Opulous And The Future Of Cryptocurrency In Music
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Decentralized Finance (De-Fi), a term you may be slowly becoming more and more familiar with, is soaring. With talks of the metaverse, NFTs, and global efficiency, music-oriented De-Fi projects are poised to take the industry by storm. The elevator pitch behind De-Fi is that it is an emerging financial technology that eliminates the middleman. Centralized currencies (for example, the U.S. Dollar) are controlled by the government and have an unlimited supply. In contrast, decentralized currencies are known as lending networks, which offer peer-to-peer borrowing and lending. Furthermore, the top digital coins have a limited supply.
Some may argue that cryptocurrency isn’t backed, but who’s to say the USD is backed. It’s common knowledge that the USD is backed by gold standard, however, think to yourself: is it? It’s not like you can just go walk into a bank and trade your dollars in for physical gold anymore. In comparison, cryptocurrency is backed in a sense by the expensive super-computers required to mine it through solving complex mathematical equations. Recently, there has been an eruption of projects along the lines of gaming, travel, and most recently music being built on the blockchain networks. Blockchains are systems of recording information in a way that makes it impossible to change or hack, which strongly relate to cryptocurrency and decentralized applications which are being built on top of the blockchains. I can go on and on about crypto for days, however, what you are really here for is to get to know a ground-breaking underground-music-related project.
Before we dive into this, it is essential that you are well-versed with NFTs or at least gain a basic understanding of them. NFTs are known as non-fungible tokens. They are extremely controversial, with many arguing that you can just take a screenshot of them, and boom, you own them. Additionally, many people categorize NFTs with digital art, which in a sense is true. In reality, the “art” itself is simply a means to an end, a placeholder asset that shows what the technology is capable of. NFTs are one of the best ways of validating and storing an asset on the blockchain. In the future, activities such as underage drinking will be impossible. Licenses, passports, etc. will all be NFTs. When you go to a bar, you can not use a fake ID as it won’t be verifiable on the blockchain. That’s not to say there aren’t any downsides of NFTs. For starters, most NFTs aren’t environmentally positive as they are bought and sold on the Ethereum network, which takes up energy and pumps out most of it as greenhouse gas emissions.
Connecting back to the utilization of NFTs in the music industry, a project called Opulous is the first platform to launch music copyright NFTs. The main struggle with artists nowadays is capital. In order to gain capital, they need to sell the rights to their music very early, oftentimes resulting in terrible record deals. For example, you’ll see new artists who have a song blow up but need money to create and promote music videos, go on tour, etc., and will then sign to a major record label that takes the rights to their music.
An analogy I can make is an artist sharing that they’ve received hundreds of thousands of streams on a particular song and have only received a few dozen dollars for it which is a current phenomenon around the music industry. There are many artists stuck in deals where they may be earning tens of thousands but the majority of that capital goes to their label who own full ownership of their music. Opulous is the clear-cut answer to the issue.
With Opulous, artists’ historical data will be analyzed, and they will look at what the artist will be earning in the subsequent years to come based on the data. Opulous will then issue the artist a low-interest loan, and the artist gets to keep 100% of the rights to their music, which is extremely valuable long term considering the 11-figure sales that legacy acts have made selling their masters to labels recently. Opulous has its own token which cryptocurrency users are able to purchase and use to invest, to show their trust and faith in the company.
As far as NFTs, using Opulous, an artist can split the ownership of their music into however many pieces they want and sell them directly to their fans. The incentive for the fans is that the more successful the artist is, the more money the fan makes, which directly correlates with the underground music industry. Users can find NFTs from underrated artists that they believe have potential and invest in them directly helping themselves and the actual artist. Not to mention, as opposed to many De-Fi projects built on Ethereuem, Opulous is built on Algorand’s blockchain where there is no need for proof-of-work energy-intensive mining, meaning that the network is extremely environmentally efficient as well as requiring a minimal amount of computational power or electricity.
It is worth mentioning that there are also other concepts that could benefit artists even more, such as Bandcamp. Bandcamp allows artists to sell their work for over 80% of the profits without the environmental and social downsides of NFTs. One downside of Bandcamp is its actual music discovery section. The “browse by tags” option is very clunky, and it feels impossible to find actual new tracks as there’s no option to sort by new releases. Not only does Opulous on the other hand, offer a clean, more simplistic take on music discovery. But, users also gain royalty earnings throughout the year which directly benefits both parties. On Bandcamp, users are able to purchase tracks but receive no benefits from it other than being able to listen to the track, which let’s be real - most people just stream music on Spotify and Apple Music these days so there is no real incentive for an artist’s more casual listeners to purchase music on Bandcamp. Opulous gives artists 100% of their music’s streaming and purchasing profits as long as they pay the initial loan off, which in the long run is much more rewarding to the artist.
With all projects in general, it is important to do your own research and use your own intuition on services before optimizing them. Take Hitpiece for example, the shady music NFT marketplace that has recently experienced its own negative backlash after being exposed for listing artists' songs as NFTs without their consent. They allegedly used Spotify’s API to steal info on artists and then uploaded them on their site. I can not stress enough how crucial it is for you as a user to do research before going all-in on something. Take everything you see with a grain of salt and use your instinct when you see clear red flags, especially in an unregulated industry currently riddled with scams.
In the coming months, it will be interesting to see Opulous take a leap of faith in the Music business. Moreover, I strongly encourage you to take a deeper dive into Opulous and get a better sense of the ins and outs that the project has to offer. Who knows; maybe you or an artist you know will be the next investor.
Written By Eli Grehn
