COMMUNITY minting NFTs , some fetching millions of dollars . Music NFTs are a cross between a Go Fund Me campaign , a merch table experience and stock ownership . Imagine contributing to your favorite band ’ s Go Fund Me campaign for their next record , but instead of receiving concert tickets you receive a percentage of the revenues in return . Bundled music NFTs – like a diversified , music mutual fund of musical artists – may be available for fans and investors to purchase soon .
NFTs are not without their risks . Besides speculation and volatility , the nascent NFT industry may be impacted by numerous practical and legal issues as it grows .
Before we get knee deep into NFTs , including blockchain , crypto , decentralization , and Web 3.0 , let us first remember how we got here .
Technology and Music – A Bumpy Road
It seems like a distant era now , but early recording devices in the late 1800s were the original disruptors of the music industry . The phonograph , for example , enabled music “ on demand ” for the first time . Listeners could consume music at home , and this development threatened the live concert and sheet music industries . In the early 1900s another avant-garde technology – player piano rolls – spurred litigation that resulted in “ mechanical ” rights being recognized under US Copyright law for the first time . The mechanical license endures today , requiring music distributors ( from CDs to streams ) to secure a mechanical license before reproducing music with the aid of a machine .
The emergence of radio caused fears about the demise of the phonograph record and concert industries because consumers could listen to their favorite music for free via the airwaves . Some years later MTV became the disruptor , somewhat to the detriment of radio , and aired a prescient first video that pronounced : “ Video killed the radio star .”
The sky fell again on the music industry when digital technology and compact discs hit the mainstream , allowing “ lossless ” copying for consumers , and stoking fears that the recorded music industry would suffer since perfect sound recording copies could be made at home . Digital technology also led to sampling – “ lifting ” a sound recording from one recording and “ placing ” it in a new recording – which permeated rap and hip-hop music in the late 1980s and early 1990s . Courts pronounced bright line rules against sampling , including , “ thou shalt not steal ” and “ get a license or do not sample .”
Of course , many of us remember the seismic shift that occurred when broadband internet and file sharing technologies converged , leading to rampant internet piracy and highprofile litigation against file sharing companies like Napster and Grokster . A non-music company , Apple , ushered in the iTunes era , which halted some of the music piracy . Who would have thought downloads would go the way of the 8-track so quickly , when Spotify and digital streaming overtook downloads only a short time later ?
So , where does that leave us now ?
NFTs – What the …?
An NFT is an acronym meaning “ nonfungible token .” It is a unique digital asset stored on a blockchain ( more on that below ). In other words , it ’ s a collectable , like a piece of art , a trading card , or anything else . It comes with a digital receipt – proof from the seller that the item is authentic and limited – and the scarcity and authenticity of NFTs tend to make them valuable .
NFTs exist on the decentralized web , known as Web 3.0 . Web 3.0 is the newest iteration of the Internet , a disaggregated model operating on public blockchains rather than on platforms operated by tech giants . In other words , navigating Web 3.0 no longer means logging onto Facebook , Google , or Twitter . It seeks to democratize access to information .
Blockchain is nothing more than a public ledger . The ledger contains records , called blocks , and since each block contains information about the blocks previous
NFTs are not without their risks . Besides speculation and volatility , the nascent NFT industry may be impacted by numerous practical and legal issues as it grows .
to it , they form a chain . They are linked together using cryptography , making them very secure . Blockchains are resistant to modification because , once recorded , altering one block would require altering all subsequent blocks . The ledger is verified through a consensus mechanism across disaggregated computer servers , without the need for middle people . Think about that for a moment . Bitcoin , a Web 3.0 token , exists without a central bank or government .
Tokens in real life are physical representations of something . For example , arcade tokens in the 80s were purchased with quarters , and to the holder , each token represented the opportunity to play one game . In Web 3.0 , a token is a digital representation of something . For example , cryptocurrency , such as bitcoin or ether , are tokens that represent a store of value . Because one is interchangeable for another , they are considered “ fungible .” By contrast , nonfungible tokens represent ownership of something unique , such as a piece of digital art . CryptoPunks , released in June of 2017
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