How Music NFTs Could Disrupt the Music Industry
Copyright issues, exploitation, no royalties. These are just a few of the challenges that musicians around the world face when it comes to producing and distributing their music. With the emergence of non-fungible music tokens (NFTs), it is possible that the music industry could be improved.
Read on to find out what music NFTs are, how they work, and how they can empower musicians around the world.
What are music NFTs?
2021 was arguably the year of non-fungible tokens, with multiple use cases emerging beyond crypto art and collectibles. Musical NFTs are one of them.
An NFT is a unique cryptographic token stored on a blockchain that represents a digital or physical asset. Once an NFT is created, it cannot be modified or duplicated. Additionally, NFTs can be encoded in a way that allows royalties to be paid to the creator, making it a very attractive technology for musicians.
Music NFTs are pieces of music recorded on a blockchain in the form of unique, non-fungible tokens that belong exclusively to the owner of the NFT. However, unlike the mp3s you download to your smartphone, music NFTs can also be sold and allow musicians to earn royalties for each secondary market sale.
How do music NFTs work?
When it comes to the music industry, there are different forms in which musical NFTs can appear. It can be a song represented by an audio or video file, an album cover, a concert ticket and signed products, among others.
In the production or sale of a musical NFT, the principle remains the same as in the other NFTs. A musician or band will decide what they want to sell to their fans, be it an audio file, concert tickets or merchandise. They will then identify which blockchain they will mint their NFT on, or which Music NFT platform to use. Some of the currently available Music NFT platforms are YOUR NFT, Opulent, OpenSea, and more.
After identifying their platform of choice, they will notify their fans of the release of their NFT drop, and list them for sale at the value they would like their works to sell.
Since music NFTs (and all other NFTs) cannot be replicated, they may decide to have a one-time sale on an audio file, where the highest bidder owns the original audio file (but not the copyright ). Alternatively, they could decide to create a limited number of NFTs of the same audio file, say 10,000, and then put them up for sale on a music NFT marketplace.
Every fan who purchases NFT music becomes the owner of their favorite musician’s work. They are then able to store the music NFTs in their crypto wallets and, if interested, can resell the NFT to a higher bidder in the future. Although they are the owner of the unique NFT and can sell it, the musician who created the NFT can earn from the resale of their work, which is one of the most powerful ways that music NFTs can empower musicians.
Several musicians and groups have already benefited from musical NFTs. For example, Dj 3LAU had an NFT drop called the UV collection, which had a worldwide record sale of over $11.6 million. This came from a single auction of 33 unique tokens. Additionally, Canadian musician Grimes has sold digital artwork in a collection called war nymph, which was grossing around $6 million at the start of 2021.
How NFTs Can Empower Musicians
Besides earning income from immediate NFT music sales, let’s look at other ways NFTs can empower musicians.
Musicians who create NFTs and sell them will earn subsequent sales of their NFTs. This will help reduce the problem of musicians not earning from the sale of their work, or earning only small amounts from centralized streaming services.
Cut out middlemen
One of the main challenges that musicians face is that they are often under contract with a record company. Alternatively, most independent musicians earn their money through streaming platforms. Either way, using music NFTs allows musicians to earn from the sale of their music or merchandise by selling directly to their fans.
Build an active fanbase
Music NFTs allow a musician to build a fanbase by creating a space where their fans can access unique NFTs related to the artist’s works. For example, events such as NFT airdrops allow musicians to reach audiences they previously would not have had access to.
Additionally, musicians can capitalize on unique fan experiences, such as having the ability for their fans to hang out with them virtually or in person. This has already been accomplished by musicians such as Snoop Dogg during his SandBox meet session, as well as Post Malone, who sold NFTs for people to play beer pong with him.
Provide opportunities for new artists
The low barriers to entry into the NFT music scene are a great opportunity for new musicians, as no one is stopping them from releasing new music or expecting them to fit into a certain “box” to sign a recording contract. With music NFTs, all a musician needs to do is create their music on their platform of choice and market their work to their fan base.
Currently, there are only a handful of musicians exploring the viability of musical NFTs. However, with increased awareness and adoption by fans, the opportunities for artists to benefit from the sale of musical NFTs increase dramatically.
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