Yes, they do. It may be the case that demand in the art world defies the expectations of rational choice theory that demand will be a function of utility realized by the buyer if they are successful in the transaction, but prices are still driven by supply and demand.
> Lots of people get to wanted status simply because they knew the right folks or were lucky.
How demand is generated and whether or not it is rationally-grounded has no bearing on whether supply and demand “flesh out”.
> It isn't so much originality or that there wasn't a supply of art.
It's that art works that you consider adequate substitutes for each other are not considered adequate substitutes by a sufficient subset of buyers such that the availability of tons of generic art at cheap prices does not drive down the market-clearing price of less-available in-demand art.
I'm curious though how many actors act rational in specific economic systems. Especially with cryptocurrencies I feel like the low amount of rationality might be a significant hurdle to establishing a robust economy, even if everything else is ironed out (proper use case and incentive system).
Irrational actors are only punished when their irrationality exceeds a threshold, which is rare in these days where we don't let people starve to death easily.
It isn't so much originality or that there wasn't a supply of art. There is a supply of art. Good, well done art that will meet your needs and slews of folks that will do commissions if you do. If anything, there is more art than there is demand, even if you are into non-mainstream stuff. If it were different, art school would be an excellent choice for your financial future.
As another reply said, there is a lot of money laundering in the art world as well. I imagine there are some questionable tax dodges in it too.