Why a museum sold Mandela’s arrest warrant as an NFT

When a mustachioed young lawyer named Nelson Mandela moved to a farm a few miles north of Johannesburg in late 1961, he was a wanted man. 

A warrant was out for his arrest for trying to topple South Africa’s white government. At the farm, called Liliesleaf, he slipped into workers’ overalls and spent the next few months posing as a gardener named David, using the cover to help organize anti-apartheid activities with the farm’s other residents.  

Less than a year later, however, the law caught up with Mr. Mandela, and he was arrested outside the town of Howick, 300 miles away. 

He spent the next 27 years in prison. And the rest, as they say, is history. 

But now, Mr. Mandela’s arrest warrant, and the farm where he once hid out, are making history a second time – with a 21st-century twist. Last month, a high-tech virtual copy of Mr. Mandela’s arrest warrant sold for $130,550 as a non-fungible token (NFT).

It was the first archival document in South Africa to be sold as an NFT, and the proceeds will benefit the struggling museum that now sits on the site of Liliesleaf Farm. 

On a continent whose historical artifacts have routinely been plundered by outsiders, the sale has been hailed as a savvy way for African countries to hold on to their heritage while also cashing in on the global elite’s new obsession with digital collectibles. But it also raises concerns about what could happen when the past – or a virtual copy of it – is auctioned off to the highest bidder. 

NFTs operate by storing a digital asset – like an image, video, or audio file – on a blockchain, a secure ledger that records whenever the item is bought or sold, and can be used to prove its origins. In recent years, the NFT market has boomed, reaching a market value of $41 billion by the end of 2021, in large part because of NFTs’ popularity as a way of buying and selling digital art. (The conventional art and antiques market, by comparison, was worth about $50 billion last year.) 

“It’s a double-edged sword,” says Themba Wakashe, a trustee of the Liliesleaf national heritage site, and former director-general of South Africa’s Department of Arts and Culture. “It could be an excellent tool to preserve our heritage. But a lot of people have also been asking, are we selling the family silver?” 

Mr. Mandela’s own family and associates have grappled with the question. In January, the New York auction house Guernsey’s said that it been contacted by one of Mr. Mandela’s daughters to sell off several valuable items associated with the anti-apartheid icon, including the key to the jail cell where he was detained for two decades. The auction house called off the sale after South Africa’s government intervened, saying the key “belongs to the people of South Africa.”

The answers are even less straightforward in the digital world.

Keeping the lights on

The original of Mr. Mandela’s arrest warrant will stay in the Liliesleaf archive. As part of their purchase, the anonymous owner of the NFT will have the right to view the paper copy – with its ragged-edged yellow paper and three-hole punch down the left side – but not to take it away. 

For those running Liliesleaf, that seemed like a great compromise, since the site announced last September it didn’t have the cash to keep the lights on or pay staff.

“Over the years, it’s become harder and harder to secure funding from traditional sources,” says Nicholas Wolpe, the son of human rights lawyer Harold Wolpe, who spent time at Liliesleaf organizing for the liberation movement. With the buzz around NFTs, he thought, Liliesleaf could fundraise without resorting to selling some of its most valuable possessions.

The core of the purchase is a three-dimensional scan of the document – highlighting how the value of NFTs, like most collectors’ items, is in their rarity, not in their utility. 

“At some point we as a society decided this metal called gold has a value, and so it has a value. Now we’ve decided the same thing with NFTs,” says Nerushka Bowan, head of technology and innovation at the law firm Norton Rose Fulbright South Africa. That value is in part based on the fact that the technology behind NFTs makes them easy to verify and trace. 

But beyond that, things start to get fuzzy. 

“What you are actually purchasing is in the fine print,” Ms. Bowan points out. Sometimes it includes digital copyright, for instance, and sometimes it does not. 

When asked if Mr. Mandela’s arrest warrant could still be placed in a digital archive for public use, trustees of Liliesleaf were unsure. 

“I never thought about that,” says Nicolas Wolpe, the former CEO of Liliesleaf.

“The area is quite murky, to be honest,” Mr. Wakashe says. “There aren’t really established standards and norms.”

Owners’ rights

Ahren Posthumus, CEO of Momint, the digital auction house that brokered the sale with Virtual Nation Builders, a local NFT company, says the buyer has the full digital copyright to the arrest warrant.

“It’s not dissimilar to the situation with physical heritage items – you could display it in your house, you could lock it away in a cupboard, or you could put it in a museum where it could be shared with the public,” he says.  

That means, he says, that the owner can decide if members of the public can see the NFT and use it for research – or not. 

Meanwhile, for now the NFT exists in tandem with a real piece of paper, a fact that Liliesleaf has been careful to stress. But if the original were to be lost, stolen, or destroyed, that could also exponentially increase the value of the digital copy, Ms. Bowan notes.  

Still, for African museums like Liliesleaf, there are some immediate advantages to dabbling in NFTs.

“One of the things that’s been a challenge for a long time has been the illicit trafficking of African heritage,” says Mr. Wakashe. “So this digital authentication is a huge plus in terms of safeguarding our heritage.” It also allowed Liliesleaf to add a clause to the sale saying it gets a portion of the proceeds every time the NFT changes hands – which is easy to track because all transactions on the blockchain where NFTs live are public and verified. 

Beyond that, NFTs may simply prove too lucrative to avoid.

Liliesleaf had been a nerve center for the liberation movement in the early 1960s, with activists like Mr. Mandela frequently coming and going. In July 1963, police raided the farm, arresting 19 people for sabotage. Many were handed life sentences. Today, activists say Liliesleaf stands as a poignant physical reminder of the history of resistance that created modern South Africa. But the pandemic threatened that.   

“During the pandemic, Western institutions leveraged their ability to go digital and used that to stay alive,” Mr. Wakashe says. “But for many African museums, we were literally dead. It was extremely traumatic.” 

For now, the sale of the Mandela NFT won’t be enough to reopen the museum, Mr. Wakashe says. But its owners are hustling for new funding, including possible additional NFTs. 

“It has started a conversation at a broader level – how protected are our cultural institutions? What do we need to do to safeguard them for the future?”