"I'm Imagining a World Where Every Song Has an Investable Layer:" DJ 3LAU
Hello Defiers! In this week’s podcast, we interview Justin Blau, better known as 3LAU, one of the world’s top DJs, who is also at the forefront of the intersection between music and crypto. He became interested in blockchain technology because it can provide a means for fans to provably to own digital content, and for artists to better monetize their work. He believes this innovation has the potential to revolutionize the music industry. In his most recent project with non-fungible tokens, he teamed up with visual artist Slime Sunday to produce SSX3LAU, a project where they linked unique, Ethereum ERC-721 tokens, with motion graphics and unreleased soundtracks.
3LAU also talks about the immediate next step, with his plans to release a song from his own personal name, that’s linked to NFTs and tokenized on three layers. The song is called Everything and it will be dropping on Jan. 22. One layer is the artwork of the song itself. The second layer is the audio, which will be hosted on IPFS. The third is a physical layer, which will be the song represented in an acrylic block with the sound waves etched on to it. The block will have a QR code that links to the NFT. The auction will last just 10 minutes. It’s his way of answering the question, what does it mean to create a collectible layer of a song?
3LAU also talked about what’s next in this journey. He believes there will be a way for fans to invest in their favorite artists via tokens, and earn part of the royalties. This would allow artists to completely ditch record companies and share their success with their audience. The main blocker for this is regulation, as those tokens would likely be considered securities. But 3LAU believes this future is still just around the corner.
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Camila Russo: Here we are with Justin Blau. He is a DJ, also known as just Blau. He's frequently among the music producers in the major music festivals. He produces remixes for top pop stars from Katy Perry to Rihanna. Now he's exploring how music and crypto can work together. So super interesting what he's been up to, really excited to get into all of the details. So welcome, Justin to the show. Thanks so much for joining me.
Justin Blau: Thanks for having me.
CR: I’m really excited to hear about what you're doing in crypto. But I would love to just start from the beginning and get more into your background. I read somewhere that you ditched a job in Wall Street to start producing music. So we'd love to hear about that story.
Ditching Finance for Music
JB: I was in college at Washington University in St. Louis. I was studying finance and on track to go work at BlackRock Asset Management. I was studying derivatives in college, I love the entire world of finance still today, but music was taking off, thanks to Facebook and SoundCloud. A couple of my songs went viral, and I started playing at colleges across the country while I was still in college while I was a junior. So I decided to drop out of school and pursue music full time, and it ended up working out.
But in the background, I'd always had that passion for the financial world. Of course, as distributed ledger technology has been one of the most innovative and revolutionary forces in finance in the past decade, I always kind of had my eye on it as I was journeying down the music route. So that's kind of the quick background on me.
“Distributed ledger technology has been one of the most innovative and revolutionary forces in finance in the past decade.”
CR: Well, that must have been such a hard decision to make. If you're following your passion, it's not that hard, but still kind of risky to take that route of making music.
JB: I was lucky that my economics professor actually was able to convince my parents to let me drop out. At the time, it was just a leave of absence. I could keep my scholarship for eight years and I could go back and finish my degree whenever I wanted. So because he kind of gave me that option, it was a no brainer to give music a full shot.
CR: Did you ever finish your degree?
JB: I did not finish my degree. But maybe they'll give me an honorary degree at some point if I do something cool, we'll see.
CR: Maybe crypto will be your way to earning that degree.
JB: Well, maybe, very well possible. Very well possible.
CR: So what got you interested in blockchain and crypto in the first place?
Rethinking Art Monetization
JB: My first kind of discovery of the distributed ledger tech space was through the Winklevoss twins. I befriended through music and they were working on Gemini at the time that I kind of discovered Bitcoin and discovered the technology underlying Bitcoin. One of my earliest fascinations with the tech was how quickly and permissionlessly, you could transfer value without having to go to a bank to send a wire or programming a wire online. The idea that you can transfer value anywhere in the world within a short amount of minutes, I shouldn't say 45 seconds, depending on the gas fee, but the fact that you can move money around so quickly and permissionlessly was extremely interesting to me.
Then in 2017, when the ICO craze happened, I started seeing the potential of dApps and decentralized apps that could potentially disrupt the music business and make the music business a lot better. I've always been fascinated by the intersection of distributed ledger tech and music. But more recently, I've been super excited about the NFT space and its potential and engaging fans on a deeper level and its potential in making music a more monetizable and interesting product for an artist to pursue.
As you know, music itself has never been the main revenue source for a musician, it's always been the touring. But since you know COVID hit, a lot of musicians have been forced to rethink everything they know about their industry. NFTs has been an incredible outlet for myself and my art director, Slime Sunday, to monetize our artwork and in this crazy time. I feel really lucky that combined Slime Sunday and I've done close to half a million dollars in sales between both of us in the past four months of NFTs and we're just looking to expand upon what we built so far, and take our NFT game and collectible game to the next level.
CR: Let's backtrack a little bit. So you became interested in distributed ledger and crypto, and so you started looking at ways into how NFTs could connect with your audience and just make it a better way of just naturally monetizing your music. What exactly were your experiments with NFT's?
JB: Two years ago, in 2018, I threw a music festival that had a reward system that was powered by Stellar. Basically, if you were at the music festival, you could download the festival app and scan QR codes on site to earn kind of a non-transferable Stellar token that you could also redeem for rewards at the festival. This festival was called OMF. It was a great success. We had 8,000 people there. We had tons of Stellar transactions, a lot of people were scanning the QR codes to get their free nontransferable tokens.
But one of the things that we piloted was a Blau badge token. So if you found me wandering the festival, almost like a scavenger hunt, and you scanned my QR code on my phone, you got a one of 50 Blau badge that was an exclusive digital asset that you could only get in that moment, and by finding me at the festival. When we announced that, so many people were so excited about scanning my phone. It was just mobs of people that were super excited about obtaining this rare digital asset. At the time, it was just a fungible Stellar token, but that was the first time that I saw there was real demand for a collectible digital asset that lives on the blockchain. So that was in 2018.
As time went on, I started to kind of notice this trend in the visual art space, more specifically with Trevor Jones. Trevor Jones had sold editions of his CryptoBowl for, I think the highest one went for $55,000 on Nifty Gateway. That got me thinking, well, this is a new appreciation for digital creations that we haven't seen before. The reason why it exists on the blockchain is because of provenance and because of verifiability. ETH kind of uniquely powered this new movement, where artists could monetize their digital work. That we have never really seen before. Because when you think of something that's digital, you think that it's easily replicatable and easily copied.
“This is a new appreciation for digital creations that we haven't seen before. The reason why it exists on the blockchain is because of provenance and because of verifiability.”
So the fact that you could create a specific identity for a piece of digital art was super fascinating to me, especially because in the traditional art world, you have pieces that sell for millions of dollars. But digital artists spend just as much time on their art as a physical artist does. You know, painter might spend two weeks on a painting, or months and months of time on a painting. I very often will spend years on one song. But there's no way to kind of capture that value until what we've seen lately with the NFT space.
I started kind of exploring this stuff about four or five months ago, with exclusive audio reactive visual art. Now I'm starting to think about, well, what does a tokenized collectible layer of a song look like? Because just tokenizing the audio isn't really enough. That's kind of what I've been working on for the past month or so. More specifically, is what does it mean to tokenize a song. What are the different ways that that's possible? That's kind of what my focus has been lately.
CR: I'd love to hear more about how you've been experimenting with this idea of collecting a song, tokenizing a song. I know, you've already launched different collections on Nifty Gateways and selling NFTs linked to unreleased songs, all of that. Can you explain what that's about and how that's gone?
Song Tokenization
JB: Absolutely. So thus far, I kind of teamed up with my art director, and we created an alias called SSX3LAU or Slime Sunday Times Blau. Through that X3LAU, we've been releasing audio visual loops and pieces that have unreleased music and unreleased visual content. But I have yet to do a drop from my personal name just from Blau. Because I haven't really known what would make sense when you think about tokenizing just a song. It's been kind of a difficult problem that I've been struggling with.
It makes sense to tokenize a visual that has an audio component, but just tokenizing audio isn't interesting enough. So, more recently, I finally stumbled upon an answer to that question. What does it mean to create a collectible layer of a song? Because all my fans will go listen to the song on Spotify. You could buy the song for $0.99 on iTunes. But how do you create a limited edition of that song? The same way, there's only one Mona Lisa, but you can see the Mona Lisa on Google from tons of different places. How do I give fans and collectors the ability to have a limited edition of my song?
I kind of came up with this formula that we're piloting on January 22nd with Nifty Gateway. It's a formula that I'm really excited about. So on the 22nd, I have a new song called “Everything”, the name of the song is “Everything,” that's coming out. We've kind of created this three layer approach to what it means in making the song collectible.
Layer number one is the visual. So every song has artwork, or an album artwork. That's what people see when they're on Spotify, and they're playing the song. So one layer that we're tokenizing is the artwork of the song itself, which is the visual layer. The second layer that we're tokenizing is the audio. So just an audio file hosted on IPFS that's tokenized. The third layer is a physical layer, which is something that we haven't really explored yet. The physical layer is actually a sound block, so it's an acrylic block that has the audio waveform etched into it with a QR code that links to the NFT.
So again, we've kind of created this framework, which is a visual, audible, physical framework. So those three elements make up a collectible song. On Nifty Gateway, all you'll have to do is purchase the visual layer, and then we're planning on airdropping the audio layer and physically mailing the physical layer to those collectors. That would kind of be the first collectible song in existence to my knowledge, at least on a broader or mainstream scale. So we're extremely excited about it. It's our little experiment in our first pilot. But if it goes well, I imagine I'll be tokenizing all my future releases when they come out, and making those songs available for a very limited amount of time.
Let's say one of the songs goes on to be a huge hit. I imagine the collectible editions of the song that are limited in nature will have substantial value in the future. So that's kind of our short term approach to what it means to tokenize a song. In the long term, I would love to have collectors and buyers share in the royalties of the music itself. That would be achieved by a collector owning a portion of the master recording rights of the song via token, but of course, that makes the token a security. So that's another thing that I'm exploring and exploring the legalities of that I hope to launch in the next couple of months as well. The first step is just making a song collectible. The second step is seeing how royalties can be distributed to those who own a piece of the song.
CR:Wow, that's so interesting. So on the collectible song, can you take me through the mechanics of it? Your fans will be able to buy the visuals on Nifty Gateway and then they will also be able to access the IPFS file of the song itself, and then you would mail them the physical block with the sound wave etched on it?
Audio, Visual, and Physical Layer
JB: We can call it a physical token, right? It's a physical collectible of the song that will be limited by the amount of editions that are minted. Because a lot of these drops have sold out really quickly, we're actually doing this as an open edition. So within 10 minutes, as many editions are minted are the editions that will exist, and after those 10 minutes, no editions will ever be minted, and it will come from my wallet address, so it’s certifiably me. Anyone who purchases it on Nifty Gateway will have access to those three layers, that visual layer, the audible layer, and the physical layer.
CR: With the audible layer, though, anyone can really access that, right?
JB: So anyone can access the song on Spotify, but only those wallets that purchase the NFT will have the kind of limited edition audio file. So you can think of it as anyone can go look at a piece of Beeple artwork on his Instagram, but there are a limited number of people that actually own editions of that official artwork. It’s kind of the same thing.
CR: So the audio would be uploaded and linked to an ERC-721 token, correct?
JB: Correct.
CR: I'm sure you've modeled this or thought about this. How many people do you expect to participate in this 10 minute sale?
JB: Slime Sunday, my art director, he's done some drops on his own. He just did a similar idea, a visual physical hybrid, where anyone who purchased the open edition would also get a coffee table book that has a QR code that links to the NFT on it. He did 260 something in volume. Because it's only 10 minutes, we expect probably a couple 100 in terms of quantity, and those are the only editions that will ever exist. We're also going to do a one of one auction for a special edition that only one person will own. What makes that NFT a bit different is it will be a video visualizer of the songs that we're only going to create one of. So that's kind of the second layer to this. We anticipate like probably hundreds of people participating in the open edition and then of course, one of one for the auction.
CR: In terms of pricing, how does that work?
JB: Kind of whatever we set it. Just based on comps and previous sales, the open edition will be set at $999 and then the auction will go for whatever it goes for. So that'll be exciting.
CR: So the open edition is just set at that price? It doesn't increase or decrease with demand?
JB: It'll be set at that price for 10 minutes and then of course, people can choose to resell it if they want to in the aftermarket.
CR: How does the secondary market work for that? Is it wherever NFTs are traded?
JB: Nifty Gateway has its own secondary and then of course, people can withdraw the NFT from Nifty and install it anywhere, if they choose to. But the artist typically gets about 10% of the resales in terms of sales volume, and will probably be similar for this drop. But most of the platforms have their own native secondary markets, and then of course, because of interoperability, you can technically sell it anywhere you want.
CR: Then that leads me to this important question that I wanted to ask which is, how does this model of selling NFTs on these semi-permissionless or permissionless applications compare with selling your songs through record labels or just using Spotify to distribute them? You talked about how crypto enables a different monetization model for musicians and artists. How does it actually work out and compared to the traditional model?
Owning the Distribution
JB: I think people think of music, music’s always been pervasive in the sense that you can listen to it kind of anywhere. If you have a Spotify account, you can access a song. But no one who listens to the song actually owns the song, they don't have that direct connection to the music. They're just listeners. So we're basically just creating this layer that people can choose to own something through. That hasn't existed in the past, because anyone can kind of access the audio file, and once someone has it, they can download it, they can upload it to a variety of services. It's very easily piratable and downloadable for free.
But when it comes from my address, there's only a certain number of verified audio files that will ever exist. That's kind of the game changer, right? Because as a musician, we've never really been able to limit the distribution of a digital file. But now that we can, those people that feel a really strong connection to the song can have a limited edition of the song. So that's kind of the big turning point here.
“As a musician, we've never really been able to limit the distribution of a digital file. But now that we can, those people that feel a really strong connection to the song can have a limited edition of the song.”
CR: So it doesn't really stop people from reproducing your song and distributing it that way, but at least you do have control over this unique version of the song?
JB: Exactly. It's just like sneakers. If you think about, my favorite example, to use is Yeezys. There's so many fake Yeezys that you could buy for $40-50. They're literally the exact same sneaker as the real Yeezys. The parts are made in the same factories. They're almost identical in nature. They certainly work the same way. Right, a sneaker is the sneaker for the most part. But there's something that people really want. People want to own the real Yeezy, they don't want to own the fake Yeezys. It's really as simple as that.
People want to own the real collectible layer of the song because it's coming directly from me and because it has that unique nature to it. It's not just an audio file that's been copied. Granted, someone else can rip the audio and tokenize it themselves, but it won't come from my address, so it won't be verifiably real. We've seen the same thing in the traditional art world, where people will make limited edition prints, Andy Warhol prints still sell for millions of dollars, even though there are multiple editions of them. But you could easily just go online and print it on your own canvas and hang it in your house if you really wanted to, but you don't own that, you just copied it. Right? There's something that human beings really value in being an exclusive owner of something, whether it's digital or physical, and we're just kind of bringing that framework to music.
CR: In terms of what this means for the artists, so again, sure, you can't stop people from reproducing, copying your music, but at least, this gives you a way of benefiting from the upside if your music is becoming more and more popular, and people are wanting to own a piece of it, you can benefit from that.
JB: Exactly. So, you know, I obviously have a lot of songs that are out there already that we could tokenize if we wanted to. But it wouldn't really make sense, because some of those songs have already grown in popularity, there's no element of surprise or uncertainty with any of the existing music. So the reason why we're doing this collectible, we're piloting this collectible layer with a song that's coming out in the future. It’s because the collectible layer will be available the day the song comes out, and if the song does grow in popularity substantially, that collectible could be worth a lot more in the future. It's kind of nice to have that variable be unknown. Right? If the song happens to become super popular, all those initial collectors that supported me might see a huge benefit in their purchase.
So I think it's really exciting to create a collectible layer at the moment that a song comes out. I think that's really exciting, and this is the first time we're doing that. I think it's the first time anyone's doing that, at least to my knowledge, tokenizing, creating a collectible layer of a new song is not something I've seen. I've seen collectible editions of existing songs, but not something that's like brand new that's dropping the same day as the song itself. So I'm really excited to see how the collectors respond to it, and how my fans respond to it. I think it's going to be awesome, really excited.
CR: That sounds exciting. How much do you earn from that? As a percentage of the NFTs that are sold on Nifty Gateway, how much does that actually go to you?
JB: So in my case, through Nifty Gateway, it's about 80%. That's because Nifty has such a broad audience and a very loyal collector audience. Down the road, I imagine we can do direct to consumer sales, where I keep 100%. I think it's nice to have a partner in promoting a drop. I think any platform is certainly deserving of their commission. But in the spirit of decentralization down the road, I do think a lot of this stuff will be direct.
CR: Can you tell me more about this idea of just sharing rights with your friends?
Investor Fans
JB: So that's the next layer. That's the next level of what I really want to achieve. The idea of letting fans actually invest in the music itself, is super interesting, because music actually does generate quite a substantial amount of cash flows. It's been growing in the past five years, thanks to streaming services. The issue is that most artists don't own their own rights. They usually sell their rights to a record label early on in their career, and they don't really control their rights or ownership of the song at all.
In my case, most of my music has been released independently in the past five years. I control 100% of the rights. If I wanted to sell a portion of those rights to my fans, or to investors, those investors could potentially participate in the royalties and the cash flows from that music. In some cases, some of my songs have generated over $200,000-300,000 in royalty revenue.
I'm imagining a world where every song has an investable layer; so not only do you have a collectible layer of the song, but you also have an investable layer of the song, where collectors actually participate in the upside if the song is successful. The issue with that in the short term is that it's definitely a security. So if we were to do a sale, and tell collectors that they would participate in the royalties, we will be essentially marketing a security. But I do think that down the road, as the regulatory environment becomes more clear, and if people are willing to KYC in, we could easily do an equity issuance in my music today. It's just not as permissionless as distributed ledger tech we'd like it to be. So, in the long term, I do think that artists will start to raise capital from their fan bases instead of from a record label, and I think that would really help disintermediate music business in a huge way.
“I'm imagining a world where every song has an investable layer; so not only do you have a collectible layer of the song, but you also have an investable layer of the song, where collectors actually participate in the upside if the song is successful.”
CR: I think from NFTs and selling this collectible layer is certainly super interesting. But I think, this is what is really a game changer in terms of where the music business is going, because it really does give you a viable way forward to continue producing music without needing the support of a record label.
JB: Exactly. So this is kind of step one, and we have to start somewhere. Right? It's hard to go from zero to 100. I think step one is creating this collectible layer. But step two is definitely allowing collectors and fans to invest in the song itself. That's kind of my main mission. But I do think that, taking a step in the right direction is just as important, and down the line, we very well may integrate some of these concepts together. But things take time as you know, and it's definitely an exciting first step.
CR: So just to get this futuristic idea of music clear, the idea would be that a music producer would be able to say, okay, I'm launching a new record to his fans. Instead of taking a pilot or a sample song to a record label to sell that album and sell those rights, you would do that just through your own channels to your fans, and instead of having an ICO, you would do that with an album and with music, and people would invest in that?
Removing the Middle Men
JB: Exactly, and then they would participate in the royalties. So let's say we raise a million dollars for a new album and those token holders own 50% of the album, which, obviously, it's a security, but let's say hypothetically, in a hypothetical world, I could do it today. When the album generates its first million, we could either recoup those investors in full, and then they would participate in 50% of the upside beyond that. Or when the album generates 5 million, those investors would get 2.5X return on their capital as a whole. There's a lot of ways to think about that. But the securities aspect of music tokens is super fascinating, it's just difficult from a legal standpoint. But I think that the world is moving in that direction.
CR: As you said, an initial step might be just to do with KYC and then, you can do it.
JB: That's what we're doing. We're not saying it's a utility or anything like that. We're going to offer equity in my next album to investors, and we just have to KYC them. I'm working with a platform. I can't speak too much about it, because we haven't announced it yet. But I'm working with a very reputable Reg CF seed funding platform to do that. But in the short term, it's a simple equity investment. But in the long term, we'd love to tokenize those shares, so that the royalties can be distributed via smart contracts on a daily basis, assuming gas isn't crazy, maybe a monthly basis. But down the line, I do think that tokenized equity in a song or in a catalog of songs, is inevitable. It's going to happen and I'm really excited that I'm exploring it. In the short term, creating a collectible layer of a song is the easiest kind of first step in that process.
CR: So you're already working on that?
JB: I've been working on it for about a year.
CR: So interesting. Do you think there might be, in the future, like a secondary market for albums and songs?
JB: There actually is a market for, there's a platform called Royalty Exchange where you can actually sell master recording rights in existing music. A lot of institutions will buy catalogs like Michael Jackson catalog, or the Beatles catalog, like big, big artists. When you think of music, people have never really thought of it as a recurring revenue stream. Because in the past, in the iTunes days, you just bought at once and it was done.
In 2021, now that streaming has generated such a substantial amount of income, you can think of music very similarly to a real estate asset that has recurring cash flow. Now that owning those rights means that you're entitled to all future cash flows of that song or that group of songs. So it's still a very new realm. It's definitely only about five to eight years old, and we're starting to see a lot of people explore. I'm just super excited. It's one thing to issue equity in existing music, but it's even more exciting to issue equity in new music, because the upside potential for new music is quite a bit greater.
CR: So it's interesting that you said, this exchange happens today with big institutions trading rights to huge artists and albums. Would be interesting to see that become more democratized and it's not just institutions trading these rights, but just anyone.
Democratizing Access to Art Ownership
JB: It's not just you know, Scooter Braun buying Taylor Swift's catalog. What if everyone could own a piece of Taylor Swift's catalog? That's super exciting to me, because music kind of touches everyone. You could be a fan of an artist. If you were a fan of the Chainsmokers eight years ago, and you're investing in the Chainsmokers, eight years ago, how wealthy would you be today? These are real potentials that I think will feature democratizing access to these types of assets. It's something that I'm super excited about. This NFT collectibles is the first step in a long journey to do this with my music.
CR: I had RAC in my podcast a few weeks ago, now you're on. It seems like there's greater and greater awareness in the artists, musician, DJ community about crypto. You're obviously tuned in to this world. How are you seeing adoption and awareness of all? Do you see more and more talk about crypto? Is it still something that's pretty foreign to most artists?
JB: With a bull run happening now, I do think a lot more, more, more and more people are exploring it. RAC is a very good friend of mine. I would say that we are two of a few musicians that are really excited about the space and RAC has been involved even longer than I have, for a really long time, maybe four or five years. I've only been kind of active for about three or four. He and I talk very frequently about this.
I think the reason why we're both so passionate about the potential of distributed ledger tech disrupting music, is because musicians have always been taken advantage of. There's a great statistic that 88% of all the money that's generated by the music business goes to middlemen and artists keep about only 12% of the $40 billion that's generated annually from recorded music. So that's very ripe for disruption. There's a lot of middlemen that we could cut out along the way. Think RAC and I, as we're both technologists, and we both love to see how technology disrupts creative space.
I think more and more artists will come on board as they see more success stories. I think that's kind of the biggest driver for the mainstream to onboard is the more success stories we see, a success story similar to Audius where they've reached over a million monthly active users in a very short period of time. As we see more of those successes, more people will start to explore it. But we're all kind of early believers here and something that we all know will have many great effects on our creative world. It's just exciting to be a part of it and to be on the frontlines.
CR: I do believe bull markets have a way of obviously dragging people in with headlines and with price moves, but some ended up staying for because they see how radically this technology can actually change things and improve things.
JB: That was me too. I mean, I was probably driven via bull market, but then I stayed, because I was super excited, all of it. So it's kind of like there's a fish hook, and then you're sunk. In my case, I was kind of hooked in by the bull market in ‘16 ‘17 and then I ended up staying and I’m very active now.
CR: I wanted to ask you about social tokens still, that's also a tool for artists who monetize and connect with their fan base. So is that something you're exploring as well?
Social Tokens
JB: Social tokens for me are super, super interesting. I think that the infrastructure still needs a lot of work in terms of how social tokens actually flow to a mainstream user because you still kind of need to have an understanding of what three wallets and whatnot to really use that social token efficiently. I do think it's the future though. I definitely think that all artists will have some form of social token at some point in the future,and they'll all be freely tradable on a Uniswap of sorts.
But I do think we're still a couple years away from seeing that achieve mainstream adoption. It's something that I'm personally excited about, but I'm a little bit more focused on NFTs, and this idea of creating equity in my music, only because it's a little bit easier to deal with on the legal side. Social tokens are a little bit complicated.
“I'm a little bit more focused on NFTs, and this idea of creating equity in my music, only because it's a little bit easier to deal with on the legal side. Social tokens are a little bit complicated.”
On the legal side, I think there are great justifications for most social tokens being utility. I think most social tokens as they are right now are probably utilities, but there's also a little bit of securities risk in issuing a social token that I'm super sensitive to. That doesn't mean that I don't think anyone will get a penalty or pursued by the SEC, because it's not like people are raising hundreds of millions of dollars issuing social tokens. But I do think it's important to pay some mind to the regulatory environment, and how that might affect the issuance of social tokens. All that being said, I think the same way NFTs have seen this massive boom in the past year, I think, well, social tokens will see a similar boom in the next like two to four years.
CR: To wrap up, what do you think is missing for artists to become more involved in crypto and to use these tools? What would you like to see built this year?
Improved UX for Newcomers
JB: I think UX/UI is the biggest barrier. I think that MetaMask is difficult for a new user. I think that wallet tools need to be a little bit improved for the mainstream before we see this massive influx of users. But platforms like Audius are doing that. They kind of demystify and hide the distributed ledger tech component of the app so that it just works for any user who wants to sign up. There are more and more people that are creating mainstream-friendly UI/UX experiences. As those tools are created, I think we're going to see more adoption.
CR: I don't know if you call it experiment, but starting out with this NFT, for the first NFT for an original song for an unreleased song, is the idea to make all your songs, to release all your songs this way?
JB: The idea is to create a new format for all my future songs so that people can purchase this collectible layer as these new songs come out. Another thing that we're going to experiment with is tokenizing unreleased music, but without it being just a partial song. So all the NFTs that we've issued thus far have all been segments of a song instead of the full song. I would love to tokenize unreleased songs as full songs as complete ideas, and have those be exclusive to those collectors. So it's kind of probably the future looks like a combination of tokenizing new songs as they come out, and then also tokenizing unreleased songs as full songs. These are kind of the two things that I'm exploring while we get ready to do an equity issuance in my next album.
CR: So exciting. Well, Justin, thank you so much for taking the time. This has been super interesting. Really looking forward to seeing all this come to fruition.
JB: Same, thank you so much for taking the time yourself. I’m a huge fan of the podcast and of the publication. Hopefully, all the listeners enjoyed the talk.
The Defiant is a daily newsletter focusing on decentralized finance, a new financial system that’s being built on top of open blockchains. The space is evolving at breakneck speed and revolutionizing tech and money.
