The decentralized nature of blockchain technology can disrupt existing patterns within any industry. Creative artists can now add blockchain technology to their work, helping them increase their revenue and distribute ownership of their art, whether music or digital artwork, through non-fungible tokens (NFTs).
The total NFT marketplace was valued at roughly $250 million in 2020, showcasing a sharp increase that year. NFT hype took over much of the media space, bringing forth more opportunities for both small and established artists to join the music industry’s second digital reconstruction. While the music industry has already suffered significant changes in the past decades, the emergence of NFTs offers artists more control of their music and could solve existing power struggles between musicians and publishers.
With demand and appreciation for NFTs increasing within the music industry, so are the marketplace offerings. Canadian singer-songwriter Grimes recently sold $6 million worth of digital art as NFTs, while 3LAU reached another milestone, auctioning NFTs for $11.6 million. Each upcoming project creates more monetization avenues by diversifying NFTs’ position in the current market. Most recently, Crypto.com announced its expansion into this marketplace, signing Snoop Dogg and Lionel Richie to produce NFTs.
On the Flipside
- The concept of a paradigm shift empowering musicians through NFTs is a misconception as there is no proof that less well-known artists have benefited from generating NFTs.
- The high entry point to mint or sell NFTs will sideline small or medium artists.
- The value of an NFT can decrease if artists decide to mint future tokens to generate additional revenue.
NFT Disruption In The Music Industry
The digital landscape is constantly evolving, and musicians and artists alike must adhere to the emerging norms. Spotify (NYSE:) and Soundcloud created new avenues for artists to monetize their music and increase exposure as digitization became more predominant. NFTs offer a similar solution through blockchain technology, allowing musicians to engage fans in creative ways and generate more revenue.
Musicoin was one of the first projects to cater to the music industry, providing a free platform where artists could be rewarded directly by their fans. However, the paradigm shifted in 2020, with NFTs offering new opportunities for monetization by marketing each record’s unicity.
New platforms, such as Rarrible, Nifty Gateway, and OpenSea, have monopolized the marketplace, creating hysteria for NFTs. These platforms provide a wider offering of NFTs, diversifying into multiple forms of art and beyond. If you consider farts to be music, you’ll be pleased to hear OpenSea offers a selection of fart sounds for $85.
The music NFT marketplace is expanding as demand increases and new projects are developed to cater to musicians’ needs. Blockchain within the music industry will empower artists to hold the right to their music or video through their private keys, while distribution via NFTs will mean that buyers will have the right to one unique copy. See below for more details of some of the new platforms offering music NFTs.
ROCKI is a new digital music streaming service and payment network that aims to reward artists directly through its in-app native tokens, $ROCKS. The platform operates on a hybrid user-centric model where artists are rewarded in either crypto or fiat.
The platform issues ERC-1155 standard NFTs and offers users “exclusive listening rights.” The platform is currently in beta, but the company successfully auctioned through Bounce.finance the royalty rights of a song by Israeli progressive house DJ Guy J, which sold for 40 ETH.
The platform provides a much-needed increase in revenue streams for artists and musicians in the wake of COVID-19. Despite their beta version, the platform already has more than 30,000 tracks (as of December 2020).
Audius is a decentralized streaming platform operating on multiple nodes to ensure music is owned solely by the artists themselves. The platform has over 3 million monthly users and opens the possibility to include your NFT library in the network.
Pitching itself as the “bedrock of the creator economy,” the platform is a hub for artist/fan interaction. They’ve also enabled the Audius passport, allowing users to connect to the web 3.0 ecosystem.
The network is permissionless. Thus it enables other creators to harness the entire library and make a new look and feel using the existing music. Furthermore, participants in the network are rewarded for their contribution to running a node.
Catalog is building a business model similar to Bandcamp, where artists upload, collect, and trade unique digital records. As emphasized by the company, the NFTs on the marketplace will be authenticated by the artists themselves and certified.
Catalog is an open marketplace for niche artists, who can choose to receive between 0-100% of all sales. The value of Catalog is that it creates a marketplace for 1-on-1 records, building on unicity and scarcity.
The Next Phase For Music NFTs
NFT music marketplaces are just beginning to be recognized as more businesses have identified their value. Most recently, established electronic music publication XLR8R mentioned the development and release of their NFT marketplace. Meanwhile, TUNE.FM will also launch its own marketplace. More marketplaces, such as STURDY.exchange, are currently being built, each with its own value proposition to help artists connect with their audience and monetize their IP with ease.