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Cryptocurrencies: How Will They Disrupt — And Improve — Music Royalties?
Cryptocurrency's prospective influence on the music industry is as exciting as it is mysterious. So what will these blossoming digital formats mean for royalties when it gets down to brass tacks?
"Tech has already revolutionized how music is made, discovered and consumed. I think the next disruption is going to be with royalties, and how musicians will be able to get more direct, and better, pay through cryptocurrencies and other digital transaction services." — Conversations in Advocacy #2
While the concept of cryptocurrencies may be new to some, there is no shortage of entrepreneurs who have been paying close attention to the movement and devoting time and resources to building music platforms that can utilize the technology.
Choon, one new service coming in spring 2018, promises to implement the Ethereum blockchain technology to ensure royalties are immediate and accurate.
Choon is essentially a streaming service that will allow fans to purchase music using NOTES, a proprietary cryptocurrency that can be collected and distributed fluidly from fan to artist, returning 80 percent of revenue to the copyright holder(s) to be divvied up based on a "smart record contract" set up ahead of time.
At launch, NOTES will cost the listener 5 cents each and can also be earned by creating popular playlists, listening to promoted songs, and providing useful feedback, according to Billboard.
"There's this common misconception that there's no money in music, and that the only way you can make a living is touring, but that’s not really correct," said Choon co-founder Gareth Emery. "It's a $16 billion industry. What I realized though, was that the money is going to all the wrong people: intermediaries and middlemen who don't really need to be there. Choon is our attempt to fix these problems, cut out these people, and provide a much better deal for artists."
Another service shaking things up is Monero, an open-source cryptocurrency launched in 2014 that boasts a music catalog of more than 30 artists, including G-Eazy, Weezer, Motörhead, Kaskade, and Fall Out Boy.
"Unlike many cryptocurrencies that are derivatives of Bitcoin, Monero is a unique protocol," Hypebot said of the service, while adding that it "focuses on privacy, decentralization, and scalability."
With buy-in from major artists and a major holiday initiative dubbed "The Coral Reef Project" teed up to raise awareness of Monero, the service is pushing hard against the floodgates, hoping music consumers will open their minds and wallets to this new way of supporting bands and artists they love.
These two examples represent real-world implementation of the technology primed for disrupting an industry already in flux, and the best part is that artists, musicians and songwriters stand to reap the rewards.
"Conversations in Advocacy" is your weekend digital tip sheet on the policies that affect music makers and their craft. New installments post every Friday.