While many musicians have used non-fungible tokens (NFT) to connect with their fans, MODA DAO is using the digital tokens as a governance tool for artists and their managers to control royalty contracts.
The decentralized autonomous organization (DAO) is pairing its NFT music streaming platform with its governance token, MODA, which is set for release on multiple blockchains, MODA DAO announced Tuesday.
The company said it will release a portion of its token supply on the Ethereum, Fantom, Near and Polygon blockchains by the end of November.
Artists have released their music and concert tickets as NFTs before, but governance through NFTs in the industry remains uncharted territory. The concept has caught the attention of electronic music producer and performer deadmau5, who is backing the project as an advisor and DAO member.
“I see the Web 3 ecosystem growing alongside streaming services, and eventually becoming more significant to the artists,” deadmau5 told CoinDesk in a statement. “This new [MODA DAO] world is creating new ways for artists to take ownership of their music, but it will take a while to scare the Spotify and Apple Musics of the world.”
With a MODA token, artists can register their music to be streamed on the MODA DAO platform. The company is targeting musicians and their managers as token holders, giving them a say in the royalties they receive for music released on the platform.
Revenue earned from songs published on the DAO’s platform is split three ways among the artists, the rewards pool and a token buyback program. MODA DAO told CoinDesk that it’s also working toward creating a decentralized finance-type lending program where artists can loan against their musical IP on-chain.
MODA DAO also gives token holders access to in-house blockchain products such as its new “audio fingerprinting” technology, which allows artists to mint and sell raw audio files of songs as NFTs before the songs have been approved to be published on platforms like Apple Music and Spotify.
MODA DAO raised $5 million in a private token sale in October and says it manages more than 10 billion music streams per month.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.