A Rockstar Guide to NFTs
A rare guide to scaling profits using NFTs — A must read for every musician & creator!
So, here’s a quick peek into how juicy (and profitable) Non-fungible Tokens (NFTs) are for music creators.
In February this year, Grimesmade a whopping sum of $5.8 million auctioning digital art pieces in just 20 minutes. That very same weekend, popular electronic musician, 3LAU, sold $11.6 million in Non-fungible tokens.
Now, that is insane money!
Even as some in the music industry debate why digital content is sold as NFT tokens, the fast-action takers have been jamming this opportunity.
In the past, musicians have faced piracy and plagiarism, which ultimately reduced earning potential as creators. Now, the tables have turned.
NFTs. What are they?
In simple terms, NFTs are digital certificates that provide proof of ownership and a badge of authenticity. Despite the ease of copying and distributing digital content, when a customer buys NFTs, they get proof of ownership for the particular NFT purchases, regardless of the number of existing copies.
Think of it this way: you write a track using a DAW. You release a copy of the master. You add the album artwork to that copy. You might even add in a digital photo of the handwritten lyrics of your track. Combined, they become "NFT V1.0". You can then sell that content to your fans.
While there may be thousands or even millions of copies of that content available on the Internet (because of some very cool technology called the "Blockchain"), there will only ever be one "NFT V1.0".
In a sense, NFTs create a perception of artificial scarcity. The artwork itself isn't rare, but the certificate of ownership (called a "token"’) is, making each NFT unique.
NFTs are changing the status quo.
This is crazy!
Industry stats have revealed that most musicians only receive 12% of the profits derived from the sale of the music. And that’s only after record labels, management, agents and everyone else has taken their cut.
NFTs are a new way for you to profit from the sale of your works.
During the pandemic, NFTs became popular as musicians made money through this media even while touring was impossible. With NFTs, you can reach a global audience without moving an inch from your home studio.
NFTs operate on the same Blockchain technology made popular by cryptocurrencies Ethereum and Bitcoin. The Blockchain provides a trusted ledger payment proving ownership of a digital asset.
As an artist, you can even receive a guaranteed share in any secondary sale of your work. So any time the NFT you created is resold, you can receive a cut of the sale. You don’t have to chase anyone for the money. The Blockchain ensures that you will be paid every time your NFT is sold.
It is a game-changer!
Making a Music NFT is easier than using Abelton®!
There are several platforms on which any musician can make their own NFTs such as OpenSea and, Rarible.
Here are the steps:
- Got to a platform website
- Click on "Create" on the user interface
- Select the type of collectible you wish to create; single or multiple
With single collectibles, you'd be able to mint (read make) one-of-a-kind NFTs and will have to pay a one-time minting fee. With multiple collectibles, you can release many copies of the same NFT.
Going back to the example above, you might create NFT V1.0, NFT V1.1, NFT V1.2, and so on.
After you upload your file to the platform, you then need to fill in details such as:
- Title and description of the artwork
- Royalties you would like to receive on secondary sales
- Properties of the music and art file, e.g., size
- The price you would like for every NFT sold.
When you're all set, you can proceed to connect a trusted digital wallet so you can get paid. Finally, in order to set your NFT live on the platform, you will need to pay a certain percentage to the platform/marketplace.
Now that you’ve created your NFT, here’s how to list it on a notable marketplace (these marketplaces are just like eBay except that they sell digital goods).
Listing Your Music NFTs for sale
You can adopt three methods to list your NFTs.They are:
- Highest-bid auctions:
NFT platforms provide musicians with the option of selling to the highest bidder. So, you can select a starting price, set a duration, and sell to the person with the highest price, just like eBay.
- Fixed-price listings:
All you need to do is select a fixed price for the NFT and set an expiration date for its sale.
- Declining-price listings:
This method enables you to sell above market price. You set a start price and an end price, and you fix a sale duration in-between to keep your ready-to-buy audience engaged.
Promote Your NFT for sale!
Can you get the same visibility as the big shots of the music industry? Yes! This is possible with the NFT platforms.
You can add incentives for your fans when they help you promote your music and make a sale. The goal is to get your fans engaged, hopefully, enable your music NFT to go viral, and give them some form of rewards like show tickets or backstage passes. Like anything you sell in the real world, the more people see the thing you are selling, the more likely it will sell. And, hopefully for a higher price too.
In a nutshell!
NFT’s are super easy to create, promote and distribute.
Jump on board as quickly as you can. You deserve to get paid for your genius!