A game-changing week in crypto

The political view on crypto did a complete 180 this week, leading to a surprise ETH ETF approval and potentially changing the whole landscape for crypto companies in the US. We'll get into that, but first, music has found a new groove. Here's everything you need to know.

Music headlines

Music finds a groove with viral social mini apps

The web3 music space has been struggling for direction lately. NFT sales have dried up and momentum among the core community has waned.

I've personally been soul-searching about what the future looks like, but I'm finally feeling the early sparks of something new. A wave of crypto-powered music apps have launched recently and I think it's showing us a path forward.

• Poke launched this week on Farcaster — you choose your 8 favorite artists, match up with other people who like the same music, then poke them. (Try it).

• Sonata is another new music app on Farcaster — you share songs and get paid in tips if people like your music taste. (Try it).

These sound really simple and fun, but there's layers to it.

Every interaction on Poke and Sonata is captured onchain and tied to your Farcaster identity so these apps are quietly building a social graph around music that we've never had before. Imagine if Instagram could talk to Spotify. That can't happen in Web2 but it can here. Music legos!

It's also much more approachable for new people. There's no speculation and no crypto-purchase required. It's using blockchains for their open data / composability characteristics rather than hyper-financialization. It's a whole new design space I'm personally very excited about.

[Disclaimer: I'm involved in Poke]

Quickfire music roundup

• Trading songs like memecoins? - a new music platform called Crate just launched, allowing you to create a song with AI, turn it into a crypto token and begin trading. The platform did $40k+ volume in the first two days of launch and the first song is already trading at a $200k market cap. (Read more).

• Major artists land on Solana - Former Atlantic-signed Arlie drops music on Drip Haus, an nft marketplace on Solana. (Read more).

• Generative music collection - Producer Dav launched Cycles, a generative CC0 music project on Zora. (Read more).

• Snoop Dogg drop - Snoop Dogg drops two exclusive tracks on Gala Music. (Read more).

Zooming out: broader crypto news we're watching

• 💸 Farcaster raised $150 million - the web3 social protocol announced a huge raise. Funds will be allocated to growing users and hiring. (Read more).

• 🔼 Farcaster-based tokens soar - DEGEN and HIGHER were among the biggest gainers of the whole week. (Read our recent research report for more on these tokens).

• 🙌 ETH ETF approved - US regulators have done a shock 180 with a suprise approval of an Ethereum ETF. ETH is up 22% since the news leaked on Monday. (Read more).

• 🏛 Two major crypto bills get bipartisan support - The FIT21 Act (which gives more clarity on tokens and digital assets) just passed The House with surprise Democrat support. It comes days after the Senate passed a resolution to overturn SAB 121 — a 2022 ruling with excessive accounting standards for entities custodying crypto.

• CryptoPunks new collection backlash - The new "Punks In Residence" collaboration with renowned artist Nina Chanel was slammed by the community. Many holders think it violates the "do nothing" philosophy of Punks. (Read more).

• 💀 GALA hack - The GALA token (tied to the Gala Music and Gala Games ecosystem) was compromised. The hacker printed $200m of new tokens. (Read more).

• Base onchain summer round 2 - a year after launching, Coinbase's L2 Base is gearing up for another "onchain summer." They're lining up buildathons and grants. (Read more).

• 🎨 Art Blocks Studio - The iconic nft art platform (home of Fidenzas, Ringers) launched Art Blocks Studio — an artist collective with a more relaxed publishing schedule. (Read more).

The ETH ETF changes everything...

A longer note before I round-out the newsletter because the ETH ETF is a bigger deal than it seems.

The news was a shock, and it represents a complete 180 from US politicians. In particular, the tone has shifted on the left, with Democrats moving away from Elizabeth Warren's "anti-crypto army" rhetoric. Maybe they realised that crypto is a key election issue in swing states ... or maybe their hand was forced by Trump's recent crypto support ... or perhaps moderate Democrats have always quietly been in favor.

Whatever the reason, something changed this week...

It's not just the ETF. Two pro-crypto bills passed through Congress with surprise cross-partisan support, aiming to repeal cumbersome crypto requirements and giving new guidance and clarity on digital assets. Not only did a wave of Democrats turn out to support the bills, the White House backed down on its threat to veto.

Wait, why does this matter for music and culture onchain?

Washington is taking the pressure off the crypto industry which is good news for positive actors across the space building products.

It means we're closer to getting clarity on whether launching a token is a security, making it easier for companies to store and custody crypto while outlining legitimate ways of raising capital. It should give entrepreneurs more confidence to build and raise capital in the US instead of going abroad. It normalizes and even encourages innovation in the space and makes progress more likely.

Simply put, it could change everything.

Thanks for reading!

Disclosures: We may own assets and NFTs mentioned in this article, have previous or current contracts with companies mentioned and may earn referral income from links to music NFTs. This newsletter is purely informational and should not be considered financial advice. Nothing in this content should be considered a recommendation to make a particular investment, only an expression of our opinion.