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NFTs are a tool in a musician’s arsenal. Behind an NFT’s ability to give artists continued streams of royalties is a smart contract. Smart contracts (programs that are written and deployed to a public blockchain) present a novel way of ownership, financial opportunities and connections. Given that the nature of music-making is highly collaborative, smart contracts are particularly useful in fairly splitting royalties amongst all contributors, allowing them to be paid instantly.
The bull case for music NFTs is also supported by the stats: last year, music NFTs generated over $80 million in primary sales (Water & Music). NFT holders, as opposed to record labels and companies, are stakeholders in a musician’s success. This can unlock more creative freedom for musicians as @cdixon pointed out, artists are “fully liberated from the structures of a conventional corporation”.
NFTs open up direct monetization for musicians, which can give them further autonomy to concentrate on their craft and create for their most passionate fans. Focusing more on “quality” over “quantity”. However, not all fans will be happy. From BTS to Charli XCX, musicians with large fan bases have faced backlash at the announcement of an NFT venture. This obviously isn’t good for mass adoption, where prominent musicians play a pivotal role in onboarding non-web3-native folk.
For upcoming musicians, NFTs can have the ability to lower the barrier to success. As we are part of a niche internet community, such creators could make a fair living by reaching a small group of passionate fans. This is potentially achievable for artists of all sizes. One musician earned more than his monthly salary as an EMT through royalties, just in the first week with PixelBands. PixelBands is a Solana NFT project that allows artists to experience on-chain music and reap its benefits. Through PixelBands, partnered musicians (who create an 8 bar stem that represents a PixelBands NFT) have their wallets coded directly into the smart contract and earn 5% royalties anytime an NFT with their music sells. To date, PixelBands artists have earned over $68,000. According to grammy-nominated producer Wuki:
By comparison, although there are around 8 million artists on Spotify, only 0.7% of artists account for 90% of artist payouts on the platform. A musician earns $0.00437 per stream. If you’re a big-name artist, the numbers add up and your name carries weight beyond streaming music. But, if you’re just starting out… it’s a different story. This model of streaming places an artificial cap on a musician’s capacity to earn and it makes it hard for emerging talent to “succeed”.
🎶 NFTs present new opportunities in the music industry
For Wiens of PixelBands, “the ability for musicians to put their music on-chain might be one of the single most exciting things that have come about in the music industry in a long time”. It’s exciting because it has the power to disrupt traditional methods of monetization and fan interaction. NFTs to Wuki allows for “another layer of creativity and world-building” and for those with a strong brand, they can “build out a story that is metamorphic using NFTs”.
Although the future of music is shifting, there are obstacles to overcome, like fan acquisition and retention. Wuki’s latest project, Wobblebug seeks to help musicians with exactly this: building a community and loyal fan base. His idea brings the tried and tested PFP format into the realm of music NFTs. “I think using the PFP format allows you to reverse engineer a musician’s career. After you mint, you instantly have 1000+ super fans that want you to succeed and share in your success.”
🎧 Music NFTs enable fans to directly invest in the artist they believe in and in return, they receive:
- Proof of patronage: NFTs are a means to support creators and invest early in their success. In some cases, an active investor could earn royalties on their investment and have a piece of the secondary pie. NFTs make it a two-way street.
- Proof of ownership: NFTs are a new medium for collecting music. What the vinyl was to the 1950s, NFTs are to the 2020s. It’s the vinyl of our time. Certain copies are priceless.
There are other incentives to being a fan. Audius, a decentralized streaming platform on Solana recently rewarded listeners with over 100,000 $AUDIO (~$82,293). Web3 offers a way for creator monetization to be aligned with fan incentives and allow them to share in the upside. Collectors would be incentivized to share in the goal of maximising their shareholder value.
👀 So, will NFTs remove the need for the Web2 music industry?
No, it won’t but NFTs are part of the evolving future of music. “The traditional music industry is a love-hate relationship. I still think musicians will have to utilize web2 until a more comprehensive web3 platform exists. But, there are really cool ways to gain exposure in both worlds if you are clever!” Wuki shares.
NFTs circumvent traditional music industry standards by enabling a direct-to-community approach. Through daily Twitter spaces and multiple Discord AMAs, musicians aren’t just focused on their craft, they’re also community managers, connecting with fans and collectors at a micro-level. For some musicians, this works marvellously. But others may just want to make music. That’s also okay.
On the other hand, fans may prefer traditional streaming platforms and may miss the point of NFTs, which @rac states, is to “make content free while ownership scarce”. Streaming on Spotify, for example, creates an infinite amount of content which inadvertently devalues a musician’s work since it’s attached to a minuscule monetary value. Musicians may choose Spotify because they’re a titan in the music streaming industry and see it as a way to increase exposure. But, it’s not a fair trade.
Free content means that web3 unbeliever fans can still partake in listening to music but, scarce ownership means that super fans become active participants in their patronage. NFTs offer an alternative path to the one-size-fits-all music solution that we’ve all grown accustomed to and accepted. Web3 gives artists options beyond exploitative streaming models and new avenues for connecting and cooperating with their fanbase.
We’re bullish on the fact that NFTs can build a fairer, more creative and collaborative future of music where musicians and fans come first.
🪄 About Magic Ticket Drop
We recently finished airdropping ~30K Magic Tickets to our community. If you have questions about our drop, please visit our blog post here. For those who felt like they should have received a ticket, we hope that this article helps you out! We are still working through our DMs with folks who felt like they should’ve received an airdrop. If you are reading this email and feel like you should’ve gotten an airdrop (trade within 1 month of 2/21, connected discord + email by EOD PST 2/22), please write to our help desk.
In total, we dropped over 30,602 tickets. Breakdown as follows:
- OGs - 6,348 tickets (21% of the drop)
- Degens - 7,162 tickets (23% of the drop)
- Normies - 17,092 tickets (56% of the drop)
🪄 How to join MagicDAO
Have you received a Magic Ticket but you’re not in the MagicDAO yet?
Magic Ticket is your exclusive invite to MagicDAO, a special section of the Magic Eden discord. Watch this video or follow the steps below to join or follow the steps below!
Please find the "verify MagicDAO" section of the Magic Eden discord and select "│how-to-verify-magicticket".
There will be further instructions there as follows:
HOW TO VERIFY YOUR MAGIC TICKET NFT FOR ACCESS TO THE DAO:
- Head to https://magiceden.io/me
- Connect the wallet that contains your Magic Ticket
- Link Discord account
- Head to the │verify-magicticket-nft channel and type /verify-magic-ticket
Join our Twitter Spaces today
See you at our Twitter Space today at 9 pm ET to walk through our litepaper!
🪄 Magic Ticket + MagicDAO Roadmap Litepaper
We see Magic Ticket and MagicDAO as both long term plays for Magic Eden with multi-year roadmaps. They are our way of offering our community ways to engage with us as we build out proposals and programs that give back to the community. In the coming years, we plan to invest significant time, resources and effort into growing these initiatives. More about our 3 pillars (social, governance, rewards) in our litepaper!
🪄 A Short Flex
Magic Eden went from zero to 95%+ market share (based on secondary trade volume) in just 6 months. We know we are nothing without our creators and are grateful so many collections have chosen us as their home. Thank you for putting your trust in us.
The growth we’ve seen is extraordinary for our collections and the Solana ecosystem as a whole:
- Magic Eden has 21.6 million monthly user sessions (90%+ growth Jan vs Dec), and 2.6 million monthly unique wallet connections
- Magic Eden acquires ~3,000 new wallets to trade with us daily
- On average, a user’s unique session spends 12.8 minutes (more than TikTok per session) and visits 15.2 pages
🪄 Congrats, this week's top performing collections on ME! (2/22-3/1)
