This is an adapted English version of our original Spanish-language report on music NFTs in Latin America, which was published on both W&M and FUTURX on December 21, 2022. It has been edited for clarity and readability, and is not a direct translation of the original version. The underlying data is accessible in our members-only music/Web3 dashboard.
During the last quarter of 2022, the FUTURX community and Water & Music set a goal: To collect and analyze data regarding all music NFTs in Latin America created before December 2022.
The result is this research report — which provides a first-of-its-kind snapshot into the distinct imprint of music NFTs in Latin America, outlining the ecosystem’s key region-specific characteristics and trends.
Examples of Web3’s emergence in the LatAm music economy are rapidly increasing — from Brazilian Hermeto Pascoal open-sourcing his collection of scores, to Maluma generating a visual universe, to Bizarrap to adapting his iconic objects in the form of digital collectibles, to Mexico’s Festival Ceremonia strengthening its community through NFTs. Further, a new ecosystem of artists (Xcelencia, Kasbeel, HeyBela, Paula Pazos, and Alex Paul, among many others) are developing digital business models to generate revenue and develop strategies without the pressures of existing Web2 platforms and industry systems.
There are numerous possibilities for music to find new formats and redefine the artist-audience relationship with blockchain technology. NFTs in particular can be a gateway to offering unique in-person experiences, granting future royalties of a song, and offering the ability to remix works, and music projects in Latin America are adapting to these possibilities in real time.
It’s unclear how music NFT strategies and models will consolidate in the future, given the vast and experimental approaches from early users. Still, this analysis aims to simplify core examples from Latin America and to trigger discussions on how we might adopt this technology to strengthen new musical ecosystems in the region. The intended audience of this report includes those who are working on and developing their own music/Web3 projects, as well as those who have not yet ventured into Web3 and are interested in a region-specific entry point to understanding the technology.
- TOTAL: Our dataset consists of 5,163 total music NFTs sold out of ~22,000 total music NFTs minted, comprising US$1.2M in total primary sales volume.
- MARKET CONCENTRATION: Just two artists (Maluma and Ozuna) account for 70% of total revenue in our dataset.
- INDUSTRY EXPERIENCE: 65% of the artists surveyed have more than five years of music-industry experience, and almost 35% have more than 20 years.
- MUSICAL GENRE: Electronic music accounts for 40% of our artist dataset.
- GENDER GAP: Only 23% of Web3 artists in our dataset are women, and only 2% are non-binary.
- UTILITY: 80% of music NFTs we’ve analyzed in Latin America are audiovisual projects, while 15% offer other utility to holders such as access to communities, merch, and royalties.
- PRICING: Of the NFTs in our dataset, 44.6% are single fixed-price (1:1). 30.5% are serial fixed-price, and 12.7% are auctions. Finally, 12.2% are airdrops.
- BLOCKCHAIN: The most used blockchain in our dataset is Ethereum (80%), followed by Tezos (13.4%), Polygon (6.5%), and Solana (2.6%).
Introduction + background
This report arises from the collaboration of two communities focusing on music and technology: Water & Music at the global level, and FUTURX at the Latin American level.
FUTURX was born in 2020 as a space for training and professionalizing musical ecosystems, and by 2022 had begun fostering a community and creating original knowledge and media on the music industry in a Latin American context.
That same year, Water & Music launched an extensive report on the state of music NFTs, and opened up a dialogue with FUTURX regarding ways to use research to help build regional music/Web3 ecosystems outside of the Anglo- and Euro-centric market majority.
This report represents a collaborative approach to filling in that gap for LatAm, with 30 individual collaborators from FUTURX and W&M helping throughout the data collection and analysis stages. Much of our data was provided by ecosystem agents themselves (i.e. artists and collectors), who met regularly in strategic planning and analysis meetings to make this report possible.
The result is not a definitive list of all the music NFTs produced in Latin America; however, it represents the first effort to collect and systematize data related to music NFTs in the region.
As with Water & Music’s previous Web3 research, we utilized a collaborative, decentralized approach to data collection — building off of W&M’s STREAM research framework and leveraging tools from both FUTURX and W&M’s communities to amplify outreach and enhance survey analysis.
First, we requested information through a form on our social media and newsletters. Then, we divided participants from FUTURX and Water & Music into groups to research different aspects of the regional music NFT market, including trends across marketplaces, artists, collections, and more. We also relied on direct data feeds from select music platforms as well as general desk research about the music NFT market at large.
For NFT pricing, we recorded the USD equivalent price of each NFT as close to the launch or primary sale date as possible. Given the significant fluctuation in crypto<>USD exchange rates, we used a historical exchange rate chart to calculate values.
In parallel to this process, we conducted nine interviews with key players in the ecosystem to contribute qualitative aspects to the report and validate the quantitative data generated. Quotes from our interviews are scattered throughout this report.
Finally, we hosted open working spaces in the FUTURX and Water & Music communities to discuss this report’s preliminary results and central themes.
How we define a “music NFT”
Throughout this report, as with previous Web3 research, we define a “music NFT” as an NFT (non-fungible token) that satisfies any of the following criteria:
- Sold directly by an artist or music brand (festival, label, production company, etc.)
- Containing musical pieces regardless of their duration or accompanying medium (e.g., Basseado, Xcelencia, Xedra, among many others)
- Linked to an artist or music brand in its perceived value (e.g., Ceremonios from the Ceremonia Festival, Cryptorastas)
- Revolves around music or musical culture as a central theme or value proposition for collectors (e.g., Hermeto Pascoal’s sheet music)
- Published on music-specific NFT platforms (e.g., Phonogram, Enigma, Sound.xyz, Catalog, Beatblox)
Relatedly, a music NFT does not necessarily have to contain audio to meet the requirement, so long as it is related to music. In this sense, NFTs tied to ticketing, sheet music, meet-and-greets, music royalties, and PFP projects (those that gather images to use as profiles) have also been considered for this research.
To fully appreciate this research requires an entry-level understanding of NFTs and the basic principles of the underlying blockchain technology. As a primer, we recommend this video made by the RIP Gang, an alternative urban music collective from Argentina, which articulates a few of the new possibilities of NFTs and the launch of the RIP Coin, their community access token.
Our dataset contains music NFTs from more than 15 Latin American countries. Argentina boasts the most significant proportion of artists in the data we collected, in no small part due to various macroeconomic factors driving the country’s population to adopt blockchain and crypto technologies more openly. Brazil, Mexico, and Colombia follow as the top represented countries in our data.
In Argentina, festivals such as Quilmes Rock, El Cosquin Rock, and the Soda Stereo Show have adopted NFTs to provide utility through services and merchandising. Web3-native artists like Paula Pazos, as well as artists like Tweety Gonzalez and Daniel Melero whose careers predate Web3, have experimented with various NFT formats, coupling storytelling with technology and innovation.
In Brazil, we identified many releases on the platform Phonogram.me. Hermeto Pascoal, a folk musician with more than twenty years of experience, provides a paradigmatic use case, disseminating original music and scores composed during the pandemic under creative commons.
In Mexico, we have obtained data from pioneer electronic musicians on Web3, ranging from artists like Zplit.eth, who has the oldest NFT in the database (dated August 28, 2019), to the more recent artist Alex Paul who has put forward a development strategy focused on NFTs. The Ceremonias Festival created the Ceremonios, a collection of NFTs with various utilities to strengthen the community around the festival, along with the Vive Latino Festival and Tecate.
In Colombia, we can cite Maluma again — who, with over ten years of experience, has linked urban music and reggaeton with a wide variety of business units around his project — or HeyBela and Kasbeel, two young artists who are building their musical project with a strong focus on NFTs and Web3.
Other emerging regions
Lastly, Uruguay, Cuba, and Puerto Rico have artists and projects developing using NFTs. Although these nations aren’t widely represented in our dataset, we’re noting these significant players creating in music/Web3:
- No Te Va Gustar, an Uruguayan artist whose career launched in traditional formats and who is now experimenting with Web3.
- Xcelencia, linking the traditional inroads with Web3 from Puerto Rico.
- Yaxx Castillo, who hails from Cuba and addresses issues the country has historically been facing around digital content consumption.
40% of the artists in our dataset make electronic music as their primary genre, followed by 20% for rock/alternative, 13% for urban, and 12% for pop.
This genre breakdown is consistent with some of our previous research; according to Water & Music’s 2021 report, 65% of music NFT sales that year had electronic music as the primary genre. Electronic artists tend to be more open to experimenting with new technologies and formats, and have benefited from a more open distribution culture that is friendlier to Web3’s ethos of decentralization.
In terms of the trajectory of musical projects, more than 65% of the surveyed artists have over five years of experience within the industry, and almost 35% have over 20 years. Projects with 1 to 3 years of experience represent 7%; this last range of artists includes many Web3-native projects.
Contrary to what one might think, we can therefore infer that most case studies in our dataset are not new projects, but instead previously developed and adapted from legacy formats and careers. This is an indicator that artists across career stages are betting on developing new business models around Web3 technology, exploring the possibility of generating strategies around storytelling, community, and experiential marketing through music NFTs.
Artist gender gap
Our research revealed that 63% of music NFT projects in Latin America so far have been launched by male-identifying artists, followed by women at 23% and mixed-gender groups at 12%, with non-binary artists accounting for just 2% of contributors.
This stark underrepresentation of women and non-binary artists matches other research on the gender gap in Web3 and the broader technology sector. And yet, on the surface, Web3’s open accessibility provides an opportunity to combat gender disparities. The lack of representation therefore raises some questions:
- How are Web3 community and conversation spaces structured, and how can we make them more inclusive and diverse?
- How can we involve more women and LGBTQI+ individuals?
- Are educational materials for releasing music NFT projects widely accessible?
Pricing, release, and utility trends
Overall sales volume and revenue
- Gross Revenue: US$1,159,086 from August 2019 to November 2022
- Number of NFTs Sold: 5,163
- Number of NFTs Created: 22,000+
Music NFT sales in Latin America have recently experienced significant growth, as evidenced by the gross revenue of $1,159,086 in our dataset. Artists released 92% of the projects in our dataset, while festivals accounted for the remaining 8%.
A financial comparison to traditional streaming economics can help us better understand the influence of the NFT format and its economic impact on independent artists. For instance, in Argentina and other parts of Latin America, approximately 10,000 streams on established platforms like Spotify can generate roughly $10. Our research has identified NFT projects with between $5,000 and $30,000 in primary sales each — the equivalent of 5 to 30 million streams, respectively.
Out of the approximately 22,000 NFTs minted in our dataset, around one in four sold. While the total NFTs sold to generate this revenue is significant for a new market segment, the total scale is relatively small compared to that of the traditional music industry.
Moreover, the market remains highly concentrated, with 70% of revenue generated from NFTs in Latin America originated from just two artists — namely Maluma (from Colombia, selling 747 NFTs for a total $378,232.51) and Ozuna (from Puerto Rico, selling 232 NFTs for a total of $456,428.85).
The remaining 30% comprises more than 140 other projects throughout the region, which demonstrate the potential for more diverse project development. Some standout examples include the following:
- Hermeto Pascoal (Brazil) has raised $6,784 through the sale of sheet music of his musical works, which allows the NFT holder the exclusive right to record performances of these songs, even for commercial purposes, at no additional cost — generating a unique possibility of experimentation with the composer’s music.
- HeyBela (Colombia) started her career three years ago, and has a community-building strategy primarily focused on NFTs. She has launched more than 65 NFTs (both 1:1s and editions) with an approximate value of $10,377.
- Babasonicos (Argentina), with more than twenty years of experience, has raised around $6,500 with NFTs of unreleased songs and Mixers (multitrack audio NFTs made by the marketplace Enigma).
We categorized each sale in our dataset into a distinct pricing category, such as a one-of-one (1:1) sale, auction, fixed-price series, or airdrop. The table below describes each sale type in detail:
Almost half (44.6%) of the released NFTs in our dataset are structured as unique (1:1) tokens with a fixed sale price, while 30.5% were serialized collections, representing many more editions of NFTs. 12.7% of the NFTs analyzed sold at auction, while 12.2% represent an airdrop approach.
At large, the way artists and labels are releasing music is changing in a Web3-native world. Instead of following the traditional logic of stereo recordings, some releases may have variations, such as shortened tracks, multitracks, or single versions of songs with many single copies. Some examples of this approach include the following:
- Crypto Música Records released 3,000 NFTs across both one-of-ones and editions.
- The Perris released 1,111 unique tracks, each with a randomized combination of stems.
- Basseado develops and releases many short works (30 seconds) as NFTs with an audiovisual complement.
Many artists also make different types of sales depending on the platform(s) they work with and the nature of the content they are releasing. As we have already mentioned, some marketplaces only work with one type of sale, such as Catalog (1:1), while others like Zora, Enigma, and Phonogram allow for more custom sale types and pricing models.
Ethereum is the leading blockchain for music NFT releases in Latin America, representing 80% of NFTs in our dataset. Tezos comes in second, with 13% of launches, followed by Polygon at 6% and Solana at 2.6%.
Ethereum’s prominence is primarily due to two factors. First, it’s the oldest blockchain on the list, where marketplaces such as OpenSea, Enigma, Phonogram, and Zora reside — and, consequently, where a large concentration of NFTs launch. That said, more recent networks like Tezos, Polygon, and Solana have seen significant expansion, particularly in the past year, thanks to the emergence of various platforms like Beatbox and SonGain, among others.
“While Ethereum is the main blockchain to launch NFTs and also has a certain symbolic value, other blockchains such as Tezos facilitate onboarding artists and collectors, since the NFTs and the gas fees are cheaper, they are more accessible and enable the possibility of launching an NFT with a lower investment.” – Basseado, Argentina
Our dataset contains more than 26 different music NFT marketplaces, as well as several custom artist-developed platforms designed to sell NFTs directly to consumers. OpenSea is the most widely used NFT platform, accounting for 41% of music NFT releases and 27% of featured artists in our dataset. Other globally-minded platforms like Sound, Catalog, and Objkt have been and continue to be highly relevant for the development of the regional music NFT scene.
Top marketplaces by number of music NFT editions sold
Top music NFT marketplaces by number of selling artists
Other LatAm-based NFT marketplaces focused on music include:
- Phonogram, a Brazilian platform containing NFTs and canonical collections from the nation. They’ve developed a token to aid onboarding and are working on expanding their regional reach.
- BeatBlox, a recently created Argentine/Uruguayan platform specializing in electronic music.
- Qurable, a Chile/Argentina platform whose major development is a collection by Daniel Melero that gained strength at the beginning of 2022 with the launch of the Web3 label Fluxia Art.
- sonGain, a platform that focuses on Central American artists and generates models similar to crowdfunding for projects.
“From Phonogram, we created our own token, which is stable with the Brazilian currency. The goal is to facilitate access to this technology and create our own wallet within the platform, where the user can use our coins within the platform.” Lucas Meyer, Brazil
The community value that a homegrown NFT marketplace can generate is significant for artists and creators, as it helps them connect with local audiences and build a fan base in their region. A region-specific marketplace becomes more responsive to local artists’ and creators’ needs and preferences, making it more attractive for them to use. In addition, a marketplace can offer artists and creators the ability to participate in events and activities organized by the platform, which would help to connect with other artists and creators and expand their network of industry contacts.
It’s also becoming increasingly common for artists to craft captivating narratives by releasing different NFTs across multiple platforms with different media hosting capabilities (e.g Kasbeel publishing her music and artwork across Glass, Catalog, and Zora). The possibility of finding the right marketplace for each instance of a project without the need to maintain exclusivity is an advantage of NFT marketplaces compared to traditional industry platforms. By diversifying platform presence, artists and creators can experiment to satisfy specific needs and goals.
Despite ultimately closing due to business challenges, Mint Songs’ open platform helped to raise visibility for Web3 artists in the region, and inspired artists like AlexPaul and Sagrado to create custom smart contracts for their music NFTs further down the line. While the custom smart contract strategy allows artists to have more control over how their songs are distributed and to set specific rules for the use of their music, it also requires significantly more technical knowledge than releasing via an established marketplace and may entail additional costs.
NFT utility trends
For this report, we revisited the definition of utility established by Water & Music in previous Web3 research. We define utility as any measure of value to the people who obtain an NFT. That value can correspond to different types of benefits:
- Functional: Provides the ability to do or enable something after being acquired, from access to a community, experience, or some physical good.
- Emotional: Creates a connection with that content or the artist or project that generates it.
- Financial: Represents NFTs as assets that may increase in value or generate revenue, for example, a percentage of royalties.
Utility can also be delivered to NFT holders in two ways (not mutually exclusive):
- On-chain: Integrated with the NFT smart contract. Examples include NFT revenue splitting or music storage.
- Off-chain: Delivered off the blockchain, including in-person events, physical merchandise, and general community development.
According to our dataset, 15% of LatAm music NFT releases offer utility beyond the core audiovisual artwork. These utilities often include off-chain benefits not directly expressed in the NFT metadata, including access to community, merch, or meet-and-greets We see the potential for significant diversification in the utilities around NFTs linked to music, including creative packages of all kinds of benefits that represent unique value propositions to their community, with independent artists leading the way in innovation and experimentation.
The most generalized types of utility link to:
One example of how NFTs can be helpful to cultivating music communities is through projects like Bohemian Groove’s Rip Coin. The label and collective have created and distributed NFTs that offer access to private spaces and experiences like Discord channels, sold-out shows, or album pre-releases. Rip Community-driven utility allows projects to provide additional value to their closest fans and promote the community around their work.
NFTs can also be helpful as a way of selling tickets, as is the case for ATROÁ CryptoPass in Brazil, which brings together festivals like Bananada, No Ar Coquetel Molotov, and DoSol, enabling broad access to events with a single NFT. Ticketing utility can be handy for projects with a solid following that want to offer their audiences the opportunity to attend several events without buying separate tickets.
NFTs can offer unique and personalized experiences to fans, as artists like Lali or Miranda have demonstrated. This utility can include private meet-and-greets, exclusive merchandise, and more. FUTURX developed the creation of Proyecto Gomez Casa’s NFT, offering exclusive tracks, a ticket to a show, and the possibility to eat a sandwich with a personalized recipe in a bar in Buenos Aires. These experiences can be precious for the most dedicated fans.
The importance of collectors
A music NFT collector acquires and collects music-related NFTs in their wallet. Collectors act as allies by valuing the content and work of artists; they can also participate in the music NFT community, sharing their collections with others while participating in discussions and activities related to the ecosystem at large. Generally, these discussions occur on Twitter and Discord, two platforms that have primarily contributed to developing Web3 communities and discourse.
Some collectors are also investors, as NFTs can increase significantly in value over time. In these cases, the collector acquires NFTs to resell them later at a higher price, or exploit the underlying artworks commercially to their own benefit through terms outlined by the selling artist or music brand. (It’s crucial to note that NFTs that include audio or an image only contain rights over them if this is explicitly clarified. Some artists use rights allocations to generate interest around a project, offering content under Creative Commons licenses and extending the possibility of receiving royalties to buyers.)
“The ones that impacted me the most were the artist collectors. If you like the art of someone who is a smaller artist, in the action of collecting the piece, you are generating value to that creation, that has a very strong impact. That’s why for me, the collector profile makes more radical changes in the life of another artist.” Basseado, Argentina.
There are two significant attributes to highlight about NFT collector behavior and preferences in Latin America, both related to how tight-knit the ecosystem currently is:
- Collectors are highly motivated to establish a framework for a regional Web3 ecosystem through their purchases and support.
- The collector ecosystem prioritizes artists who first support other projects as a precursor to regional recognition and support.
That said, collectors in the U.S. and Europe are also growing more interested in the Latin American music market, its sound, and its potential. This idea of a distributed collector base is one of the most delicate yet fundamental points for the progress of the NFTs and Web3 ecosystem in the LatAm region, balancing ongoing international outreach with the need to attract more native NFT collectors on the ground in the region.
“In terms of consumption of music NFTs, I don’t know if there are enough Latin American collectors, but the same can be said of the market in general. What’s really interesting is, on the one hand, that there are collectors who do not speak Spanish and are collecting pieces in that language. Additionally, there are Latin American communities outside the music ecosystem that are collecting music NFTs, demonstrating that there is a union between art and music collectors in our region.” Steph Guerrero, Ecuador / USA.
“I always try to establish connection with my collectors, we are in contact, sharing. I mean, being a collector is not just buying a NFT or having a prize and that’s it. I occasionally give drops, I have experimented with Black Friday, Cyber Monday, newsletters and other forms of sharing. I don’t see them as fans, I see them as my collaborators, my partners. It’s a way of going beyond our connection.” Alex Paul, Mexico.
Conclusions and future research directions
At large, blockchain technology has helped the music industry rethink traditional approaches to music creation, distribution, and monetization. In Latin America specifically, the Web3 ecosystem is still in an early stage of experimentation and development. Artists, festivals, and labels are eager to contribute to local industry development as well as augment their own creative projects with Web3 and NFTs, exploring new dynamics between projects and audiences and new ways of monetizing digital music experiences.
There are several outstanding questions and directions for further research on top of this report, including but not limited to:
- Case studies around digital marketing and community-building strategies for music/Web3 projects in LatAm
- Improving the fan and industry onboarding processes for music NFT platforms
- Legal issues surrounding music NFTs in LatAm, including how local norms around copyright, licensing, and royalty sales map (or not) onto the blockchain
- Strategies to reduce the regional music/Web3 gender gap
- Measuring industry and fan sentiment around NFTs
There remain challenges around making Web3 technologically and financially accessible to a larger group of creators, music workers, and audiences outside of its currently early-adopter niche. That said, the results of this report confirm that artists in LatAm are actively building the foundations for a new digital music economy, built on NFTs as the primary delivery format. There is still a lot of work to be done, and we hope to continue contributing with data, research, and insights to further develop this and other music tech ecosystems.
Alejandro Ramírez | Alejandro Romero | Alex Flores | Alex Paul | Angel Huerta | Anselmo Cunill | Aye Laurencena | Basseado | Bianca Battista | Brooke Jackson | Carlos H Cano | Caro Castilla | Claudio Cifuentes | Cherie Hu | Constanza Zarnitzer | Crypto Musica | Daiana Denise | Dalmiro Villanueva | David Duarte | David Levill | David Rodríguez | Diego Montes Barrenechea | Federico Romagnoli | Fernanda Prigoshin | Georgina Monti | Héctor Buitrago | Isabela Palacios | Julian Duque | Lucas Montalbetti (Quilla) | Luciana Balbi | Lucas Meyer | Macarena García | Marcus Martínez | Maria Isabel Alvarez | Mariano Martino | Mario Liendro | Mario Ruiz | Martín Giraldo | Matías Hinojosa | Matías Loizaga | Mia Lailani | Natalie Crue | Nicolás Madoery | Raul Guerrero | Rayo Estudio | Reo Nerva | Sergio Borromei | Steph Guerrero | Yaxx Castillo | Yung Spielburg