NFT-based music streaming projects are expected to launch in 2022 , Including Audius a blockchain music platform supported by Justin Bieber, Katy Perry and The Chainsmokers.
Apple Music and Spotify reportedly take 75% of musicians’ earnings along with a cut for labels. Saxo Bank predicts that as streaming services like Spotify cut much of musicians’ revenue, new technological advances like nonfungible tokens (NFT) will help artists grab back their fair share.
Music creators will benefit from NFT-based streaming platforms, stated one of Saxo Bank’s “Outrageous Predictions 2022: Revolution,” because they enable distributing music directly to listeners without relying on centralized intermediaries. Cryptocurrency analyst Mads Eberhardt of Saxo Bank said music streaming services such as Spotify and Apple Music take a substantial cut, which is about 75% or more of total revenue, together with the cuts paid to record labels.
“The use case for NFTs could prove particularly compelling in the next step for the technology for content generators in the music industry as musicians feel unfairly treated by the revenue sharing models of the current streaming platforms like Spotify and Apple Music.” - Eberhardt stated
According to analysts several NFT-based music streaming projects are expected to launch in 2022 , including Audius, a blockchain music platform supported by Justin Bieber, Katy Perry and The Chainsmokers. The Audius platform to utilize blockchain technology to facilitate decentralized music-sharing and streams in order to reduce intermediaries in the music industry and enable direct interaction between fans and creators.
The future of traditional streaming services like Spotify, on the other hand, seems bleak, according to Saxo Bank. The bank predicted that Spotify shares would fall by 33% in 2022; SPOT has been dropping throughout the year, starting out around $300 and dropping as low as $204 by the end of August according to data from TradingView. At the time of writing, SPOT is trading at $229.
Spotify’s revenues have steadily grown over time, reflecting the potential for NFT-based music platforms to disrupt the market. Last year, Spotify generated 7.85 billion euros ($9.5 billion) in revenue, an increase of 16% from the year before. Spotify’s financials continued growing in 2021, with the total amount of monthly active users surging 19% year-on-year to 381 million in Q3 2021.
Spotify has been on the lookout for talent with a cryptocurrency background, as reported earlier this year. Spotify is also aware of the emergence of NFTs, as mentioned in its Wrapped 2021 presentation published to its users on Wednesday.