How can an independent artist build a vibrant career? Past iterations of this problem statement have considered this a one-sided question of patronage or exchange: what might an artist offer their audience for maximum profits?
At Decent, we view artist monetization as a question of incentive alignment: how might an artist and their fans share in value jointly created? To answer this question, we need to move beyond patronage.
The primary financial metric for success in music NFTs should not be how much an artist can charge their fans at mint. Rather, it should be how much the fans can generate for and with the artist post mint. This novel goal requires a novel design.
Harrison First has committed 40% of streaming royalties to his song “The Garden/Against The World” for the next three years. NFT editions will be minted for 0.1 ETH. The Garden/Against The World will hit streaming platforms on Friday, May 6. NFT editions will be minted on Monday, April 25, 2022 at 10:00 am EST for 0.1 ETH. Fans will be able to listen to the song exclusively on Decent beginning 1 hour prior to the drop.
Harrison’s release on Decent will enable fans to stake NFTs in exchange for $FIRST tokens. Fans will be able to support Harrison by purchasing NFTs from his limited edition release. They can then lock their NFTs for monthly increments to receive $FIRST tokens, denoting ownership in Harrison’s artist community. All future releases of Harrison’s on Decent will be eligible for $FIRST token rewards. $FIRST tokens enable Harrison and his fans to share value jointly created past his initial mint.
To maximize value for artists and fans post-mint, Decent will use Harrison’s NFTs as an identity credential and $FIRST ERC-20 tokens as a liquid, gamified application layer. This structure separates reputational and financial motivations, increases accessibility and participation, and facilitates mass coordination through economic and social incentives.
Scarcity value is predicated on the economics of luxury goods. If the goal is to bridge NFTs to tens of millions of retail users, scarcity value will not be sufficient. Mainstream NFTs will derive their community and economic value from their utility within a broader game or DeFi primitive. With Harrison, Decent is unveiling a new structure*:
*Kevin Yu & Jad Esber’s papers on reputation are our favorites and helped shape our thoughts for this structure.
A tangent on why participation is so important in music: artists might prefer a limited edition release to a 1of1 because there are network effects to 25+ people invested in your success vs. one. We’ve written some about information cascades in curation markets, but the core premise is that the benefits of 25 people telling their friends about an artist vs. one accrue very quickly.
Metcalfe’s law (network effects) applies to cultural phenomena, and mass agreement on taste dictates fundamental value in curation markets. For example, a song is typically valuable because it is popular, it is popular because higher quantities of people agree they like it than other songs.
Our goal is that artists become more popular and fans share in the value jointly created. In music, value accrues to the highest number of people in agreement on a song or artist’s quality. Therefore, we believe artists’ NFT communities should have uncapped participation and grow stronger with each new member.
Scarcity value is a red herring obscuring higher-value outcomes. Exclusivity feels important, but why? It is not how fans consume music, and it is not what artists hope for their songs.
We are excited about Harrison’s release as a first step beyond patronage towards more exciting post-mint relationships between artists and fans. Monday’s mint should be thought of as a ticketing turnstyle into the $FIRST community. Community and economic value are principally a function of the coordination and efforts of those inside vs. a bottleneck at the turnstyle.
We would love to hear thoughts and feedback from you. Join us in our Discord and follow us on Twitter to keep up with and contribute to the Decent community as we build.