In defense of web3: A weekend on mushrooms with a whale art collector

It’s Friday afternoon at Customs and Immigration in the Monterrey, Mexico airport. Metal fans atop prefab walls recirculate a mushy ball of hot breath as dozens of travelers line up to use a single pen. One by one, we’ll discover it’s empty.

I tell the immigration officer that I’m here on vacation, which is a lie, before walking with photographer Nain Leon to the private car that awaits us outside. The chauffeur, Carlos, puts an address in San Pedro Garza García – the richest municipality in all Latin America – into Waze and offers us a beer from a Rubbermaid cooler. I decline. I’m saving myself for the hallucinogens.

For many, the cryptoart movement can be seen as a prototype: If blockchain can circumvent closed-door cronyism by decentralizing art markets, perhaps there’s a model here for undermining complexer forms of financial corruption. If NFTs can revolutionize art, could Bitcoin overthrow fiat?

Certainly, cryptoart has succeeded in undermining traditional art world gatekeepers. And now DAOs (including SuperRare) are pioneering new forms of community governance that, if all goes well, could lead the way for disruption of governance structures far broader in reach than tech platforms and investment funds.

And yet, for all the talk of decentralization, things still seem pretty centralized. As of last year, 80 percent of NFTs were owned by nine percent of collectors and 95 percent of Bitcoin was held by two percent of accounts. Amid major DAOs, as of July, less than one percent of members held 90% of voting power. 

Is Web3 really creating a more equitable world, or just another playground for the rich?

“You should talk to Gabe,” said Casey Coyle, SuperRare Labs’ Collector Programs Manager, when, with this question in mind, I expressed a desire to profile a “whale” art collector – a term used to describe individuals holding a large amount of crypto assets and artworks. “He lives in Mexico, and loves to talk about art.”

“And he eats a lot of mushrooms,” he added.

So here I am: staring out Carlos’ window at the exhaust fume-coated walls of this corruption-fraught industrial city. If Monterrey were an American Baby Boomer, it would love Ronald Reagan. Here, wealth follows geographic contours; rising through dense smog on the backs of slum-dwelling factory workers past white collars toiling in tall buildings to the streets of San Pedro Garza García, where Lululemon-adorned joggers suck air so fresh it borders on sweet. 

I’m reminded of Aspen or Vail – a place where the rich come to play – and I’m wishing I’d drank that beer.

It’s 7PM before Nain and I have dropped our bags at the hotel and walked across the street to meet Gabriel Santos Elizondo, or Gabe, at an upscale Japanese restaurant. Clean shaven and fit in an Astros cap, large silver watch, and denim coat, Gabriel is dressed like a baseball fan who can afford box seats. He sits alone in the amber glow of the back patio and greets us with enthusiasm.

Wealth is on display all around us, and the cuisine is no exception. Gabriel orders for the table. He speaks with a passion for cryptoart while, at moments, pausing to admire our surroundings. He’ll point out the beauty of the interior design, or of the women.

It becomes clear that this restaurant, this table, these beautiful patrons: They’re no coincidence. Gabriel has curated this experience. I come to think he curates most experiences. I see a man cultivating an evolving aesthetic, like a photographer forever composing the frame of his mind’s eye. Our waiter brings a bottle of sparkling water and Gabriel requests another with a more minimalist label.

“Much better,” he says.

He has with him a small green box labeled with a serpent eating its tail. Inside is a block of psychedelic mushroom-infused chocolate. We all indulge.

Soon sweat pours. Laughter deepens. We discuss collecting art that speaks to Gabriel visually and viscerally, and how mushrooms can open up those connections. Lines of symmetry become apparent in our surroundings. I see beauty in the negative space. The color spectrum unfolds like a peacock. It bends in the low light.

Gabriel speaks of community-building, and his passion for the “rising tide lifts all ships” cryptoart ethos. Yet, he admits, beneath such warmth there is the hunger of a shrewd businessman – a snarl he fights to stifle, or perhaps to hide.

We eat more chocolates.

Gabriel pays the bill and we get in his Porsche Cayenne. It smells fantastic. Passing through San Pedro’s richest neighborhood, Colonia Del Valle, we arrive at a 25 acre private residence on the neighborhood’s edge where he and much of his family have long lived.

The gates open and we drive past fashionably-lit mansions beneath a lush canopy. Gabriel’s mother lives here. She too is an art collector, with the likes of Frida Kahlo having basked her walls.

Inside Gabriel’s grand mansion, we sit surrounded by large physical artworks, squinting at his cryptoart collection on a 13” Macbook.

Gabriel lays out his art collection strategy. He starts by building relationships and lending advice. If the artist seems like a fit, he’ll offer his guidance, connections, and economic might: tools that open doors at platforms like SuperRare and drive value in the market. In exchange, he wants art for his collection – a seat at the table – and, perhaps, a cut of the artist’s sales.

Hours later at the hotel, Nain and I will admit to both being too afraid to dry our hands with the bathroom’s disposable embroidered towels.

The arrival of whale collectors to the cryptoart scene represented a new phase, an all but unacknowledged evolution shrouded by the money that came with it.

In the early days of 2018, cryptoart was an outpost for outcasts. It was a space where hungry artists (particularly digital artists) who’d struggled to find recognition from the traditional art world saw hope, where technologists obsessed over the possibilities in digital asset ownership, and anarchists saw a prototype for undermining power structures through crypto. There was a focus on building community as much as on selling art. Crypto’s promise had found a proving ground: If web3 could render art world bureaucrats obsolete, could blockchain tackle bigger structures?

Then came the money.

Speculators, whales and overpriced collectibles swarmed the space. Artists became millionaires. Few stopped to think that, besides JPEGs, what money bought was power. As whales’ motives came to shape markets, cryptoart risked recreating the very problem it had intended to eradicate.

Like police arresting a Mexican cartel boss, had cryptoart created a vacancy instead of a solution?

Today, the market is highly competitive. Often, young artists desperate to connect with high end collectors look for guidance or representation. They look for someone to put them on a collector’s (or a platform’s) radar – someone like a gallerist.

“I’m a businessman and I think of artists as business partners,” Gabriel told Nain and I. “Jake Fried, Mr. Misang, those are big fucking companies. Just being around watching, just being able to make suggestions, it is like I’m on the board of a Fortune 500 company and they are asking for my input. They’re that important to me. I’m strategic with my investments, but I’m investing in what I love.”

In the morning, Gabriel, Nain and I dine at San Pedro Garza García’s prestigious and exclusive golf club. The fruit is incredibly fresh, but I can feel the well-dressed men at the table behind us staring at my mullet.

Gabriel’s grandfather, Alberto Santos Gonzalez, played a central role in founding this club, and all of San Pedro. And though Gabriel can be sparse on family history details (preferring to not dwell in the past), depending on who you ask, the businessmen of Alberto’s era were either essential to Monterrey’s 20th century growth or liable for all that went wrong. Most likely, neither opinion is entirely correct.

A descendant of the De la Garza Falcón family that helped colonize Northeastern Mexico, Alberto was 20 years old when, in 1921, he and two brothers parlayed inherited wealth into a pasta company they’d soon transform into Mexico’s largest cookie manufacturer, Gamesa.

As Gamesa’s president, in the early 1940s Alberto was commissioned to find land for an exclusive golf club. According to an article by University of Nuevo Leon philosophy professor Lylia Palacios, Alberto recommended the (then) fertile farmers’ orchards of San Pedro Garza García and, soon after, began buying out farmers with his brothers’ assistance, accruing a thousand acres abutting the proposed golf course’s west.

“I had to make purchases stealthily in order not to arouse the greed of other potential buyers, and so potential sellers would not raise their prices,” Alberto said, according to a 2001 biography.

As golf club construction began, Palacios writes, the brothers pushed through government approval of a plan to convert their thousand acres into a “luxury community” named Colonia Del Valle, with the private acres where Gabriel now resides on its edge. The plan included a clause stating all surrounding properties should share Colonia Del Valle’s vocation because, “agricultural ranches would demerit the value of the community.”

Like whales in the cryptoart space, Monterrey’s elite transformed San Pedro Garza García into a playground for the rich. In fact, it’s now the wealthiest municipality in all of Latin America, with Colonia Del Valle’s luxury apartments and fashion boutiques at its center. The displaced migrated elsewhere, often to nearby neighborhoods, where families struggle to put $5 worth of gas into their cars.

On Saturday evening, we order delivery food at Gabriel’s house – burgers and fries – and the conversation turns to the SuperRare DAO. 

On the day of its announcement last August, the SuperRare DAO released a token ($RARE) and proportionately distributed 15 percent of the 1 billion total supply to the crypto wallets of art collectors, artists, employees, investors, and partners. Token holders are empowered to shape the platform’s future in proportion to their personal token share. SuperRare marketplace royalties are now funneled into the DAO community treasury. Thus, if you own one percent of all $RARE tokens, you technically own one percent of the DAO’s value and one percent of the voting power on all proposals and initiatives.

Before dinner, I explain to Nain and Gabriel that SuperRare Labs is now working to decentralize SuperRare’s mechanisms for discovering and incentivizing new curatorial voices. This will enable token holders to empower and reward new artists and curators around the world. What I don’t say is that, for this to truly be revolutionary, it’s essential that we decentralize not just our voting mechanisms but the token itself. As of today, the lion’s share of $RARE is still held by whales, employees, and early investors. Can we trust them to make decisions based on anything but personal interests?¹

Gabriel tells me he’s accruing as much $RARE as he can. He believes in the platform’s mission, and wants a large stake in its future. Recently, the DAO voted to approve his application for a SuperRare Space, giving him a gallery of his own within SuperRare, and the royalties from associated sales.

The food arrives. It’s unpackaged by housekeepers in another part of the house and brought to us on a tray with a lid.

On Sunday morning, I take the Greyhound bus back to the US. In the months ahead, I’ll talk to multiple artists who – save one who felt taken advantage of – say Gabriel has propelled their careers. Sure, he’s at least somewhat driven by profit, but what’s wrong with caring about profit? Isn’t that what brought cryptoart success in the first place?

I’m reminded of an expression in Mexico: La mordida, which translates literally to “the bite” but is better understood as “the bribe.” You could argue that Mexico has two tax systems: the state sanctioned list of standard impositions, and a cancerous form of bribery and extortion known as la mordida.

The state’s system is near anemic. Both the richest and the poorest slip through its enfeebled grip. La mordida, contrarily, is near omnipotent. From the policeman turning a blind eye to the scent of whiskey (or the sight of cocaine kilos) at a DUI checkpoint, to the campaign donor’s nephew winning a government construction contract, it marbles effortlessly through the economy like a fiscal leukemia gorging on red-blooded corruption.

La mordida isn’t just a Mexican problem. It extends to any industry, community, or local plagued by corruption of power. Blockchain, if used in good faith, could be a tool for weakening it. It could function as an equalizer, a means of establishing transparency. But getting there will require powerful allies, allies whose best interest could run counter to the values crypto espouses. Web3 is nothing more than a new set of tools, dependent entirely on the hands that wield it.

Last week, I sat in on an interview with AI artist Pindar Van Arman. Asked if cryptoart was a revolution, Van Arman replied, “a revolution? No. I think the future will most likely see the merging of the traditional and crypto art worlds into one. With this, we’ll inherit some of the bad from their systems and, hopefully, they’ll be forced to adopt some of the good from ours.”

Perhaps crypto is not a panacea, but a step in the right direction. Or, conversely, just another hypothesis to cross off the list. Either way, if you look past where mainstream rage wrote “ponzi scheme” in all-caps on the door, you’ll find a world of defiant artists and technologists with exciting ideas, whose lives have been changed for the better, and believe yours could be too.