Currents: Alternative blockchains for music NFTs and the rise of niche music “metaverses”

This article is a web version of our biweekly, member-exclusive digest dedicated to our editorial and database updates. We break down and connect the dots among announcements of funding rounds, acquisitions, NFT drops, and other highlights in the music/tech ecosystem that we track as part of updating our suite of databases.

As of this week, we’re rebranding these editorial and database updates into a new vertical called Currents (thanks to our visual designer Ana Carolina for the fancy new banner). The rebrand is in line with the eponymous, read-only channel we launched in our private Discord server last month — in which our research team curates links to news announcements that shed light on the latest music/tech trends, often tying news to ongoing community discussions in the server. If you’re not already in our Discord server, please click here to authorize the Memberful Discord bot, which should give you access.

We’ve identified a few themes over the last two weeks in our research and additions to our Music/Audio Tech Investment Dashboards and Music Web3 Dashboards worth a connective look, including:

Web3 to live connections

As large-scale events return en masse, investments and activations that connect web3 to live music and other in-person events also climb.

• Coachella launched its own dedicated NFT marketplace as part of its two-weekend festival, which wraps up today. Coachella has been the most monetarily successful example of a festival connecting their live experience with Web3. Its Infinity Keys collection, which offered lifetime passes to the auction winners, brought in around $1.4M alone. In collaboration with music collective 88Rising, the festival has offered a range of perks, including early access to merch drops, upcoming NFT collections, and photos redeemable as physical prints.
• Warner Music Group has partnered with POAP Inc. to create “shared memories” around events. POAPs (Proof of Attendance Protocols) are NFTs commemorating an in-person event that attendees can store as collectibles. The partnership gives WMG and its roster of artists the ability to create attendance-related NFTs — deepening its investment in Web3 in the last year, following other recent Web3-related partnerships including those with Splinterlands, OneOf, Blockparty, Wave, and Genies.
• Elsewhere: Swiss electronic music festival Caprices hosted an NFT Summit earlier this month as part of its 2022 edition. NFT ticketing startup Afterparty also hosted its inaugural NFT-gated event in Las Vegas in March. And an NFT artist emerging from Bored Ape Yacht Club – Ape Rave Club – is due to “perform” at Belgian festival Tomorrowland this July.

Not every live event that has offered NFTs has been successful, though. For example, in our retrospective look at NFT sales in 2021, we found that Gov Ball’s NFT offerings failed to generate substantial revenue. Most of the tokens are still available for sale many months later.

We continue to track the convergence of Web3 and live events as more music festivals and tours integrate offerings throughout the summer. This festival season’s live events may demonstrate the utility that NFTs can offer fans beyond the digital collectibles historically associated with the technology, by offering gated access, exclusive merchandise, and other community- and experience-driven perks.

Alternative blockchains for music NFTs

Since NFTs entered household-name status in early 2021, there has been skepticism toward NFTs revolving around the negative environmental impacts of blockchain mining and consensus methodology. In fact, according to our research, adverse environmental factors rank among the top concerns around Web3 and NFTs for both fans and music-industry professionals.

So, it’s not surprising that we are seeing trending usage of blockchains aside from Ethereum in recent music NFT drops and new platform offerings — namely, blockchains that use the less energy-intensive proof-of-stake rather than proof-of-work consensus mechanism for verifying transactions:

• Snoop Dogg’s most recent generative NFT drop, Baked Nation, is one of the only celebrity-driven drops we’ve tracked that has been released on Cardano.
• Hoskinsea launched last month as the largest NFT marketplace on the Cardano blockchain, after a private token sale of its $HSK.
• FanDuel’s co-founders launched a new NFT platform, Vault, on the Solana blockchain.

Since November 2021, we have tracked more than 35 music/Web3 startups in our database, and at least half of them are on a blockchain other than Ethereum (e.g., OneOf is on Tezos, Solo is on Polygon, Zaiko on Binance, and EQ Exchange is on Celo). This distribution is significant considering that, according to our music NFT sales database, 90% of music NFT sales in 2021 happened on the Ethereum blockchain.

Celebrity endorsements may help alternative blockchains to Ethereum 1.0 gain more hype and development activity. Whether pivoting to more eco-friendly blockchains will lead to a shift toward positive sentiment from the anti-blockchain crowd is difficult to project; still, the effort to assuage them is apparent.

More niche music “metaverses”

As we prepare to kick off our Season 2 collaborative research project covering music and the metaverse, we have noticed an influx of artists and music brands launching their own niche –verses in recent months.

Because building a custom metaverse from scratch can be prohibitively expensive and time-intensive, artists are turning to third-party platforms like The Sandbox, Decentraland, and The Microverse to create their own branded virtual spaces. Joining the metaverses we’ve covered by artists Steve Aoki (“A0K1VERSE”), Dolly Parton (Dollyverse), and Megan Thee Stallion (Hottieverse) are:

• Metal band Slipknot have launched their own “metaverse,” deemed the Knotverse, inside blockchain-based customisable gaming world The Sandbox. Fans can collect merch and, of course, masks, plus attend virtual concerts in Sandbox. Fans will also have access to in-person events and new music.
• San Francisco-based record label Dirtybird launched its own “metaverse nightclub” called Birdhain (based on Berlin’s iconic club Berghain) in its virtual world Birdyverse, accessed through their FlightClub NFT collection. Hopeful Birdhain entrants need to own one of 9090 NFTs minted by the label last year, which raised over $2.2M. Birdyverse is hosted on NFT community platform The Microverse.
• Coachella partnered with vodka brand Absolut to create Absolut.land, a Coachella-themed “metaverse” inside Decentraland, where participants collect wearables and collectibles for their avatars and search for discounts and other prizes.

This trend hints at a future of multiple, brand-specific virtual worlds existing in parallel, and highlights the ways that traditional Web2 businesses and brands are increasingly moving their traditional and experiential marketing campaigns into metaverse offerings — and how Web3 financial models seem inseparable from these offerings, at least for now.

Other music-tech news to note:

• Context, an app where you can follow activity for specific wallet addresses, completed a $19.5M funding round. In a landscape as noisy as Web3, curation and context (as the namesake app suggests) are likely going to be the next major drivers of value in the landscape as a whole; we’re already seeing this with music NFTs specifically, with Nina launching Hubs and Catalog hiring a new Head of Music Discovery.
• French streaming platform Deezer is going public via a merger with Special Purpose Acquisition Company (SPAC) I2PO. The IPO values the Spotify competitor at $1.1B. Deezer first attempted an IPO in 2015 before opting for a Series E funding round instead. This move makes Deezer the last of the major streaming platforms to go public or be bought by a publicly-traded company, following Square’s purchase of Tidal last year.