Have you thought of buying a Music NFT? And, is there a way to buy support your favorite DJ or musician and receive royalties from their music? Music NFTs (non-fungible tokens) and a platform like Royal could be an option for you. Royal, founded by 3LAU, is a Music NFT investments platform. The NFT platform attempts to fix some of the current issues that exist with streaming music while providing financial incentives to music fans.
Music NFT Direct Sales
NFT projects created by musicians support the artist directly with sale proceeds while also providing rewards and benefits to the purchaser. Artists receive proceeds directly from NFT sales. There is no need for an intermediary or third party like record labels or streaming music services.
Fans receive high quality digital art and other exclusive rewards which promote better connections with the artist. Digital collectors can also buy and sell these NFTs on secondary markets such as Open Sea and Nifty Gateway.
How Royal Works
Royal’s business model is slightly different as it distributes profits to NFT holders. This gives music fans the opportunity to participate in the success of the musician. NFT owners earn royalties based on the number of streams through platforms like Apple Music or Spotify. The number of NFTs minted and the percentage of a song’s shared royalties are the artists discretion.
NFTs on the Royal platform are known as limited digital assets (LDA’s). Artists may also offer special rewards to owners of the LDA’s such as exclusive tracks, listening parties, and other fan experiences.
Royal also offers a secondary market for trading the LDA’s. A song or albums popularity will determine the prices of the digital assets. When a secondary transaction occurs, the new owner receives LDA royalties and unclaimed rewards.
Royalties get paid to LDA owners approximately twice a year. Proceeds can be transferred from the Royal platform to a crypto wallet.
How to buy Music NFTs on Royal
Buying NFTs on Royal is a simple process. You will need to set up an account on Royal and fund it from your bank account. Or you can use USDC from your own Crypto Wallet on the Polygon network. Purchasing with a credit card is also an option.
For new drops you need to enter the drop and have USDC or a credit card available. If you miss out on an initial release you can purchase tokens on the Royal platform on the secondary market.
Music NFT Royalty Payments
Before or after you decide to invest in an album or track on Royal you’ll want to have an idea of the potential royalty payments. The platform makes it easy to see past payouts and future estimated payments.
“Don’t Forget My Love” Music NFT by Diplo
Diplo released the single “Don’t Forget My Love” on February 11, 2022.
The LDA’s description page on Royal shows the number of streams and most recent payouts.
Royal also offers a calculator that estimates the annualized royalty payout depending on the number of streams.
Music NFTs Exclusive Extras
Artists can release different tiers of LDA tokens. There were three tiers for Diplo’s “Don’t Forget My Love” track–Gold, Platinum, and Diamond. You can see the price history of the token and the included exclusive extras.
The tracks lowest tier, Gold, had an initial price of $99.00 and 2,000 were minted. The royalty percentage was .004% and there were no additional extras at the drop. However, it looks like there will be access to a Discord channel in the future.
Diamond, the top tier, had 10 tokens minted with an initial price of $9,999.00. Diamond token owners received the highest percentage of royalty payments along with some nice exclusive rewards.
Conclusion
Currently the collection of artists and LDA’s on Royals platform is quite limited. However, the Music NFT ecosystem is in its infancy. This space will evolve over time as artists and musicians begin to adopt web3 technology. If you like music and technology, keep following and learning about music and DJ NFTs. It’s the future of music.