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Music has a new canvas.
NFTs directly value creative work, without input from an intermediary.
We’re witnessing the early stages of an audio movement - driven by scarcity, fandom and access.
This article highlights the Music NFT landscape - providing insights for musicians, managers, labels, agents, fans and collectors alike.
Let’s dive in.
*EDIT: Looking to stay up with Music NFTs? I write a weekly newsletter on everything you need to know.
Subscribe to This Week in Music NFTs here.*
Music NFT are fixed quantity, tokenized audio files.
The main characteristic is the audio itself, typically represented as an .mp3 or a .wav.
We saw early examples of musicians exploring NFTs on Nifty Gateway in 2021. Since then, Music NFTs have shifted focus away from an audio/visual collaboration, to the audio itself.
In fact - the vast majority of Music NFTs today can be thought of as extremely rare digital collectibles.
Think of it like buying a track on iTunes, except now you have a limited copy you can resell to someone else.
Over time - Music NFTs will contain ownership rights. However, it’s currently the exception, and today most Music NFTs have no claim on underlying rights.
Music NFTs build superfan communities.
As a collector, Music NFTs are the single best way to build a relationship with your favorite artist.
Tokenized music represents an indirect way to bet on an artist’s career - even if there are no rights associated.
In the same way fans collect setlists, drumsticks, t-shirts, posters and tickets from historic shows - Music NFTs are the most direct iteration of fandom.
Remember how it felt to collect music?
We’ve all bought vinyl, burned a CD, or made a playlist. Chances are you’ve shared a Spotify song on your Instagram story.
But - the art of collecting music has gotten lost. Every song in the world can be accessed for $9.99 a month.
I don’t think that’s right. I’m proud of the music I curate and I’m sure you are too.
Music NFTs are the new way to have an intimate connection with a song.
They’re a bet on an artist’s career, and your social graph to signal the genre(s) you love.
Think of Music NFTs in the same way we value Crypto Art and Collectibles.
I wrote about my thesis for NFT Value Capture - the same principles of which apply here.
https://coopahtroopa.mirror.xyz/A16NP2XXi9RdHptfdF9WHR0Xq_E1XDmUgMwPmJYOG7w
TLDR: The stronger the community of superfans, the more valuable the Music NFT becomes.
As a rule of thumb, the more streams a record has on a web2 platform like Spotify, the higher likelihood it performs well in web3.
However - the more exciting avenue is curation.
In the same way electronic artists made their career on the back of SoundCloud in 2013, we are now seeing the same ethos apply to web3.
Music NFTs from artists who make their career in web3 will outperform those who tokenize past work that succeeded in web2.
This is why we’re seeing artists with smaller, niche audiences in web3 consistently outselling those with hundreds of thousands - or millions - of monthly listeners on Spotify.
Music NFT collectors will allocate capital to the strongest web3 communities.
If you’re an artist with a large following, think about how to convert your most loyal fans to web3 and the bids will follow.
Here are the projects leading the Music NFT movement.
This list is non-comprehensive, and ever-evolving. I definitely missed some.
EDIT: The Music NFT Landscape has grown quite a lot since then.
Here’s a look at an updated landscape as of Q2 2022.
It’s a big world out there.
If you’re feeling overwhelmed, here’s a guide on where to start.
We’re living in the wild west - there’s no one right answer for Music NFTs.
In fact, the best thing you can do is experiment.
Get out there and test the waters. Don’t get caught up in perfection, mint something and learn over time.
Here are some principles to follow:
Fans First - Don’t worry about money. Prioritize relationships with fans and the money will come.
Don’t Oversell - Scarcity is on your side. Be tactical about how you release new projects into the world.
Give Back - Invest your time and money back into the community. This is your bedrock for future success.
Be Nimble - Build relationships with many platforms. You are in control of your audience - take advantage.
There is a steep learning curve with Music NFTs. However, once you get comfortable, the plateau is wonderful.
Don’t expect overnight success - plan on spending a month educating yourself and becoming one with the community before expecting anything in return.
Looking to learn more?
Here’s a list of articles and to get you caught up.
And for those who prefer to listen over read:
We’ve entered a new chapter.
Music NFTs are bigger than one platform. It’s a new medium. A movement.
We’ve gone from vinyl to tapes, CDs and now mp3s.
While we may live in the streaming age today - NFTs are the natural successor.
Beyond NFTs, creators are turning into organizations. Opportunities that were once limited to a select few are becoming accessible to all.
Betting on your favorite artist is finally here.
Think you’ve got an ear for discovering new talent?
Well - here’s your shot to make it worth something.
For artists, the tools are on the table to take your career into your own hands.
For fans, there has never been a better opportunity to work for the artists you love.
You’ve got a narrow window before major labels adapt - so don’t sleep.
This is a 10-year game. The infrastructure is still being sorted. Onboarding is brutal. The barriers to entry are high.
This is your opportunity to connect the dots and create change.
Imagine if you could be one of the first artists on Napster, MySpace, iTunes, Soundcloud or Spotify.
Imagine if you could build diehard relationships with the leading voices shaping music today.
It’s all happening, and it’s all out in the open.
Dive in.
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