Most people think of visual art when they think of NFTs. Beeple's $69 million sale of a digital collage at Christie's was the most prominent use case for NFTs due to close similarities with traditional fine art investing. The fact that digital art can be viewed and replicated online has led to some confusion among consumers.
I saved the image to my laptop and used it as my background. It makes other people look foolish if they can prove that a real owner is on-chain.
3LAU, as he is known, co-founded Royal, a startup that uses NFTs to allow users to buy shares of songs through its marketplace and earn royalties. Less than three months after bagging $16 million in seed funding, the company raised $55 million in a Series A round.
There are two things that represent NFTs sold on Royal. The emotional value of owning something that is associated with your favorite artist is represented by them. The utility in use cases for NFTs is not the same as the form factor of those NFTs.
It wouldn't make sense for music NFTs to be applied the same way as NFTs for visual art because music is invisible.
It is not a commoditized type of asset. The only other way to collect music in the past was with CDs and vinyl, and now with a streaming service. Everyone has the same music collection. You get access to everything if you pay the subscription.
If a behavior exists in reality and can be replicated in the digital world, it will likely be a successful use case for NFTs. He said that if a behavior doesn't exist, it probably isn't the best one.
The music example is the most interesting because no one would do that in the real world.
At Royal, Blau and his co-founders decided to apply NFTs to the copyrights of the behind songs. The audio itself, which can be streamed by any user, is not the copyright of a song.
He said that about 80% of all income is generated by music. The reason artists don't make a lot of money is because record labels take a cut, not because streaming isn't lucrative.
He said that he turned down a deal that would have paid him $15,000 for 50% ownership of his song, "Is It Love."
Fans probably would have given me a better deal. If that song had succeeded, they all would have had some sort of return, both from a pure asset value appreciation standpoint and from a cash flow standpoint.
Digital asset holders will eventually be able to engage directly with artists and access exclusive perks on Royal's platform.
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