Why Music NFTs Were The Fastest Growing NFTs In 2022, And What To Expect In 2023.
About 2 months ago, I read an excerpt from this study by Marketcipher stating that the fastest growing non-fungible tokens (NFTs) in 2022 were Music NFTs, and I’m going to do my best to explain why I think that is.
For many people swimming in the mainstream, NFTs are just some overhyped jpeg that someone they know got rich from (and someone else they know lost their house deposit from) but we are seeing Web3 and blockchain technology disrupting a number of industries. For the music industry, this revolution might not be for the reasons most people think.
Music Is The Rebellious Front Line
Music is born from a rebellious desire for change. It’s why teenagers gravitate towards music their parents hate, and why every new generation reinvents their own form of musical expression as a sort of ‘generational language’ that they will use to mark time, interpret encounters and relish the world. It’s why musicians are the gods of each generation, and we love watching them dismantle the anthems of the previous generation, not like we would with grandma’s fruitcake, feeding it to the dog under the table, but in PLAIN SIGHT UNDER BRIGHT LIGHTS, with speakers the size of a car shouting… THIS IS THE WAY!
Music has counter-culture in it’s DNA. It has been at the beating heart of songwriting and stagecraft from the beginning: Hip hop emerging from the graffiti fueled street culture of the Bronx. Illegal techno raves in Berlin. Punk rock in the UK. Napster fuelled piracy. And now… with Music NFTs, where independent artists are putting up the middle finger to the music industry that is strangling them for profit, and releasing music directly to fans.
The Beginning of The New Wave
Almost two years ago, on Feb 29, 2021 Grimes sold an NFT collection that included a new album, music videos, and digital art. The collection sold for over $6 million, making Grimes one of the highest-earning musicians in the NFT space at the time. By selling her work directly to fans through NFTs, Grimes was able to bypass traditional music industry middlemen and retain a larger share of the revenue generated by her music.
But this was only the beginning.
British singer, songwriter, and producer Imogen Heap is another independent artist who has embraced Music NFTs. In 2022, she released a limited-edition NFT collection that included a new album, digital art, and exclusive merchandise. The collection sold for over $2 million, giving Imogen Heap a new way to monetize her music and connect with fans. According to Imogen, she is “using Music NFTs to experiment with new business models and distribution methods that were not possible with traditional methods”.
This type of success story is becoming increasingly common in Music NFTs, and it’s not only huge artists that are getting in on the action. It’s understandable that popular artists entering the space bring considerable fanbase and visibility with them, fuelling the demand for their art. But with the rise of NFT platforms like Sound.xyz in 2022, comparatively unknown musicians are making a good living from MusicNFTs by connecting with their fans in more intimate and meaningful ways.
Artists are discovering that a few hundred true fans and collectors is more powerful than a million mindless streamers.
Why Are Artists Embracing Web 3?
Most artists entering the Web3 space right now have a desire to change the system. A desire to take control of their destiny, instead of letting it be dictated by middlemen in faux hip suits working at record labels and streaming platforms.
That same music industry also controls the flow of revenue, meaning that the fat cats eat first, leaving artists struggling to earn a fair profit from their music, often receiving only a small percentage of the revenue generated by streams, sync rights and merchandise.
With Music NFTs, however, artists can sell their work directly to fans and retain a larger share of the revenue. And for those who have felt the embrace of their fans, the confidence bestowed by true believers, and the support of collectors who have provided them with a sustainable living, there is no going back.
Technology As An Accelerant For Change
Technology has never defined music, but it’s a pretty damn good accelerant. Pour some technology on a hungry and passionate community of artists who want to build a new, more equitable system… and you get a firestorm.
All you have to do is look back through history to see that music culture has often been accelerated by tech breakthroughs. Whether that’s through creative technologies such as autotune or AI, that provide new forms of music creation, or a distribution technology that helps music reach more people.
Just look at what Myspace did for Indie music and emo rock. Or what MTV did for grunge culture. Or how YouTube fueled Lofi. Or even how TikTok is influencing modern pop.
What The World Needs Now
It’s love, right? And something that cures the saturated monoculture that AI is creating on Tik Tok, Spotify and YouTube. That has to be the opposite of love, right? Hearing the same song on repeat.
Might as well sharpen up your fingernails and go find a chalkboard.
Artists need new ways to connect with their fans, independent of the influence of middlemen, and fans need ways to find new music rather than being fed their breakfast, lunch and dinner by algorithms.
In my opinion, that’s why Music NFTs have begun to emerge as a new movement among independent musicians in the US and the UK (and spreading through Europe, Asia and Australia). If you spend about 10 minutes going down the rabbit hole, you’ll see that there’s a movement growing, defined by:
- A passionate community of artists, fans and collectors who are supporting one another in the space. You’ll find them on Twitter spaces and in real life events, connecting with their true fans.
- Music lovers and technologists who are building tools to fuel a new era of artist-fan connection.
- Fans who are being introduced to new artists, attending MusicNFT ticketed events, and discovering a new way to support the artists they already love.
- Musicians owning the full rights to their music, and making a sustainable living from releasing that music. This enables them to release more music, innovate faster and experiment more, leading to… better music.
- Musicians are earning royalties on secondary sales of their Music NFTs. This is possible because the metadata of the NFT contains a record of ownership, and can dictate royalty splits.
Yes, well known artists have capitalised on the hype. But it’s the independent scene, the growing army of rebellious troublemakers who will don the proverbial tight pants and burning suburbs of a new movement. Independent musicians like Peter Saputo, Rae Isla, Sound of Fractures, TK, Pluko, Shark Anthony, Reo Cragun, Sophia Alexa and hundreds of others are already making their mark in the space, and it’s only a matter of time before the battle lines are drawn… between the old guard (record labels trying to jump into bed between musicians and their lovers) and the new.
When George Lucas wrote Star Wars, he understood the power of rebellions to fuel movements. It’s a story trope as old as time, because it is fundamental to the way new ideas gain momentum, and old power structures are toppled.
When Steve Jobs was facing the insurmountable task of getting people to take a company named after a fruit seriously in a battle against industry juggernauts Microsoft and IBM, he tapped into the rebellious few with his ad campaign “Here’s to the Crazy Ones”.
Movements are built from the ground up, and we’re witnessing that in the Music NFT space right now.
Major labels and legacy tech companies are spinning their wheels trying to come up with MusicNFT projects to make them look like the cool kids, but ultimately they are missing the point. The cool kids are busy starting a revolution, and might not be interested in jumping into an abusive relationship right now.
Music labels’ approach to Web3 has not been dissimilar to how they approached streaming, where they initially rejected it because it disrupted their business model before eventually caving in. But there’s an old adage that “big companies only like to play with big companies” and my prediction is you’ll see major industry players try to find other large tech companies to play with in the Music NFT space. We’ve already seen it with Universal and Limewire. We’ve seen it with Warner and Opensea, and I’m sure there are plenty of other examples by now, as the MusicNFT space is gaining momentum.
Not everyone thinks labels entering the space is a bad thing, however. “Currently, I am hopeful because when I see labels entering into this space,” says songwriter and producer Harrison First, who released music on NFT music platform Catalog, “it allows artists to initiate partnerships with labels, as opposed to labels controlling the artist’s earnings and likeness.”
The one thing that mainstream labels have that the Web3 crowd has yet to imitate is cache. Bigger platforms. Bigger stadiums. More reach. It’s hard to compete with that level of cultural dissemination, so we may see a hybrid model in the coming years where music labels provide more control for artists in Web3, in exchange for a spot on the dance floor.
It’s All About The Music
Regardless of where you sit on the MusicNFT revolution, it all comes down to the music. Technology is great, but linking arms and blockchains while we sing Kumbaya is not a foundation for a new world order.
In order to tear down the pillars of the old industry like the streaming platforms did to the mechanical CD sales of old, we need:
- More shit hot music in the space.
- Music NFT driven concerts and events.
- To make it easy for fans to enter Web3.
In Music NFTs we’re seeing: collectives, collaborators, remixes, curators, playlists and journalists all flocking to be a part of something exciting and new, and don’t get me wrong, there is great music in the space. But there is also a lot of underproduced, overhyped music that artists are rushing to release in what could be interpreted as a nascent industry land grab.
To the artists out there looking to enter the space…
Do it.
Do it now.
But put your best foot forward. We need great music in the space. And committed artists, who are there for the right reasons.
This moment in time is about “tearing down the walls that hold [us] inside” to quote a small band from 1988 named U2 (when they were still young and hungry and out to conquer the world). It’s a revolution against centralised silos of power. It’s about musicians keeping control of their own work, and putting energy into the things that matter… the music, the fans and the experiences that make music the defining fulcrum of our generation.
Our generation… Ours.
Music NFTs were the fastest growing NFTs in 2022, and there are signs that this trend will continue, even though the average Music NFT price is dropping (happens to most things as they approach mainstream). But it is likely to only take over mainstream if it starts from an independent foundation where the greatest music, and the artists who make that music, are working in Web3.
Soundnation is an artist-first platform helping musicians make a sustainable living from their music. From releasing Music NFTs as tickets to concerts, to finding sync opportunities, to unexpected collaborations and community building, we’re working hard to help musicians succeed in Web3.
