Ryoma Martin | September 7 2022
Ryoma Martin | September 7 2022
Orion and the Emergence of DeFi in the Music Industry
Orion Protocol provides the best tools to stay on top of the emergence of DeFi in the music industry. These days, many musicians struggle to earn a fair share of the profits generated from their work. From negotiating with music publishers to the pervasiveness of peer-to-peer file sharing technologies, everyday musicians often get the short end of the stick.
Modern platforms like Spotify or Pandora offer plenty of convenience to music fans but do not make it easier for musicians to get by. However, with the growing applications of blockchain technology, the Web3 ecosystem is starting to produce resources that could throw musicians a much-needed lifeline. By leveraging the decentralized nature of crypto, DeFi may finally be able to cut out the middleman from the hard work of those who produce original musical content.
Most DeFi projects in the music industry are still nascent in their growth and are often only available on lesser-known exchanges. Orion Protocol’s platform for aggregating exchange liquidity is a one-stop solution to access any crypto coin or token in the music industry you may look for. Not only that, but tools like the Orion Swap Widget and Virtual Order Books (VOBs) on the Orion Terminal make it even easier to conveniently swap, trade, and contribute crypto in whatever form necessary to make the most of DeFi’s impact on the music industry.
Challenges Faced by Contemporary Musicians
Many in the music community initially embraced the emergence of popular streaming platforms in music as it offered an alternative to widespread online piracy. The total revenue of American music licensing and sales were nearly $15 billion in 1999. A decade later, in 2009, it reduced to just over $6 billion. This illustrates the value wiped from the music industry as the sales of physical albums declined. A recent resurgence in the popularity of vinyl records and other forms of physical media has led to growing revenue in the music industry once more, but this growth does not reflect in the compensation for artists.
Spotify and other streaming services bring in monthly subscription fees from music fans, but their payout to artists per stream has remained notably low. Some streaming services, including Tidal and Apple Music, offer higher payout rates to artists than Spotify does. These rates, however, remain far beneath what even artists who accumulate hundreds of thousands of streams per month need to make a living off their music.
COVID-19 has compounded the challenges associated with making a living as a musician. In today’s streaming landscape, it has become the norm for many musicians to turn to relentless touring and selling of merch as primary sources of income. However, the threat of pandemic-related tour cancelations, besides rising costs associated with inflation, has made the touring landscape tougher than ever, especially for up-and-coming artists. For many in the music industry, it has become clear that new compensation strategies that sidestep unscrupulous streaming platforms and middlemen are necessary. DeFi offers direct and decentralized fan-to-artist compensation, absent of the processing charges and other fees seen even at artist-friendly platforms like Bandcamp.
Music Remuneration Solutions Made Possible by the Web3 Community
Web3 refers to the concept of a new iteration of the internet that makes use of blockchain technology and token-based economics to create a landscape that is more decentralized, to combat the power and influence of Big Tech. It’s common for new technologies to be first embraced by artists, who are often idealists and freethinkers looking for innovative solutions to the pain points they face. For example, in 2021 the rock band Kings of Leon was the first band to release an album as an NFT, and many others have since followed suit.
Decentralized finance solutions could help to lessen the stranglehold that centralized institutions have on financial services used by musicians and their fans. DeFi platforms can allow for nearly instant and nearly free transfers that can build into new artist compensation platforms that are equitable, allowing fans to support artists more directly and allowing artists to garner higher earnings.
Orion Protocol and the Future of the Music Industry
One challenge in the way of DeFi’s ability to facilitate compensation for musicians is the staggering array of exchanges, both centralized and decentralized. When you factor in the mind-blowing abundance of digital assets available to users, it’s clear that the landscape needs improvement to be made simple and user-friendly. Many crypto users are familiar with the frustrations associated with accessing numerous wallets and exchanges to have access to digital assets. Orion Protocol addresses this issue head-on as a liquidity aggregator that lets users trade crypto assets at the best rates available.
Trading assets using Orion’s liquidity of crypto assets creates convenience by using the Orion Swap Widget. The widget gives users easy access to Orion’s aggregated liquidity on any website, not just Orion’s powerful Trading Terminal. Website owners can add the Orion Swap Widget to their websites for free, and setting up takes under fifteen minutes. Visitors to sites with the Orion Swap widget are granted instant global access to crypto tokens at the best prices.
By having the resources of the Orion Terminal embedded right on their websites, artists can provide users with the ability to easily trade cryptocurrencies from their own wallets. An increasing number of new DeFi-powered music streaming platforms have their own cryptocurrencies that directly compensate the artists. The Orion Swap Widget offers a seamless way to trade between these cryptocurrencies, facilitating fair compensation for musicians and other artists.
For now, big streaming platforms have not created a landscape where compensation for musicians directly relates to the value they provide, and change is needed. Orion’s vision and how it contributes to the growing DeFi and Web3 landscapes can provide a needed link between crypto and the music industry, encouraging a future wherein artists receive payments fairly, directly, and instantly from the fans who engage with their work, using blockchain technology.