Music NFT sales in 2021: What we learned

Editor’s note: This is a collaborative research project that over 20 contributors in the Water & Music community undertook throughout the month of April 2022. You can view a full list of contributors and roles at the bottom of this article. You can also read this article in abridged slide deck form by clicking here.

If you think we’re missing 2021 sales from a specific music NFT platform, protocol, or artist that would significantly alter the output of our research (e.g. total sales numbers or distribution charts), please let us know by filling out this form. Under “Database for Consideration,” please select “Music/Web3 Dashboard,” which is where we track music NFT sales. Under “Additional context,” please reference this report and any specific charts or findings that you think should be modified. The more on-chain evidence you can provide, the better.


Over the last month, several contributors in the Water & Music community collaborated to analyze music NFT market dynamics, based on data from our members-only music NFT database. This report is the result — an in-depth analysis of 2021 music NFT sales by artist genre, platform/protocol, and label affiliation, covering over $86M worth of revenue, as well as a qualitative discussion of popular and emerging forms of utility that have emerged around the format in the last year.

Although our database is not exhaustive, we believe it is the most comprehensive view of music NFT activity that exists in the world today. We employed a managed process to crowdsource long-tail information on the 2021 music NFT market from our community, including backfilling previously missing sales data, auditing drops that had more extended sales timelines, and incorporating data from newer NFT platforms that launched later in 2021. Ultimately, this highly collaborative approach helped increase the number of drops represented in our database by over 30%.

We hope the information we have gathered offers an opportunity for our readers not only to gain new understanding of the market by putting their Web3 positioning in context, but also to take action by devising new strategies for Web3 projects.

Our main takeaways

Introduction + background

2021 was a banner year for experimentation in music and Web3. At Water & Music, we dedicated our last two collaborative research reports to highlighting how this experimentation in its various forms – including NFTs, social tokens, and DAOs — has encouraged the music industry to rethink traditional approaches to creativity, monetization, and fan engagement.

From a research perspective, this isn’t our first rodeo. We’ve been tracking music NFT drops and marketplace launches since the summer of 2020, in a members-only database that is updated every week. Our database has been cited in Bloomberg, Fortune, CNBC, Forbes, Billboard, Rolling Stone, Messari, and NFT Now, and is the go-to resource for some of the world’s top venture capital firms, record labels, and artist-management companies to gain crucial context on the music NFT market in an otherwise noisy information landscape.

We published our last music NFT market analysis eight months ago, in August 2021. Needless to say, the market — as well as W&M ourselves — has changed significantly in the time since. For instance, we tracked at least 20 new music NFT platforms that launched in the second half of 2021, including Sound, Catalog, Royal, Nina, Decent, and Arpeggi. At the same time, we ourselves became a DAO for collaborative research, going through the Seed Club accelerator and launching our $STREAM token in January 2022. This transition has provided an influx of knowledgeable Web3-native artists and operators into our membership, infusing even more interest and energy into keeping our NFT database current and providing important strategic context on the market to our community.

As NFTs continue to pervade the mainstream discourse, we thought now would be a good time to examine what we learned from music NFT sales in 2021, using our new collaborative capabilities as a DAO to paint a more nuanced picture of the market and do the long tail proper justice.

To reiterate, our database is not a 100% definitive list of all music NFT sales that have occured, but we believe it is the most comprehensive such resource that exists today. The database represents the knowledge gleaned by W&M community members who follow certain music-industry trends, artists, genres, and subcultures, and tends to center around North America, Australia, and Europe. There are limited data points for other world regions including Asia, Latin America, The Middle East, and Africa. The goal of the database has been to uncover and analyze overarching trends in sales, to note what is driving those trends, and to connect new dots for interested readers.

Scope + methodology

We take perhaps a more liberal interpretation of “music NFT” than other analysts or research organizations. We define a “music NFT” as an NFT that satisfies any of the following criteria:

Our approach to tracking music NFTs

To compile our music NFT sales data, our core research team manually tracks and logs activity on a weekly basis from various sources, including:

Given that most transactions used cryptocurrencies, we use a historical ETH-USD exchange rate chart to account for volatility, and calculate the USD equivalents as close to the mint or sale date as possible. We track artist and music data such as genre and label status using a variety of industry resources including but not limited to artist websites, Spotify, Chartmetric, MusicBrainz, Gracenote, and Rostr.

Backfilling missing + incomplete 2021 data

A significant portion of this retrospective analysis project involved backfilling our database with new information on missing drops, as well as updated information on the collections that were still for sale at the time of first recording.

Our team includes over a dozen community members who updated sales information across hundreds of NFT collections. Over three weeks, more than 300 records from 2021 were updated or added to the database, increasing the total number of drops represented by over 30% and adding about half a million dollars in USD equivalent sales to our tracked total. Collaborators revisited NFT sales marked as incomplete (indicated with an asterisk) in our database to observe and update what changed in the time since the original date of record.

Exploratory analysis

Once we had the database updated, we discussed what would be most meaningful to our readers and decided to take a quantitative AND qualitative look at the data from 2021.

A high-level summary of a few quantitative aspects of the database was appropriate because of the clear story arc seen in the numbers. For the music NFT sales we tracked in 2021, we looked at the following metrics:

(Editor’s note: Throughout this piece, we refer to the first half of the year as “H1” and the second half of the year as “H2,” in line with wider financial reporting standards.)

In addition, digging into the qualitative side was crucial for humanizing how music NFTs were being used in practice, from the perspective of both artists/creators and buyers/consumers. Because we do not have a perfectly comprehensive dataset, we could not comfortably analyze correlations between different kinds of utility and the ultimate success of a drop — e.g. if one musical artist generated more NFT sales because they partnered more with visual artists than their peers. But we could, we decided, look at the differences and evolution of the utility and benefits that were offered alongside the core NFTs, and ask why those offerings may or may not have added value or shifted in value over time.

To approach a summary of trends in utility offerings, we ran initial searches through our database to identify projects with access to in-person experiences or physical goods included in the NFT purchase (e.g., festivals, merch), as well as projects that denoted charitable or philanthropic components. Finally, we cross-checked our database notes against press releases and statements which helped identify additional off-chain utility offerings, such as token-gated community access.

Sales summary

Primary sales revenue throughout 2021

We tracked about 1,500 NFT drops in 2021, representing more than $86M in USD equivalent sales. Monthly sales averages dropped by over 90% in May from a peak early in the year, but have slowly risen since:

Number of drops throughout 2021

Similar to revenue numbers, the total number of drops we tracked peaked in the spring, fell, and has been on the rise again since autumn:

The kinds of drops included in this analysis include single-copy and multiple editions sold as auctions, fixed-price sales, and free giveaways. In our database as a whole, we prioritize drops that have generated a sale, for the sake of efficiency.

As we have covered in the past, the dramatic drop in music NFT activity from the peak in the spring reflected the NFT market at large. However, we did notice a significant rise in activity toward the end of the year, due to a number of new platforms focused on music-related NFTs that launched in late 2021. Platforms such as Sound, Pianity, and Nina began releasing drops from independent artists in November and December, solidifying a significant shift from big-event, celebrity-driven drops earlier in the year and resulting in relatively more accessible and lower price-per-unit sales events.

Leading artists

When looking at the year as a whole, a few artists dominated the market, particularly within the sales spike we saw in early 2021. A cluster analysis conducted by one of our collaborative researchers showed that five artists stood out as leaders representing activity we saw in the year: 3LAU, Deadmau5, Tory Lanez, Grimes, and Steve Aoki.

With nearly $18M in 2021 NFT sales, 3LAU emerged as a leader in music NFTs in 2021 for several reasons. Of the top-selling artists we tracked in 2021, 3LAU did not sell the most units, but had the highest average sale per unit. His royalty-focused music NFT marketplace Royal, which we have discussed in past research and again below, obtained $71M in Seed and Series A funding rounds last year.

We tracked $2.7M in NFT sales in 2021 for deadmau5 — who, notably, sold 500,000 more units than 3LAU. Beyond NFTs, deadmau5 has greater Web3 ambitions: He is a co-founder ofPixelynx, a Web3-native music metaverse platform that raised a $4.5M seed round in December, as well as an investor in MODA DAO, which is dedicated to building new Web3 licensing and DeFi standards for music.

Tory Lanez sold the most units of the releases we tracked, with over one million editions of his NFT album When It’s Dark selling for $1 each. But as we covered in October, there was significant skepticism around the drop’s success. Broad speculation appeared to drive the sale, with the artist claiming there was a valuable secondary sales market. However, some purchasers allegedly felt “duped” when those secondary sales did not pan out for them.

Grimes and Steve Aoki both drove a lot of attention to NFTs in early 2021 thanks to their celebrity status and the high bids they garnered for their sales: Grimes earned over $6M last February across ten drops, and Steve Aoki raised nearly $5M on 13 drops (all on Nifty Gateway). Steve Aoki in particular has continued to be active and outspoken about the benefits of Web3 and NFTs for artists, and has also expanded his Web3 footprint with his Aok1verse project, launched in 2022.

Percentage + distribution of sales by platform

When analyzing sales numbers by platform, we can see that early high-priced “event-style” drops on Nifty Gateway outweighed the first half of the year, with the platform representing over half of the primary sales we tracked — but then quickly lost dominance in H2, particularly as new platforms like Sound and Nina that were geared explicitly towards music rose in prominence:

Sales by artist genre

The broadly defined Electronic genre dominated music NFT sales in 2021, with Hip-Hop taking a distant second:

This trend stayed true throughout the year, but we also saw new platforms launching geared toward new audiences that may change that distribution in the future: for example the marketplace Solo which has a country focus.

Sales by artist’s label affiliation

While there isn’t a definitive database of artists’ label status at any given time, we attempted to keep track of this information, and found that independent or unsigned artists dominated NFT sales in 2021:

While major-label artists certainly drove a lot of attention to the market, the appeal of the absence of middlemen, along with the direct control of rights and access to artists’ communities, drove a lot of activity to NFTs for independent musicians.

Sales by blockchain network

Ethereum was the preferred blockchain for NFT sales in 2021, accounting for 79% of drops and 90% of primary sales we tracked in 2021:

As we covered in our Season 1 report on music/Web3 tools, Ethereum is one of the most truly decentralized blockchains in terms of both the network itself and users’ access to the network — which has led to one of the most flourishing developer communities in Web3, and especially in music. In fact, the fundamental concept of NFTs comes from developments first put forth by people building on Ethereum.

However, we observed a significant shift between the first and second half of the year: Ethereum’s share of the drops we tracked decreased from 92% in H1 to 53% in H2. Perhaps due to perceptions around environmental concerns regarding Ethereum’s energy usage, there was a push towards alternative blockchains — including Layer 2 solutions like Polygon that have lower gas fees, as well as chains like Tezos and Solana that use more energy-saving proof-of-stake (PoS) consensus mechanisms rather than the proof-of-work mechanisms that Ethereum and Bitcoin currently do. (Ethereum does plan to move to PoS later this year, so this trend may reverse.)

As noted previously, the early days of 2021 included many event-style drops on Nifty Gateway that drove significant revenue numbers. Of the 163 drops that we tracked throughout 2021 that yielded more than six figures, 80% of them occurred in H1. Additionally, it was not uncommon to see individual NFTs sell for more than $100K each, particularly in the early days: We tracked 33 single-copy auctions that garnered at least $100K, all the way up to $1.33M for 3LAU’s Gunky’s Uprising NFT. Of those largely celebrity-driven mega sales, just five occurred in H2.

That said, between February and December 2021, the average price per music NFT fell by 46%, from $18.8K to $10.2K per unit; the median fell by 27% over the same time frame, from $1,000 to $825 per unit. This may be in part due to the increasing number of collections we saw dropping thousands of editions at a time in H2. In August, Tory Lanez, as we mentioned, dropped one million copies of his “When It’s Dark” NFT for $1 each; the following month, Doja Cat sold 7,000 editions of her “Nemesia” NFT for $5 each on Oneof. We saw more experimentation with so-called “10K drops” by the end of the year, such as the (Ghost of) Frank Dukes in late December, mimicking the drop structure of popular PFP projects like Bored Ape Yacht Club and CryptoPunks.

Our previous studies on fan sentiment and industry concerns about Web3 pointed to financial accessibility and inclusion as the top areas of improvement needed in the ecosystem. Interestingly, it seems that celebrities with larger fan bases began addressing this with larger-scale drops at relatively lower price points, aiming for scale with more units offered per sale event. But the average price per unit was still extremely high at the end of the year and even the median price was over $800, which is financially inaccessible to the vast majority of music fans and shows that there is a long way to go.

wen utility? The top music NFT use cases

Given all that we have observed about the quantitative trends from 2021, we now shift our focus to address some of the qualitative aspects we uncovered when analyzing the music NFT activity in 2021. A look at the different types of NFTs and the evolution of the benefits offered alongside them allows us to explore as best we can 1) which aspects added value, and 2) what musicians, artist teams, consumers, and platforms can learn to better understand where customer demand may be headed.

Defining “utility”

For the purpose of this report, we define utility as any measure of value that collectors derive from owning an NFT. That value can correspond to different types of benefits:

Those benefits can also be realized:

As the NFT category progressed through 2021, we saw increased diversification in NFT utility, involving creative bundles of all kinds of benefits as unique value propositions for fans. Broadly, we found a trend in bottom-up adoption — wherein individual, largely independent artists led experimentation with innovative forms of utility, with NFT platforms often later incorporating those offerings into their products at scale.

To an extent, the utility artists can offer with their NFTs is limited to the underlying technology’s powers, or lack thereof. It’s not uncommon to hear enthusiasts posit that the best forms of NFT utility either “haven’t arrived” or are “yet to be imagined” as artists and platforms race to get ahead of the curve. Catalog, one of the earliest music-specific NFT platforms, describes this nearly limitless composability of music NFTs in an early slide deck, explaining: “this new [NFT] format is programmable, and its function is in your control–what’s possible will evolve as the technology matures.”

Looking back at the utility of music NFTs we saw in 2021, we highlight this process of evolution as artists and developers continue to dream up new possibilities and potential for the growth of music NFTs into the future.

The basics: Media NFTs

One of the most basic forms of utility for music NFTs is simply … the music itself. In this case, the utility is provable ownership of the music NFT on a given blockchain, attracting collectors by providing the status associated with owning the collectible — similar to the benefits of owning a physical limited-edition vinyl record.

It’s important to note that the audio (and accompanying visual) portions of music NFTs are often not stored directly on-chain, but instead are linked from the metadata of an NFT’s smart contract and live on third-party sites such as IPFS or Arweave. However, the smart contracts used to build NFTs do allow creators the ability to offer various other forms of utility over time. Artists often start from this basic audiovisual format and add features modularly after the sale.

2020 saw initial experiments tying original music to NFTs, with projects from artists like RAC and 3LAU using this basic format to experiment with digital music drops. Many of these drops resulted in multi-thousand dollar sales prices for each individual work.

Despite an overall diversification of utility for music NFTs in 2021, we found that simple music NFTs, whether sold as 1/1s or multiple editions, persisted and were common throughout the year. For example, electronic group Disclosure — newly independent as of last spring — released their first music NFT on Zora in March 2021, featuring the track N . F . T – N . R . G, as a single edition. The NFT, which offered no utility beyond the embedded music itself, garnered a sale price of $116.6K. Other platforms like Catalog and Async launched throughout 2021 with the explicit goal of focusing on the music itself as the primary form of utility for their respective NFT offerings.

Independent hip-hop artist Latashá, who also serves as the Head of Community Programming at Zora, is one of the most prominent examples of an artist who has stuck mainly to highlighting the value of her music itself in her NFT drops. She has consistently released new music NFTs as 1/1 editions via Catalog since March of 2021, all of which focus only on the music as the primary form of associated utility. Her success on Catalog, with sales netting returns as high as 7.1 ETH each, demonstrates that music itself can provide strong value for collectors, despite the flashiness and excitement around other, more advanced forms of utility, as we will explore below.

Royalty-bearing NFTs

Another widely discussed and implemented form of music NFT utility is the packaging and inclusion of artists’ music royalties as an added benefit to the purchase of a music NFT.  Royalty-bearing NFTs provide a way for artists to directly cut their fans and collectors in on the revenue from the monetization of the songs attached to their NFT offerings, from streaming revenues, to rights to the sound recordings, and more.

On a technical level, whether this royalty-bearing functionality is captured and executed fully on-chain depends on the NFT in question. Ironically, the royalties and licensing terms that govern a given NFT are generally established through an off-chain legal contract that exists separately from the NFT smart contract. As we explore in our Season 1.5 report on legal contracts for music NFTs, it is possible to attach off-chain contracts to an NFT either directly as metadata in the corresponding smart contract, or through linking from the smart contract metadata to a legal contract stored on a decentralized network like IPFS or Arweave.

Royalty-bearing music NFTs have been relatively slow to enter the market — owing largely to outstanding legal and regulatory questions around whether or not this class of NFT qualifies as a security and should be subject to additional regulation. Analysts have also pointed to the potentially long timelines before buyers of royalty-bearing NFTs recoup their initial NFT purchase investment, especially given the minuscule payment rates artists currently receive for streams via DSPs.

Perhaps due to more direct control over – and flexible approaches to – their IP, independent artists have led the charge in carrying out early experiments with royalty-based utility. For instance, electronic musician Jacques Greene auctioned an NFT for his song Promise via the NFT platform Foundation in February 2021. The NFT, which sold for $35.6K, provided the purchaser with the publishing rights to the song, in perpetuity, meaning that they can now generate revenue from the song through publishing avenues including movie or TV sync licenses. Similarly, the artist Vérité’s release of her song by now on Zora in April 2021 generated $29.9K for the artist, while allowing the purchaser to redeem a 2.3% share in revenues associated with the song’s master recording. In September 2021, electronic artist Daniel Allan’s Overstimulated crowdfund on Mirror raised $135K across six different tiers of NFTs, to help fund his Overstimulated EP. The perks for the tiers were cumulative, such that higher-priced tiers received the perks included for all less expensive tiers as well; all tiers also directly corresponded to a share of master royalties generated by the EP, which token holders could claim in the form of USDC.

Multiple platforms have since attempted to provide the same utility at scale throughout 2021 and well into 2022. Royal attracted significant media attention for its high-profile royalty NFT releases from a diversity of artists, including Nas and cofounder 3LAU himself. Depending on the drop, owning a Royal NFT grants each collector around a 0.5% to 2% share in future streaming royalties of the corresponding song, depending on the tier of NFT they purchased.

Opulous has tried to avoid potential securities risks by working with the SEC to develop Security Non-Fungible Tokens (S-NFTs), which they tout as meeting federal regulatory requirements. The company registered major early sales of S-NFTs in partnership with the investing startup Republic, including a drop for Mona Lisa (ft. Soulja Boy) by Kanye-collaborator and well-known hip hop artist Lil Pump. The drop generated $500K in primary sales, and offered purchasers song royalties “accumulated through streaming, licensing, ads, and more.” (It’s worth noting that Republic is currently being sued by Republic Records, a sub-label of Universal Music Group that boasts Taylor Swift and Drake among its roster, for trademark infringement owing to their very similar names.)

A more recent entrant to the royalty-bearing music NFT scene is Decent (launched March 2022) — which offers NFT collectors access to artist royalties via a staking program, in which buyers lock up their NFTs for periods of time in exchange for receiving artist tokens that ultimately provide buyers with a portion of artist royalties related to the minted song. This staking method is meant to deepen the connection between artists and collectors by requiring collectors to invest in artists for the medium or long term. While we did not include this platform in our 2021 analysis, it’s worth following their evolution this year; in April 2022, producer Harrison First’s royalty-bearing NFT release of the song “The Garden Against the World” sold out its 40 NFT editions on Decent, generating 4 ETH (about $11K) for the artist in the process.

We will continue to watch the royalty-bearing music NFT ecosystem as regulatory issues are clarified and artists and platforms continue to innovate the ways they might provide NFT purchasers with royalties — whether directly as part of the NFT purchase itself, or as in the case of Decent through additional staking methods meant to align artists with collectors.

Rights to use the music

Closely related to royalty-bearing music NFTs are those projects which provide NFT purchasers with specific ownership rights to use the music, or access to tracks attached to music NFTs to produce remixes or other derivative works from them.

The intended impact of these projects revolves around network effects. Collectors who purchase these NFTs are able to benefit financially not only from potential resale value of the NFT they purchase, but also from the sale or licensing of the audio contained with their NFT and any derivative music based on the audio that they produce and release. Like royalty-bearing NFTs, tokens that invoke ownership rights encourage more active involvement from collectors in generating interest around a project;unlike royalty-bearing NFTs, ones that explicitly assign rights ownership also encourage derivative music creation itself as a form of promotion.

The concept of tokenized licensing models has been gaining momentum in the visual NFT world for some time. Projects such as Nouns enable CC0 licensing — which makes the intellectual property around the project fully open for the creation of derivatives, not only by NFT purchasers, but by anyone who feels the urge to produce a derivative work. Larger PFP projects like Bored Ape also give full commercial rights to any holders of their NFTs. In contrast, within the music NFT ecosystem, we did not detect any CC0-licensed projects for our 2021 sales analysis.

That said, 2022 may be a banner year for the CC0 concept in music and Web3. Some artists such as Oshi have indicated that they intend for all of their work to carry CC0 licensing in the future. STEMS DAO, which launched in January 2022, partners with artists to release the stem-layers that make up individual songs (e.g. vocal layers, guitar layers, hi-hat layers) as their own unique NFTs. Purchasers of these NFTs are provided with ownership rights to the fully mixed song, including future streaming royalty potential, as well as the “full rights for composability into remixes and other art,” providing multiple routes for collectors to innovate and produce new art and value from the music associated with the original NFT.

omgkirby is another DAO experimenting in this realm. They released a genesis collection of 3,000 lo-fi generative music NFTs in January 2022, which provide buyers with complete song ownership, including both rights to the sound recording and publishing for the song. This collection is already producing interesting results, as one of the initial NFT purchasers, wallyPDF, has chosen to release two of the tracks included in their omgkirby genesis NFTs on traditional DSPs. These tracks have now been included in the lofi beats curated playlist on on Spotify, and are generating streaming royalties for wallyPDF, while also serving as an advertisement for the omgkirby project and a test balloon for this model of music NFT distribution and licensing.

It is too early to provide a strong evaluation of the longer term benefits of open licensing for music NFT projects, as network effects generally take time to accumulate and produce new value. Moreover, how exactly these rights are enforced is still an open question. Similar to royalty-bearing NFTs, the added utility of rights ownership can be represented on-chain via the attachment of an off-chain legal contract to the NFT smart contract metadata, but not all projects adopt this model. We will pay close attention to this area of utility over the coming months, to better understand the outcomes and efficacy of open licensing approaches to music NFTs over time.

Splits protocols

Splits protocols allow artists to cut their collaborators in on NFT revenues, by sending the proceeds from NFT sales directly to multiple wallets. In practice, this means artists releasing music NFTs can now share their revenues in a fully automated way with their entire range of creative and commercial collaborators, including co-writers, session musicians, artwork creators, mix engineers, marketers, and more.

Music has been an inherently “multiplayer” endeavor throughout history — from the collaborative nature of the creative process, to the networked nature in which it is marketed, shared, monetized, and experienced. And yet, with all their hype, the concept of NFT platforms enabling this fundamental ingredient of splits among multiple stakeholders remains relatively new and hard to come by.

There are some early signs of this gap closing in 2022, with caveats. Nina, a music NFT protocol and marketplace that launched on Solana in November 2021, allows musicians who release on the platform to add splits to their revenues after publishing their release, using a splits function they built in-house. Even so, there isn’t currently a way to display the splits assigned to individual releases on the front-facing site. Splits-enabling protocols have only recently made their way to music NFTs on Ethereum, with the launch in 2022 of 0XSplitsand Slice, both open protocols for splitting on-chain revenues, as well as the launch of an in-house splits protocol on the NFT platform Foundation (though splits on Foundation are capped at three collaborators per collection).

Music NFT platforms like are also now in the process of incorporating these open splits protocols into their offerings. Below is a striking example of a split among many collaborators — including performers, producers, and curators — on Soulection’s UNTITLED 001:

Arguably, the ability to split revenues is more relevant to the supply side of NFTs (i.e. artists) than to the demand side (i.e. collectors). However, a complementary hypothesis is that publicly declaring NFT splits on-chain might potentially drive additional demand, by pulling in the fan bases of the entire range of collaborators on a music NFT as potential buyers. Likewise, enabling splits with a wide range of collaborators signals the underlying values around compensation that an artist holds (e.g., building a more equitable community of creators around a given work), and those values might drive additional demand when they align with the values of potential collectors.

Some artists are even using splits to test out new models for paying artists whose work is featured across DJ mixes, an area where lack of royalty payments for song creators has been a longstanding gripe of many musicians. For example, artist and DJ Maelstrom released a 1-hour DJ mix on Soundin late March 2022 featuring tracks from other artists, and used the platform’s splits feature to ensure that all of the artists featured on the mix received a percentage of the sales revenue for the NFT. The drop ultimately sold out and raised about $41K in total, split among 14 artists. (This drop is not included in our 2021 aggregate sales analysis, but we believe is a strong indicator of the kinds of collaborations and business models to expect around splits in the near future.)

Given the open and free nature of the splits protocols that have been released to date, there is significant potential upside and little downside for platforms integrating this functionality and providing artists releasing NFTs, with easy options for collaboration and automation of back-end payments. We anticipate that the utility to add splits to music NFT releases will continue to become more common into the future, driving more collaboration and experimentation among artists.

Pt. 2: Off-chain utility

We next take a look at trends in off-chain utility, which refers to benefits that are delivered and experienced outside of blockchain-specific environments. We identified these trends as part of bundled offerings along with the NFT sales; they tend to be labor-intensive, as artists or their teams need to coordinate with the NFT owner post-sale, and at times are vague and less defined.


One of the first off-chain utilities we observed involved using NFTs to cultivate long-term communities by continuing to add value to token-holders post-drop.

The recurring offerings usually take the form of access to private Discord servers, or to bonus channel access within open servers — often with the promise of direct interactions with artists over time, beyond what is expected in a standard meet-and-greet setting. For instance, Doja Cat’s entrance into NFTs included 26,000 tokens dropped on OneOf, where owners were “recognized as founding Kittizens of Planet Doja” and given access to a members-only Planet Doja Discord server community “where they can interact daily for a chance to win luxurious rewards, airdrops, and merchandise.” Avenged Sevenfold’s “Deathbats Club” (pictured above includes “metaverse access, Web3 sneak peeks, first dibs on concert tickets, giveaways, airdrops in-person and virtually, no lines into Avenged Sevenfold concerts (when applicable), Discord authentication and much more.”

A new crop of startups like Unlock, Temple, Highlight, and Medallion have recently emerged with the explicit focus on helping artists launch NFT-gated online communities, across multiple platforms including Discord, WordPress and Discourse, in addition to whitelabeled sites. Here again we see the trend of individual artists spearheading experiments, followed by dedicated companies emerging to scale those experiments into long-term software services.

Importantly, sustaining communities online takes significant time and labor contributions, as well as intentional curation and evolving purpose of the community. Yet we saw several NFT sales in 2021 offer gated fan communities as a carrot, but with vague (or even nonexistent) descriptions of the community’s overarching purpose or what fans would receive once they joined, beyond “future access” to artists and experiences. This was especially the case with off-chain offerings, such as guestlist access to concerts or signed vinyl records, which are already coordination-intensive to execute for fans even before introducing Web3. In bundle descriptions for NFT drops at point-of-sale and in subsequent media coverage, we repeatedly saw open-ended terms like “access to future perks or events,” “chances to win future prizes and merchandise,” “tokens with abilities that have not yet been revealed,” and “early access to special fan perks, tickets, experiences, and more.”

We’re left to wonder what personnel resources and accountability mechanisms are in place to ensure artists and their teams follow through with promised in-person benefits, especially when the terms of purchasing an NFT terms include a “chance to win.” We will continue to watch how these communities evolve and sustain over time, and what elements of purpose, connection, and utility will ultimately stick.

Live music + physical goods

Much of the music NFT hype revolves around the concept of digital scarcity around a format that otherwise is free and ubiquitous in the streaming economy. It’s no surprise, then, that a recurring theme in music NFT utility is exclusive access to IRL concert experiences — one of the last bastions of scarcity in the traditional music business.

“VIP,” “festival,” “tickets,” “show,” “meet & greet,” “guestlist,” and “backstage” were among the “live experience” terms found in NFT offerings across all genres. A handful of examples include:

We found a few festivals venturing into NFT offerings in 2021, perhaps enticed by the hype and potential new revenue stream amidst ongoing financial struggles around the pandemic. India’s Sunburn Festival saw some success with its offerings that included in-person perks like year-long access to events, VIP tickets, and meet-and-greets. Governors Ball was one of the few US festivals to stand up an NFT offering, via a partnership with Coinbase that included an NFT Gallery and a token-gated VIP lounge/viewing area. A pre-festival NFT drop for Gov Ball also included commemorative art, photography, and lineup poster art from previous years, leaning into the memorabilia- and nostalgia-driven ethos that has driven a lot of NFT activity from legacy brands. Another round of NFTs were released after the fact featuring highlights from the weekend, which were minted on the last day.

Physical and digital merchandise comprised another common off-chain utility bundle we observed. Standard signed prints, CDs, vinyl records, and props were included in several celebrity drops from the likes of Eminem (with Nifty Gateway), Katy Perry (with Theta), and Kings of Leon (with YellowHeart). Others paired digital merch with in-person offerings, like a custom Young & Sick digital portrait or avatar that came with their Save Our Stages release. Still other drops included access to never-before-seen live sets and archival footage, such as those from Don Diablo, Disco Biscuits, and the Dallas Symphony Orchestra.

It remains to be seen whether the unique nature of NFTs make them the best form of entry into these experiences compared to other, more Web2-facing approaches. NFTs as digital merchandise could be a potentially valuable verification layer on top of traditional merch, to the extent that the NFT is personalized to the fan and/or live experience and reflects a shared experience among fans. There is also an opportunity for NFTs to be integrated into hybrid livestreaming and events platforms to increase reach to at-home fans, and perhaps lend themselves to real-time live generative experiences mediated by tokens.


In our previous market analyses, we highlighted philanthropy as one of the top use cases for music NFTs, as artists sought to use the technology for good while addressing fan concerns about environmental and financial costs. Unsurprisingly, this angle has carried on throughout the rest of 2021 and well into 2022 as well.

Billboard partnered with its Change Maker award recipient Trae Tha Truth to launch the first ever award show NFTs, benefiting the rapper’s Angel by Nature non-profit; the drop has raised over $10,000. We also saw NFT projects support projects like Save our Stages, which raised money to support struggling venues during the pandemic, and iHeartRadio Festival’s partnership with OneOf on a series of NFT drops where 100% of proceeds benefited the Right Here, Right Now Global Climate Alliance. The artist estates that coordinated drops in 2021, like those of Amy Winehouse, Jerry Garcia, and Whitney Houston, all designated charities to receive all or a portion of proceeds from sales, including the artist’s namesake foundations. Diplo’s March 2021 drop on Nifty Gateway noted that “ALL PROCEEDS from this open edition will benefit three charities — P.S. Arts in Los Angeles, Arts for Learning in Miami and Free Arts NYC in New York City — with additional funding toward grants to offset onboarding and gas fees for emerging NFT creators globally.”

We are left to wonder if the inclusion of philanthropic giving as a form of utility in these NFT drops is seen primarily as a marketing tactic to justify fan buy-in to Web3 projects where they would otherwise be skeptical. (To be fair, philanthropic giving is already a well-used tactic for converting fans into buyers outside of the NFT ecosystem, with music-themed nonprofits like PLUS1.) We also see the potential for future, accountability-driven investigations on the execution of “off-chain” utility packages, where we follow the money from crypto wallet to dollar donation to the featured charity for a given drop, and see if projects in this category genuinely deliver on their promises.

Outstanding questions + directions for future research

The “meta” challenge of metadata

We believe that the highly manual nature of our methodology in tracking the music NFT market is a big part of the story about major challenges the market faces moving forward.

In an ideal world, we would have a 100% automated pipeline for ingesting data directly from both generalist and music-specific NFT platforms into our database, whether through API access or through regular tabular data feeds. Unfortunately, because there is a lack of standardized metadata across platforms for what counts as a “music NFT” — let alone what metadata is (or is not) stored in those NFTs, especially in terms of creative role, genre, and label affiliation — we still need to find, curate, verify, and interpret music NFT drops on a manual, case-by-case basis.

While Blockchain explorers like Etherscan and Polygonscan are full of valuable information, there is a dearth of educational resources online for how to parse and interpret transaction data across various blockchains. Hence, as technically “transparent” as they are, these explorers have presented a high learning curve for community contributors. Ironically, the free-for-all nature of decentralization has made its on-chain financial activity near unreadable and irreconcilable to laypeople across Web3 environments, both inside and outside of music.

This makes the process of populating a comprehensive database of curated sales that much more complex, especially if we want to educate new contributors in our community about how these blockchain explorers work. We will closely follow projects like musicOS that are working to create a necessary, consumer-facing context layer across music NFT platforms in a more accessible way, as well as DAOs like MODA that are working towards creating new licensing and monetization standards for music NFTs.

Expectations vs. reality for big brands

There were some aspects of 2021 music NFT sales that we do not expect will sustain. For example, at the beginning of 2021, we saw several mega-event-style NFT drops that drew six to seven figures each in primary sales. For instance, 3LAU, Steve Aoki, Grimes, Don Diablo, The Weeknd, and RAC all had 1/1 NFT auctions that brought in at least $300K each in the first half of the year. In hindsight, these drops largely reflected celebrity-driven status and early market hype.

As we revisited “incomplete drops” during the backfilling phase of the project, we found several drops that seemed to have had plenty of hype and audience potential at the time, but ultimately didn’t perform as we may have expected. One example was the Governor’s Ball x Coinbase partnership we mentioned above — which appears to have sold just a few dozen editions, with hundreds of editions still for sale. And (spoiler alert) there have been other brand-driven drops that we have since tracked in 2022 that also still have many open editions for sale relative to the number minted.

This discrepancy between expectations and reality in activity around certain drops — coupled with the fact that independent rather than major-label artists have driven the majority of NFT sales — suggests that prior brand recognition and reach alone is an insufficient indicator for a successful NFT drop. Rather, other factors such as the diversity and thoughtfulness of NFT utility, or the strength and frequency of preexisting interactions within a fan community, may be more relevant predictors of success.

Secondary sales

One of the on-chain features of music NFTs that has been touted as a key means of supporting the sustainability of artists’ careers is the ability to program smart contracts to provide original NFT creators with a percentage of the revenue for all subsequent secondary sales of the NFT. In practice, this means that artists are able to receive revenue continually over time as their NFTs are sold on from one owner to the next, potentially providing artists with a long-term source of passive income.

Most music NFT marketplaces support secondary-sales functionality, but there remain ongoing challenges around ensuring secondary sales splits are transferable when they occur on a different platform from where the NFT was originally minted. Without getting too technical, this challenge involves creating an updated NFT standard from the current ERC-721 standard, which would ensure functions such as secondary sales percentages are interoperable across platforms.

In its current state, our database does not address trends in secondary sales of music NFTs. However, an additional W&M analysis running parallel to this project is exploring secondary sales in more detail, with an initial article to be released in the coming days. It will highlight trading and collector activity around several high-profile music NFT drops. Long-term, we plan to flesh out the underlying metadata framework and tracking methodology in our music NFT database as a whole, such that we can account for aggregate secondary sales in future analyses of the market.

Customer growth + fan journeys

Community-building and fan onboarding are top-of-mind for artists and their teams when it comes to Web3’s biggest opportunities and challenges, including but not limited to NFT projects. Blockchain technology creates new capabilities for artists to cultivate truly direct-to-fan, fully independent, platform-agnostic businesses and communities, whose underlying monetization models and data infrastructures can last long after a given NFT drop first concludes.

Yet, there are few resources or frameworks out there for savvy artists to think strategically about their fan journeys in a Web3-native context. In future research at W&M, we will explore emerging CRM toolsets for music/Web3 experiences, and best practices to drive fan conversion across multiple segments:


All in all, 2021 marked the beginning of a seismic shift in the music industry toward the widespread use of blockchain technology to rethink traditional approaches to creation, marketing, distribution, and monetization. Looking back shows just how far we have come since we first began tracking the music NFT market.

The field continues to evolve at a rapid pace, and we believe 2022 will show how these early trends we’ve identified will ultimately play out — from keeping projects accountable for delivering on their promises to buyers, to seeing what kinds of pricing models and forms of utility ultimately stick with fan communities long-term. NFTs will continue to be part of a holistic career toolbox for musicians for the foreseeable future, and as the landscape and ecosystem continues to evolve, W&M will continue to follow along, spot trends, and connect the dots.