[PC Mag] Is AI Ruining Etsy? Loosening Definition of 'Handmade' Frustrates Artists, Buyers

Tools like Midjourney make it easy to churn out AI images and list them for rock-bottom prices without disclosures, endangering the livelihoods of the real-life artists who struggle to compete.

Etsy’s reputation as a haven for small, independent creators has come into question as tools like Midjourney have made it easy to list art without disclosing that it’s been AI-generated, and shoppers are not happy.

“The fact that it’s AI isn’t listed anywhere,” says one Reddit user who purchased a stock photo on Etsy that seemed suspiciously low cost with glowing reviews. “I was so mad at myself for not noticing it was AI before purchasing.”

The seller of the photo, CanArtStudio, lists no information on the “About” section of its shop, beyond that it’s based in “Europe.” It makes mockups for online businesses, specifically images of nondescript people wearing blank T-shirts. T-shirt sellers, like the Reddit user, then edit the photo and add their designs before listing the product for sale online. CanArtStudio sells them for just $3, or currently $1.50 with a 50% off sale, an ultra-low price for “photography.”

“Being avid user of Etsy, I really enjoy supporting small businesses and the talent that goes into their work,” the buyer tells PCMag in a private message. “Shops such as we discussed selling massive amounts of AI-generated images take away from genuine sellers who put hours into perfecting their craft.”

Others agree. “YES!!! I run into this frequently! Sometimes I’m in a hurry and don’t look closely enough at every detail of the image, until I try to use the mockup and find half a fork, or a baby with 6 fingers,” someone else wrote on Reddit. (Hands are notoriously difficult for image generators to reproduce accurately.)

Watercolor art—some of which is sold as digital downloads—has especially fallen prey to cheap, AI-generated listings. “All the watercolor art on Etsy is practically AI and they sell a lot,” says one watercolor artist.

Another adds that their sales have “absolutely tanked” since the proliferation of AI tools: “This time last year I was making enough to purchase a home, and now I’m thinking about going to work at a grocery store or doctor’s office just to pay bills.”

Etsy’s seller policy does not mention artificial intelligence. The platform is still determining the place AI-generated works have on the site, a source tells PCMag. Complicating matters, some sellers take AI-generated images and modify them, adding a hint of human artistry. The ability to combine human ingenuity with AI is the main reason the US Patent Office ruled in February that AI-assisted inventions are patentable, though the human contribution must be clearly stated.

Etsy also has a policy regarding when sellers can claim an item is “handmade,” but it also does not mention AI and appears virtually unenforceable.

“At Etsy, we value transparency,” it reads. “Transparency means that you honestly and accurately represent yourself, your items, and your business.” It says sellers are required to disclose the “names and roles of people who help make your items” in the About section and only explicitly prohibits reselling items and peddling online coupon codes, which are more clear-cut infringements.

Legally, works created by AI are not protected by copyright law and can be freely sold. If customers are happy with the low-cost AI products, what’s the issue? CanArtStudio, for example, has over 82,000 sales and a 5-star seller rating.

Scammers could see an opening to cash in on on the gray area while they can. One Reddit user says they “know a guy running a full-blown Etsy scam” where he prints out AI-generated images and paints over them. AI tools also make it possible to impersonate artists by generating work in their style.

“Words can’t describe how dehumanizing it is to see my name used 20,000+ times in MidJourney,” writes photographer Jingna Zhang on X. **“**My life’s work and who I am—reduced to meaningless fodder for a commercial image slot machine.”

Beyond the legalities, Etsy shoppers debate the ethical and economic implications. One argues it devalues the work, citing an ancient example of explorer Mansa Musa handing out fake gold during his travels, inflating the overall supply and tanking the market. If anyone can create art at the push of a button, what defines an artist’s work? And what role does Etsy play in answering that question?

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Um…this policy seems pretty enforceable to me. If Etsy doesn’t provide the resources to enforce it, then that’s a choice Etsy is making.

And yes, AI is ruining handmade and handicrafts, from AI-generated images that don’t reflect realistic work, to unscrupulous “handmakers” selling AI-aided works without disclosures.

At this point, I personally recommend to most people shopping for truly handmade items, to try MakerPlace or in-person/known handmakers or events only, unless they are prepared to spend a lot of time researching and reading reviews.

Etsy, Amazon, even MakerPlace must step up with the right policies and the right staffing to enforce them, or they will lose any remaining consumer trust.

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That ship sailed a long time before all this AI nonsense.

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