In this week's newsletter, we talk about the dark world of art money laundering, what 6GHz & its impact on India, block deal and more.

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A $6 million banana?!

The Mona Lisa is worth close to a billion dollars. But who decides the value of art, anyway?

Is it the artist’s fame? The rarity of the work? The materials used? Or maybe it’s the story behind it — like a piece once owned by a celebrity could make it irresistible to collectors willing to splurge millions.

But none of this logic applies to ‘Comedian’, or as you probably know it, the ‘duct-taped banana’.¹ This cheeky creation by Italian artist Maurizio Cattelan isn’t exactly what you’d call classic art. It’s literally a banana stuck to a wall with silver duct tape. And yet, it just sold for a staggering $6.2 million at Sotheby’s auction house. Yup, you read that right.

Think about it. The banana itself probably cost 35 cents at a fruit stall outside Sotheby’s on the day of the auction. If you do the math, its value shot up by an absurd 18 million percent!

So, how on earth did this happen, you ask?

Well, if you look at it from the lens of Justin Sun, the buyer of the $6 million “duct-taped banana” and founder of the cryptocurrency Tron, this wasn’t just art. It was an idea. For him the banana apparently represented the connection between art, meme culture and the crypto community. It’s what’s called conceptual art, meant to challenge how we think about value.

The banana might show how value isn’t fixed but shaped by culture. And since memes highlight the absurdities of modern life, linking them with art makes it relatable to younger, tech-savvy folks. For the crypto crowd, it’s a way to show how something unusual and intangible, like Bitcoin or even Tron, can hold incredible value.

Sounds bizarre?

Sure. But here’s the thing. Sun didn’t just buy a banana, he bought attention. Tron’s popularity skyrocketed after the purchase, with its value jumping 10% and hitting an all-time high since its 2018 debut.² Its market capitalisation (total value of Tron coins in the market) reached a staggering $18 billion.³ That’s over $1 billion added in just a couple of days!

But hey, that’s just how it looks from the outside. What no one’s talking about is how artworks can double or even triple in value, fetching millions or even billions through the murky world of art laundering.

The truth is, the skyrocketing prices of artwork often have little to do with subjective value, abstract concepts or prestige. Instead, the art market provides a convenient loophole for wealthy individuals to launder money or hide the origins of illicit funds. And it works like a charm.

For starters, there’s no universal method to price art. It’s all subjective, which means you can buy or sell art at any price you like. This lack of standardisation creates the perfect cover for moving questionable money around.

But that’s not the only advantage of the art world. It’s also shockingly underregulated, which means you can buy an artwork with a suitcase of cash, and do it all anonymously.

Why? Because collecting art is like owning treasure. If people know you own it, the chances of theft shoot up. So, to protect identities, the art world offers complete anonymity.⁴ Auction houses and galleries won’t reveal the buyer or seller’s name unless they get explicit permission, or even enough money to keep their identity tightly locked up.

And here’s where things get even shadier. Imagine a money launderer uses $10 million in black money to buy a painting — anonymously, of course. They don’t need to hang it in their living room to make it legit. Instead, they can send it to a ‘freeport’.⁵ For the uninitiated, these are storage facilities near airports for goods in transit or items shipped by a seller but not yet received by the buyer.

But in the art world, they’ve become loopholes. Since these spaces don’t fall under any specific country’s jurisdiction, they’re essentially tax-free zones. So the money launderer parks the painting there and waits. Eventually, another buyer — real or not — purchases the piece for an inflated price. Ownership changes hands, but the artwork doesn’t move an inch.

Suddenly, that $10 million has turned into ‘clean’ money, and no one’s asking questions. This game can repeat endlessly, with the price of the art skyrocketing each time.

And that, folks, is how art magically gains its so-called ‘subjective’ value.

That’s exactly why countries are scrambling to put anti-money laundering laws in place, keeping a close eye on suspicious activity in the art world.⁶

Take Mexico, for example.⁷ Back in the early 2010s, the government passed a law requiring more transparency about buyers and limits on how much cash could be spent on a single artwork. The result? The art market plummeted. Sales dropped by 70% in less than a year mostly because Mexican cartels were some of the biggest buyers in the market.

More recently, the US introduced the Anti-Money Laundering Act of 2020 (AMLA 2020), which forces antiquities businesses to identify the true owners of art, maintain transaction records and regularly audit their compliance.

The European Union’s 2020 Anti-Money Laundering (AML) Directives also require art dealers to perform due diligence on customers and report any transactions over €10,000. If they’re trading or storing artwork valued at over that amount, they need to follow strict rules.

So yeah, hopefully, with laws like these, the days of money laundering in the art world will be numbered.

But that being said, we know what you’re thinking. Could this duct-taped banana be part of some clever, shady deal, too?

Well, we can’t tell for sure, especially considering that Cattelan made three editions of Comedian.

Sidebar: Conceptual art is all about ideas, not just physical pieces. So in Comedian’s case, what the artist sells isn’t a duct taped banana, but a certificate of authenticity and a set of instructions for the owner on how to maintain or even recreate the artwork — like how to tape the banana, where to place it, how high off the ground it should hang, and, of course, how often to the banana must be replaced, since, you know, it’s a real fruit that’ll eventually rot.

And here’s where it gets interesting. If you look closely enough, the version that Justin Sun bought for $6 million had quite the ownership journey.⁸ It was originally sold in 2019 by New York’s Galerie Perrotin to an anonymous buyer, then passed on to White Cube gallery, and eventually made its way to Sun via Sotheby’s, who gets a commission for making the sale happen.

Now, we’re not saying that this version of Comedian is caught up in some art money-laundering scheme.

But let’s be honest. When ownership trails involve an element of mystery, they have a knack for driving up prices, no matter how bizarre or downright wacky the artwork might be.

Story Sources: The New York Times [1], U Today [2], Forbes [3], The New Indian Express [4], The Economist [5], Comply Advantage [6], Art & Object [7], Sotheby’s [8]

The battle for the 6GHz band

Imagine you’re at a crowded concert auditorium, trying to leave, but everyone is blocking the way. Suddenly, a secret door opens just for you, and you can walk out without any pushing or shoving. That’s what the 6 Gigahertz or 6GHz band is for the internet. A new, open path that makes everything faster and less congested, even when lots of people are online.

Now, the 6GHz band is a new frequency range. Networks need something to run on, and that’s where frequency bands come in. For instance, 5G runs on the 3.5GHz frequency band, which acts as a highway that carries data for 5G connections. The 6GHz band, however, is a wider highway that can handle more traffic. Its higher frequencies help improve internet speed and reliability.

Because it’s such a valuable piece of property, everyone from telecom companies to tech giants, wants a share of it. And that has sparked a big debate in India right now.

You see, the 6GHz band needs to be allocated, and it’s up to the government and national authorities to decide how it’ll be used.¹ There are two ways this can go — licensed or unlicensed use. If it’s licensed, companies have to pay for exclusive rights to use the band, which gives them full control over it. But if it’s unlicensed, anyone can use it without shelling out money. That makes it more accessible, but it could also get messy with interference since everyone’s sharing the same space.

Right now, the 6GHz band in India is mostly with the Indian Space Research Organization (ISRO) for satellite use.² But a big chunk of it is still unallocated. And the debate is whether some of it should go unlicensed or if the whole thing should stay licensed, just like the bands that came before it.

First up, we have telecom companies who want exclusive rights to the 6GHz band. They say it’s needed to boost 5G and prepare for 6G. More spectrum also means more revenue for telcos and the government. For example, the government made a whopping ₹1.5 lakh crores from spectrum auctions in 2022. Auctioning the 6GHz band could bring in even more money.

Now, this might seem like a win-win, but it’s not that simple.

Because on the other side of this debate we have tech companies like Google, Meta and Amazon, represented by the Broadband India Forum (BIF) who want a part of the 6GHz band to be de-licensed.²

Their case?

Unlicensed access will boost innovation and make internet access more affordable, especially in rural areas. Imagine a school in a remote village getting fast internet because of Wi-Fi using the 6GHz band. This could be a game changer for education. And estimates from a DSA (Dynamic Spectrum Alliance) study are proof of the pudding. They suggest that fully de-licensing the band could add $4 trillion to India’s economy by 2034, driving not just internet speed and innovation but also GDP growth.³

And then we have chipmakers who are also rooting for unlicensed use, because it opens up more business opportunities like adding Wi-Fi to devices and expanding Wi-Fi networks. ISRO too is worried about interference with its satellite operations if the band is used for mobile networks.¹ Which begs the question — Why not split the difference?

Part of the band could be licensed for telecoms, while the rest could be left unlicensed for public use.

Well, it’s not as straightforward as it seems, because the 6GHz spectrum is limited. And if too much is de-licensed, it could hurt 5G growth. Telcos would struggle without enough spectrum and would need to add more small cells or infrastructure used to improve mobile networks. That’s expensive and difficult in crowded cities. On the flip side, if most of the band goes to telcos, it could hurt competition and slow down innovation.

Plus, more crowding can lead to higher carbon emissions. For context, Mumbai’s energy use could triple if there’s too much pressure on the spectrum.

The other option of de-licensing the entire band isn’t without its risks either. It could cause interference, where too many users sharing the same frequency lead to network congestion and slower service.

So what’s the way out, you ask?

Well, different countries have taken different routes. The US for instance, has fully de-licensed the 6GHz band, allowing widespread use of Wi-Fi 6E (Wi-Fi that allows devices to operate on the 6GHz band). This move has also caught the attention of other countries, like Brazil and Saudi Arabia. China has fully licensed its 6GHz band for mobile services, focusing on 5G and 6G.

And now, India’s decision could be crucial. Because the 6GHz band is important for industries like manufacturing, communication and technology. Studies even suggest that if properly used, the 6GHz band could add $285 billion to the Asia Pacific region’s GDP by 2030, with 85% of that benefit in the South Asian market coming to India.⁴

So, maybe a balanced approach could be the best way forward — delicense part of the band to boost Wi-Fi and support digital inclusion, while reserving some for telecoms to use for 5G and 6G in the future?

A GSMA study on 6GHz for India though, does not agree.⁴ It says that without the 6GHz band, Indian mobile operators could find it hard to expand their services. 5G networks will be slower, consumers will end up paying more and industries that rely on 5G tech will struggle to stay competitive. The tax revenue that the Indian government will rake in from 5G will be lower too.

Not just that. It also points out that fully licensing the 6GHz band would bring the most benefits, especially with India’s current broadband setup. And warns that de-licensing it could cause a lot of problems, like higher costs for strengthening networks, higher energy use and a big increase in carbon emissions, thanks to nearly 3 times more power consumption.

So yeah, this whole back and forth over costs and benefits is probably why the government hasn’t made its final call yet. Last year, the Telecom Regulatory Authority of India (TRAI) put out a white paper, suggesting three options ―licensing, de-licensing or a mix of both.¹

But whatever they decide, it must happen soon. If they keep dragging their feet, India could miss out while other countries race ahead. Because, let’s be real, whether you're streaming your favorite show, hopping on a video call or working on the next big thing, faster and more reliable internet is something we can all agree on, right?

Story Sources: TRAI [1], Economic Times [2], The Fast Mode [3], GSMA [4]

Quiz of the Day 💡: Businesses & Startups

Today's quiz is about all things startups- from founders to the buzzwords that define the ecosystem. Head over to this link and give it your best shot. We'll announce the winner next week, so keep an eye out to check if you got lucky!

Good luck & cheers :)

Jargon of the day ✏️: Block Deal

And that's all for today folks!

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