Royal.io is disrupting the music industry with the help of blockchain technology and solving the issue of piracy that has plagued the industry for a long while. Furthermore, it has provided a platform where musical artists and fans can relate and trade with one another without the need for an intermediary. Here, artists sell part of their royalty rights as an NFT, and buyers earn money on every stream. Let’s take an in-depth look into how this blockchain-based music platform is changing the game.
What is Royal.io
Royal.io is a music NFT marketplace that connects artists directly with their fans. Founded by Justin Blau (also known as DJ 3LAU) and JD Ross, the platform allows artists to sell a part of their royalty rights in the form of an NFT. Meanwhile, users and fans have the opportunity to make money from the song they invested in.
Before the advent of a platform like Royal.io, fans who are interested in purchasing rights to a song would have to go through music publishers or other centralized royalty marketplaces. But now, Royalty has created a mechanism that eliminates the need for a third party as anyone can easily purchase the ownership of a song directly from the artists. These fans or users become investors who are invested in the artist’s success as they are more motivated to see the streaming numbers go up, which would mean more money for them.
The marketplace currently features songs from Nas, 3LAU, The Chainsmokers, Anderton and Yemi Alade. These tokenized songs are grouped under three investment tiers – Gold, Platinum, and Diamond. The Diamond editions typically cost more than the Platinum and Gold editions. Those who purchase the Diamond editions also earn higher percentages from the streaming rights and enjoy more perks from the artist.
How does Royal’s NFT Royalties Work?
Royal.io utilizes blockchain technology (the platform currently runs on Ethereum and Polygon) and a system of smart contracts to make these tokenized music royalties work. These smart contracts ensure that the payments are automatic and that the NFT agreements are met. The artists chose what percent of their song’s royalties they are allocating to each token and what additional perks like autographs, special tracks, and fan experiences, will be added to it. The fans or users can then purchase these NFTs directly from the artist. Once purchased, they own a right to claim the percent of the royalties stipulated in the NFT conditions after it has accrued. The artist usually determines the payout period to the owners of those NFT royalties.
The user can also sell these NFTs the same way other tokens are traded on NFT marketplaces like Opensea and Blur.io. However, the user loses all the future royalties and perks that come with the NFT once another trader purchases it. The royalties and perks become the right of the new buyer.
Is the Artist Selling All The Rights in Their Song?
Fans only get a percentage of the “Streaming” royalties by purchasing these NFTs. The rate could be as low as 0.1165% for the gold edition and as high as 5% for the platinum edition. They also have use rights of the song for noncommercial use, i.e, the same rights buyers have when they purchase a CD or download the song from a streaming site. This ‘NFT royalties’ arrangement doesn’t affect the other royalties like publishing, songwriting, and mechanical, which artists may be entitled to. The artists, or their record label, still retain the rights to the song and are only selling a percentage of what they could earn through streaming services.
Platforms like Royal.io provide an excellent avenue for artists to make additional money from their streaming royalties right while fans have the opportunity to invest in the success of their favorite artists while also making passive income from them. Above all, it is an excellent win for the music industry as it greatly reduces the piracy rate and creates a new revenue model for artists.
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