PublishedTue, 18 May 2021, 09:00
- Cherie Hu's research into the booming crypto-trend shows how already successful artists make the majority of profits.
Music tech writer Cherie Hu has published a document compiling research into the music NFT market.
Hu's analysis was based on data derived from monitoring 20 NFT marketplaces between June 6th, 2020, and April 25th, 2021. Marketplaces such as Zora, SuperRare, Curio and Rarible raised millions in venture capital funding in March and April of this year as investors rushed to capitalise on the boom in crypto collectibles.
Despite NFT music sales grossing $60.2 million since June 2020 and $55.7 million in past two months, just 150 musicians and brands sold NFTs in the past year. The majority of musicians profiting from the market are already successful artists, such as Grimes, Steve Aoki and The Weeknd. 80.7 percent or $48.6 million of the reported total was earned by electronic artists.
Hu writes that buyers of NFT works tend to come from "niche, ultra-wealthy crypto communities... people who are already familiar with the technicalities of how crypto works, and who are sitting on enough crypto to be comfortable investing $600+ in buying a digital artwork." She also notes that "the most successful music NFT auctions to date have centered visuals, not audio, at their core" and that the specifics of copyright for labels and publishers remain undefined.
NFT artworks have also been criticised for their environmental impact. The Ethereum cryptocurrency's annual energy consumption currently ranks alongside countries like Singapore, Hong Kong, Portugal and Iraq.
Read the full report.