Why Should The Music Industry Care About NFTs?
What Exactly Are NFTs?
To put it another way, an NFT is similar to a digital registration certificate. By definition, digital artwork may be replicated and transferred quickly around the globe. However, purchasing an NFT demonstrates to the client that they own whatever they’re collecting, regardless of how many digital versions exist. NFTs, which originated in the area of visual art, generate a false feeling of scarcity — the token, not the artwork, is scarce. As a result, the tale of NFTs is as much about business as it is about music. What becomes of them will be determined as much by the whims of capital markets as by creative genius. The spectrum of uses for the music industry is extensive but sometimes tangential: Grimes sold photos of infants carrying spears across space, occasionally accompanied by excerpts from her music, while other NFTs provide unique record bundles or live performance benefits to their purchasers.
Why Are NFTs Gaining Popularity At The Moment?
To begin, it’s worth noting that numerous sorts of investments have lately reached or exceeded all-time highs, yet others have fallen just as swiftly. For years, yields on US Treasury bonds were at record lows, making stocks as well as other types of assets more appealing to entrepreneurs, hence driving up prices. Bitcoin has also been breaking records. Day traders are boosting the value of stocks of firms such as GameStop & Rocket Mortgage, but these gains have also been mostly fleeting. Even trading cards have reintroduced themselves to investors in recent years. NFTs may also be a sign of market exuberance and volatility.
What Musical Predecessors Do NFTs Have?
In contrast to visual art, music has a clear historical precedent for the kind of transactions that NFTs promote, with a single customer paying the high cash for a unique and rare piece.
However, since streaming has made it more difficult for many artists to earn a living from their records, a handful of artists, particularly in hip-hop, have experimented with fake scarcity in recent years. The most infamous example is Wu-Tang Clan’s one-of-a-kind 2015 album Once Upon A Time In Shaolin, which was purchased by pharmaceutical mogul Martin Shkreli prior to his seven-year jail term and government decision to relinquish the record. Several other rappers, like R.A.P. Ferreira and the late Nipsey Hussle, also paid a premium for limited-edition physical copies of records that are freely accessible through streaming sites. Additionally, there was also some of Kickstarter & Patreon in 3LAU’s NFT auction, which featured the opportunity to partner with the DJ, demonstrating the way artists have utilized crowdfunding sites to charge for access to their creative processes.
Which Artists Are Responsible For This?
The musicians that have had the most success with NFTs thus far have pre-existing links to the ardent crypto community. However, other people have been experimenting with the format. Deadmau5 began selling NFTs for digital stickers last year. Other prominent artists, like Linkin Park’s Mike Shinoda, Kings of Leon & Shawn Mendes, have also jumped on board. Recently, the Man said, “cryptocurrency is the new rock’n’roll.”
Additionally, Disclosure premiered a song via Twitch & sold it as an NFT this week. To push the platform’s capabilities even further, Canadian musician, Jacques Greene, used NFT to auction the publication rights to a new tune.
How Are Individuals Able To Spend Millions For Just A Digital Token In The First Place?
While NFTs are causing quite a stir, the splashy sales-generating headlines are clearly out of reach for those impatiently awaiting their COVID-19 relief payments. Until now, NFTs have been considered a luxury item reserved for the rich. The NFT realm is definitely a reflection of the economic dynamics of the art and technology world that created it, with all the associated class, racism, and other baggage.
Despite This, Could NFTs Pave The Path For More Prosperous Financial Prospects For Artists?
For music fans, the most hopeful scenario for NFTs is that they will provide artists with the economic power they had in the most recent incarnation of the internet. Mat Dryhurst, a digital artist, has been making similar points on his podcast alongside Holly Herndon. David Rudnick, a graphic artist who has traded NFTs, recently tweeted:
However, despite the hopeful notion that NFTs are democratizing access to riches for artists, they have so far resulted in the creation of a few more single winners and not a change in the game’s laws. Does Grimes’ new $6 million fortune mean anything at all to the ordinary struggling artist?