner and Jay Jopling have contributed to pumping $44 million into the digital auction house.
Sergey Skaterschikov, The Native’s chairman, said he saw the benefits of applying blockchain technology (essentially an online ledger of transactions) to the art world. “A lot of the art trade is built on asymmetric information,” he said. “It was scaring a lot of potential buyers from the collectible market.” Cameron Winklevoss added in a statement: “We’ve long considered cryptocurrency as key to increasing transparency in markets around the world, including the art market.”