On Aug. 23, 1965, a performer walked a tightrope at the Canadian National Exhibition’s matinee grandstand show. A photographer captured the moment from below, as the entertainer balanced on the rope on his right foot, with his arms spread outward. A Canadian flag dangled in the background.
It is unclear, in the black-and-white photo, whether the funambulist used any safety devices. But the CNE hopes the archival shot will help save the exhibition from financial ruin. The CNE plans to digitally manipulate the picture and sell it as a non-fungible token (NFT), making the 142-year-old institution a new player in the world of cryptocurrency and blockchain.
“The sky’s the limit,” Darrell Brown, the CNE’s executive director, said. “It could be a complete washout or there could be a significant amount of interest.”
It is an act of creative desperation. Coronavirus restrictions forced Toronto’s CNE to cancel the 2020 and 2021 editions of the exhibition, resulting in a financial bloodbath. The CNE expects to run out of cash by December, unless it lands $11-million in government bailouts. Scores of fairs and exhibitions across Canada, both urban and rural, are in similar binds. The Canadian Association of Fairs and Exhibitions this week said 32 per cent of organizations that host these summer staples are at risk of folding.
The CNE and its counterparts such as the Calgary Stampede and the Pacific National Exhibition are lobbying governments across the country for cash and negotiating with lenders as debt piles up. The Calgary Stampede this week asked its home city, which backstops its loans, to waive its 2021 financial covenant governing its debt service coverage ratio, and sign off on other amendments with its lender, such as another $10-million credit facility and more deferred debt payments. The Stampede, unlike the CNE, is a go this year. Vancouver’s PNE, which also warns it is on the verge of crumbling, is asking Ottawa for $4-million in wage subsidies and another $8-million in provincial and federal funding. It is planning a miniature version of its annual fair this year.
The CNE, however, is alone in its foray into NFTs and other unconventional fundraising ideas, such as selling community bonds and launching GoFundMe campaigns.
An NFT is like a digital certificate, stored on a blockchain, proving ownership rights. It plans to take the 1965 tightrope photo and insert a digital representation of the coronavirus hanging from one of the performer’s arms and a vial of vaccine off the other.
The CNE hopes to get into the NFT game in the coming weeks, and it is already squatting on rarible.com with a photo of Freddie Mercury singing at the fair on Aug. 30, 1980. CNE is asking 0.125 ether (ETH) for one of 100 associated NFTs. One ETH was worth US$2,416.46 Friday afternoon. The NFT would give buyers the right to use the image – perhaps print it out and frame it – for non-commercial purposes. The CNE’s terms will allow it to collect a royalty each time one of its NFTs trades hands.
“It is a bit blue sky,” said Mr. Brown, a lawyer with a background in the art business.
Meanwhile, he is pressing Ontario and the federal government to come up with a combined $11-million rescue package. The CNE has blown through the $7-million it had on hand before the pandemic and is now living on a $4-million credit facility. Its staff is down to about 16 from 42 and more layoffs are expected soon. Ontario and Ottawa did not provide responses to questions about support. The federal government has budgeted $200-million to support local festivals and community events and another $200-million for major festivals.
Alberta expects to lift the majority of its COVID-19 restrictions before the Calgary Stampede starts in July. The Stampede needs the revenue from this year’s fair to curb the flow of red ink, but interim chief executive Dana Peers noted this 2021 event is about financial survival rather than recovery.
“It is really a bridge year,” he said in an interview.
British Columbia earmarked $50-million to support major anchor attractions, although the one-time grants are capped at $1-million for urban attractions. “All three levels of government need to work together to provide much needed support,” Carla Wormald, a spokeswoman for B.C.’s Ministry of Tourism, Arts, Culture and Sport, said in a statement.
Shelley Frost, the PNE’s chief executive, said she recognizes need for government support is broad, but if her industry’s bailout requests go unanswered, the consequences will extend beyond organizations like the PNE, CNE and the Stampede.
“If the big institutions fail, you can guarantee that the small ones will, too.”
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