This Week in Music NFTs - August 15

August 15th, 2022

Music NFTs became the topic of conversation around how artists should monetize using web3 today.

To summarize - a series of Tweets spurred dialog from prominent founder, trader, and investor Cobie around the viability of Music NFTs.

This sparked a wider surge of opinions from the web3 community on Music NFTs.

This week’s edition summarizes the best of them.

First - some thoughts without the Twitter character limit.

Most “Music NFTs” today are altcoins with sound. You mint a song with a fixed number of digital collectibles on a platform like Sound.xyz. People buy those collectibles, some with the intent of supporting the artist, but most with the intent of hopefully selling them for more at a later date.

This is the same behavior we’ve seen in crypto for ages, whether it was ICOs, DeFi tokens or PFPs. If you’re a trader, the primary reason to buy any token is to trade the metagame.

However, not all collectors are traders. 1/1 marketplaces like Catalog offer an alternative. Royalty-backed NFTs on Royal offer a fixed return.

For what it’s worth - I agree with Cobie. The vast majority of Music NFT volume will likely come (and has come) from semi-fungible token speculation, aka limited collectible songs.

There’s a misconception that Music NFTs are meant to replace streaming. This is incorrect. They are simply a net new revenue stream to provide an artist with additional income on top of the existing system. The more streams a song has, the more valuable the Music NFT should be.

Now - why would anyone buy a token of a song that has no rights? For the same reason people buy CryptoPunks, Bored Apes, and to some degree - ETH. To flex that you have the song (status) and hope to make money along the way (speculation).

Realistically - very very few people care about flexing songs. But, some really do (I am one of them). Prior to web3, my life was as a curator. I found emerging talent, wrote about them on blogs like ThisSongIsSick, and reposted them on SoundCloud. The same behavior still exists, except now I get to collect a token to prove that I actually discovered that song when it was released. In the best-case scenario, my NFTs have been the vehicle through which I formed a genuine relationship with my favorite artist(s).

Now it’s up to us to do something about it instead of talking about how it *could* work.

If you’re looking to show someone what the movement sounds like - I spun up a Music NFT Starter Pack playlist on Spinamp.

Happy collecting!