NFTs are a massive deal in the world of art and graphics right now. Digital artists and designers are able to capitalise on an entirely new world of trade and develop connections within this new, exciting community.
But what about other forms of art? Art that isn’t necessarily visual but audio?
Musicians have been extremely targeted in the past decade due to the boom of the streaming era. Data from 2019 and 2020 shows that 90% of streams go to the top 1% of artists. This has led many artists – even with hundreds of thousands of streams – to juggle multiple revenue streams. NFTs may be the answer to this hurdle.
A great example of a music artist who is capitalising on this is Daniel Allan. Allan has been selling digital copies of his electronic pop songs as NFTs—non-fungible tokens—for thousands of dollars each. He spent months cultivating relationships with NFT enthusiasts, built a community of devoted fans online and then leveraged this popularity to raise 50 ETH ($140,000 on the day of trading) in a one-day campaign to crowd-fund his upcoming album.
NFT income and rights also beats many deals offered by major record labels. Allan’s campaign auctioned off 50% of his share of future master royalties—with the half he’s keeping a far better deal than most major-label artists receive (usually 70%)—while giving him a hefty advance and creative autonomy.
On Catalog, 140 artists have sold over 350 records for more than $1 million combined. It must be noted that the goal of these NFT-based musicians isn’t to top the charts, but to push technological boundaries and carve out a living outside of the record label system, which has dominated the music industry for decades. It’s a more alt, cutting edge type of recognition.
You may be wondering, similarly to art NFTs, who is buying? Many of the early buyers of music NFTs are crypto enthusiasts who are financially invested in seeing these spaces succeed; their purchases are both speculative assets and ideological stands. The majority of investors are happy spending money on artists whose vision they believe in plus these investors genuinely believe that music NFTs are going to be significantly more valuable in the future.
Aside from the finance side of things, Discord (the largest cryptocurrency community) is also enabling artists to grow major fanbases. For his next project, Allan wants to break down the wall between artist and fan even further. “I want to be like, ‘Here are 20 demos, let’s make an EP together,’” he says. “There are a lot of creative people in my Discord but they haven’t necessarily had the mechanisms to be able to exercise their creativity.”
Furthemore, since the dawn of social media, record labels are much pickier about who they bring on leading many artists to feel that labels treat up and coming acts as a popularity contest rather than a pursuit for great music. Latashá, an L.A.-based musician who has sold over 50 music and multimedia NFTs, says that the ability of labels to nurture talent from the ground up was already on the wane before the rise of NFTs. “I haven’t connected with a label in years that was fully into developing artists anymore,” she says. “Artists had to before really cultivate numbers on platforms like Instagram, TikTok and Twitter before a label would even look at them. I think it’s important for artists to think about their autonomy.”
We aren’t yet sure exactly how this scene will develop, however, the fact that it is already making money and securing fan bases for artists is promising.