What You Need to Know About NFTs in Music
By now many of us are at least a little familiar with what NFTs are. The initials stand for non-fungible tokens. They are unique digital identifiers that cannot be copied or substituted. They are recorded on a blockchain which is used to confirm authenticity and ownership.
In the past, NFTs were mostly works of physical art. If a person saw an NFT piece of art they liked, or that they thought might increase in value, they would purchase it. They would have the exclusive rights to their purchase. They also had the option of selling their purchase in the hopes of gaining a profit.
Now NFTs are moving into the world of music. The concept is basically the same, but as opposed to an art NFT that has a visual element only, a music NFT has both a visual and audio element.
This article will discuss music NFTs and how you can use the medium to your advantage.
Who Owns the Rights to Your NFT?
When it comes to music, rights are very important. When someone owns an NFT, they own the piece of art. So, do they also own its rights?
When it comes to NFTs, different rules apply depending on the stipulations worked out by the artist and the owner. Typically, a smart contract is put in place that includes rules about what the collector can and can’t do after they purchase the work.
Most creators will limit rights so the buyers can only “use, copy, and display” the NFT. However, they cannot use it for commercial purposes.
If there are no guidelines in place regarding the purchaser’s rights, the license will default to a personal license. This means the collector can use the item on social media or for personal use in their home. However, they cannot use it to make a profit.
If a commercial license is worked out, the buyer will be able to use the NFT to earn an income, but they will typically have to pay royalties to the artist
How Music NFTs Are Changing the Industry
The landscape of music NFTs allows fans and artists to create a mutually beneficial relationship, not that different from a record label deal.
If the fan believes in the artist, they can buy their NFT giving them much needed income to further their careers. In return, the fan has an opportunity to make money off the artist by selling their property. In this way, the fan acts as a stakeholder in the artist’s career.
As a bonus, NFT’s don’t include the exploitative elements that are included in many record deals. Artists have the freedom to conduct their careers as they wish. And they also have the benefit of the income they are making off their NFTs.
NFTs are also a good alternative to crowdfunding campaigns. Unlike a crowdfunding campaign where the artist must give something back to donors, the NFT itself, and the possibility of a profit, are their own reward.
Builds a Sense of Community
NFTs forge a personal connection between the artist and the fan. Unlike a shirt or another type of merch, an NFT is a unique product that only that fan can own. This gives them a sense of exclusivity and of being in the artist’s inner circle.
Many artists enhance that exclusivity by providing the buyer with special perks such as fan club memberships, meet and greets and special promotional items.
What to Offer in an NFT
I know what you are wondering… what can musicians offer in NFT format? An album? A video? And if NFTs are supposed to be unique, what can you provide that will not be offered to anyone else?
Let’s take a tip from Kings of Leon, one of the first bands to release an album in NFT format.
Their album, “When You See Yourself” was offered as an NFT that could be exchanged for a $50 token. Those that purchased the token would have access to the album package with a vinyl and digital download.
It was made available for a two-week period. After the two-week period was over, no more NFT versions of the album were available.
Those who purchased the NFT could also be eligible to bid on a one of six “golden ticket experiences”. Winners get four front row seats to the show of their choice during each tour for life.
The campaign was highly successful. It generated over $2 million in sales $500,000 of which was donated to the Live Nation’s Crew Nation to support live music crews during the pandemic.
DJ, record producer, music programmer, and record executive Steve Aoki also jumped on the NFT bandwagon with his 2022 creation AoK1VERSE. Users can join by buying an NFT passport which includes two free tickets to his live shows, free merchandise, and access to members only events and performances.
Other artists that have been successful in the NFT space include Snoop Dogg, Eminem, and Nas.
How to Sell an NFT
Once you decide what your NFT should be, you are ready to create it and upload it on the blockchain. Here are the steps you will need to take.
Create Your Music and Upload It: Obviously, there are various ways to create and record your music, so you can figure these steps out for yourself. However, it’s important that the files you create are high quality. Otherwise, people may not buy it, or they may be disappointed when they buy it.
Label Your Tracks Correctly: You can use various methods to label your songs. However, organization will be necessary so you can keep track of them on the blockchain.
Include Cover Art: The cover art you include must be at least 600 x 800 pixels in size. Like the music, it’s advisable that the art is high quality… especially considering that NFT buyers tend to have an eye for art. If you are unable to design a nice-looking cover, consider hiring someone that can.
Encode Your Music as an NFT: There are several ways to encode your music, but BitShares Music Blockchain is recommended as it is easy to use at it allows you more creativity. Here are the steps you will need to take:
- Open the BTSM Wallet and click ‘create new asset’. You will be prompted to come up with a name for your asset, then hit ‘create’.
- Choose an Asset Symbol: This can be the same name as you use for your cryptocurrency. It’s best to use a name that’s short and easy to spell.
- Description: Enter a brief description of your music.
- Upload File: You will need to upload the file containing your music.
- Click ‘Endcode Asset’: This will encode your music into an NFT format and add it to the blockchain.
Next, you will need to find a platform that you want to use for your NFT distribution. There are several out there and we will review them in the upcoming section. But once you’ve found a platform you prefer, you will need to take the following steps.
- Create a Wallet: If you don’t already have a cryptocurrency wallet, you will need to create one. You can do this on MetaMask or any other crypto wallet platform.
- Mint Your NFTs: Minting involves submitting and verifying your soundtracks on the blockchain. The process is relatively straightforward. Most platforms will have an option to click on “Mint Your NFT”.You will be taken you through the steps from there.
- Choose the Way to Sell Your NFT: There are several options for the way you want to sell your NFT. You can use a declining price listing which will fall over time, a fixed price listing which will stay the same, or a bid structure which allows people to bid on your work.
- Chose a Price: The price you put on your music should account for all the hard work you put in. But it should also be reasonable enough that it will make people want to buy or bid. If you are using a bidding platform, you may want to start with a low price to entice bidders. Once someone sees bidding has begun, they may be tempted to follow suit. However, this can also backfire on you so make sure your pricing allows you to make back your money at the very least.
What Platform Should I Use to Sell My Music NFT?
There are several platforms that you can use to sell your NFT. Here are a few that are recommended.
OpenSea is the largest marketplace for digital assets, and it has a marketplace specifically for music NFTs. It also allows musicians to customize their NFTs so they can make money off secondary sales.
Here are some fast facts about OpenSea:
- Launched in 2017
- Supports Ethereum, Klaytn, and Polygon blockchains
- Has over 30.4 million monthly platform visits
- Has a large community on Twitter, YouTube, Instagram, and Discord
In addition to functioning as a music streaming and sharing site, Audius is also an NFT marketplace. It offers a streaming service where artists can sell NFTs to generate revenue.
It also allows artists to engage with fans, share original work, and offer exclusive bonuses to collectors. Users can also link their music NFTs on Solana and Ethereum.
Zora describes itself as a “universal media registry protocol”. Artists can use it to publish and monetize their creations. Unlike other crypto sites, it uses a single unique token that can be used by anyone. It can be resold allowing the holder to generate revenue.
It also offers instant cross-platform royalty payments with zero fees. It provides a superior toolkit for NFT creation.
Other features include:
- Launched in 2020
- Supports Ethereum and Zora Protocol blockchains
- Supports ETG and wETH payments
- Has over 110,000 monthly visitors
- Has a large community on Instagram, Twitter, and Discord
Mintable lets users mint their digital works on the blockchain for free. It is also very easy to use. Features include:
- Launched in 2018
- Supports Ethereum and ImmutableX blockchains
- Supports ETH payments
- Has over 229,000 monthly listeners
- Has a large community on Twitter and Discord
Rarible is one of the oldest and best platforms for the trading of music NFTs. It is owned by its community allowing those who hold the digital RARI token to call the shots. The platform charges 2.5% for every sale and allows artists to make up to 10% in royalties. It also allows users to pay with a debit or credit card.
Other features include:
- Launched in 2020
- Supports Ethereum, Flow, ImmutableX, Tezos, Solana, and Polygon blockchains
- Supports cryptocurrencies, stable coins, and credit cards
- Has over 9.7 million monthly visitors
- Has large communities on Twitter, Instagram, YouTube, and Discord
PlayTreks is an AI analytics platform and NFT marketplace that has been growing in popularity. It provides artists with industry-related data, licensing control, radio airplay analytics, free music distribution, and access to the NFT marketplace.
Artists can take advantage of actionable insights from social media and streaming platforms so they can make better decisions for future releases. They can also get digital proof of ownership for their songs through the platform’s blockchain based NFT marketplace which allows you to mint music so you can convert it to an NFT.
Other benefits include:
- Launched in 2021
- Supports the Polygon blockchain
- Has over 5,000 monthly platform visitors
- Has a large community on Twitter, Instagram, LinkedIn, Facebook
Catalog is one of the best NFT marketplaces for launching single edition music NFTs. It is unique in that it allows artists to mint and release the single edition of a music token making it a great place to purchase collectibles.
The platform allows artists to add a record or song to its open music library and set a ‘buy it now’ price. Artists can list their NFTs in a reserve auction offer made by a collector. They can also control their resale prices, keep all the revenue from their first sale, and get a cut of the profits off subsequent sales.
It also serves as a streaming service for users who have bought music off the platform.
The platform is currently invite-only, and it is likely to remain that way until the small team that runs it completes the onboarding process. Artists can fill out a submission form to get on the waitlist.
Other features include:
- Launched in 2021
- Supports the Ethereum blockchain
- Support ETH payments
- Has over 32,000 monthly visitors
- Has large communities on Twitter, Instagram, and Discord
This platform serves as an NFT marketplace and a streaming site. It allows artists to host events for the tracks they are releasing. Their tracks are assigned unique numbers. Fans can purchase them to show their support. The early tracks benefit fans as they are higher in value.
Sound.xyz stands out as it allows fans to comment on the tracks they endorse. It’s also the first platform to offer artist-owned contracts that allow creators to retain ownership and a chain of custody on their works.
Royal allows artists to retain the rights to their creations and decide how much they want to get in royalties. It puts artists first making it a popular marketplace choice.
It also lets artists offer fans special perks like fan experiences, exclusive tracks and digital art. Artists can also share the control of their tracks with owners and collectors. So, if you’re a collector, you may get a portion of secondary sales.
The site accepts debit and credit cards making it convenient to use. It is invite-only.
Other features include:
- Launched in 2021
- Supports Ethereum and Polygon blockchains
- Supports ETH, Matic, credit and debit cards
- Has over 54,000 monthly visitors
- Has large communities on Twitter, YouTube, Instagram, and Discord
Market Your NFT
Just like any other type of music format, you will need to market heavily to get your NFT noticed. Here are the methods you can use.
Social Media: When it comes to social media, the possibilities are endless as there are so many platforms available. You will have to create materials in accordance with the platform formats and requirements. However, it’s smart to include a link back to your NFT as well as a preview so people will know what to expect when they purchase it.
Online Music Platforms: You can also use music platforms to market your NFT. Soundcloud and Spotify are especially useful. Soundcloud will allow you to create a profile for your NFT and upload your tracks so they can be streamed by Soundcloud listeners. Sign up for Soundcloud Pro or Premium to make money off the listens.
Forums: You can post on forums like Reddit to get the word out about your NFT. In fact, there is a specific forum, r/CryptoMusic, that is designated specifically for this purpose. The community is for people interested in crypto and music, so you are likely to generate some interest with your posts.
Music NFTs are revolutionizing the music industry. Now that you know what’s involved, you can decide if it’s the right move for you to make. We wish you the best of luck in your endeavors.