NFT’s Can Make Spotify a Fintech Company
Wait, what’s an NFT? A non-fungible token, or NFT, is basically a digital asset that isn’t interchangeable. Imagine buying a digital painting, that would be an NFT.
Ok, why would anyone buy a digital painting? I had the same skepticism about a month ago until I realized this is the digitization of the collectibles industry. If people pay millions for a unique baseball card then why not something similar that is digital?
Still doubtful? The NBA made an NFT website where fans could buy digital collectibles such as owning a moment of a game or an image. So far, it’s made $230 million of revenue!
So how does Spotify relate to this?
Spotify and NFT’s
Alright, Spotify provides music, what do they have to do with NFT’s?
Everything.
It’s become a common social trend to post the popular Spotify screenshot showing that you were one of the first X% of Spotify listeners for artists. After all, if you were able to spot the next big artist before everyone else, then that’s a pretty big flex.
So, what if artists could sell a limited amount of NFT’s per album or song that they create?
As a user, people would buy these NFT’s as a bet that this artist would make it in the future. If the artist did, then their NFT would be worth considerably more! This is similar to the concept of how people used to buy limited edition records in the 20th century. A Beatles record once sold for $790,000!
Spotify could bring back this trend, allowing listeners to support their favorite artists in a new way while also standing to benefit if they succeed!
In the process, Spotify could potentially generate potentially hundreds of millions of revenue and would become a marketplace for selling music NFT’s! For instance, the same NFT could be sold 10–15 times throughout its lifetime perhaps and Spotify could make a 3% fee each time!
It’s a Win-Win-Win
The music industry is notorious because its artists are often paid the least out of any creators. In fact, it’s estimated that musicians only get 12% of revenue that their music brings in! This often leads to early stage musicians struggling financially despite gaining decent traction.
With this new NFT system, creators would have a new way to gain revenue at a much higher percentage to support themselves. Meanwhile, this would take heat off music distribution apps such as Spotify while integrating well into their existing MerchBar feature.
Users would be able to better present themselves digitally and could share this NFT as a symbol of their personality digitally while also being able to trade/sell music NFT’s for a profit in the future.
The Digital Home
Where do you live? I would argue that we all live in the same place: the Internet.
Traditionally, people would come to each other’s homes to learn more about each other. The paintings or records one would have symbolized their love for a sport, a team, a musician, and so on. In a similar sense, we have to create this for our digital homes.
Currently, people connect their Spotify profiles to show what music they listen to but we can change this by adding NFT’s to better display our digital personalities.
Seeing how large Spotify is, they have the technology and brand name to be the one provider of NFT’s for musicians and simultaneously allow users to share these NFT’s online for as long as they own it.
I imagine, digital picture frames will soon become significantly more popular as people may even choose to show NFT art in their homes over real art. In the 20th century, people bought records. In the 21st century, we’ll buy NFT’s to symbolize our passion for something.
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