A Perspective on NFTs in the Arts-and-Music Industry*

Abstract

Abstract Significant interest in non-fungible tokens (NFTs) as a means of changing the music industry has motivated this investigation. First, a comprehensive literature review (of strengths, weaknesses, opportunities and threats [SWOT]) provides a summary of the benefits and costs associated with the deployment of blockchain- and NFT-based transactions in the music industry. Considerable effort has been devoted to identifying the economic, legal and regulatory benefits and drawbacks of applying the new technology. NFTs may be the final realisation of the digital universe, bringing exclusivity and revenues to the creator economy and the chance to revalue creative work. The technology's drawbacks may exceed its advantages. Navigation within the crypto regulatory landscape is still deemed as exploring uncharted territory. It is further complicated by the fact that it is largely uncertain which legal framework may apply due to the lack of jurisdiction-identifying criteria. Second, quantitative research is conducted as an online survey directed towards two research questions: 1) What is the extent of familiarity and knowledge related to NFTs, as well as perspectives on NFTs as potential disruptors? 2) What is the extent of music creators’ perception of NFT-related opportunities and NFT integration into the music industry? Twenty EU countries were selected for the survey. Respondents answered twenty questions focused largely on demographics, their awareness of NFTs and their perceived potential for disrupting the music industry. It is too early to say whether NFTs will be utilised successfully, especially by independent musicians. The arguments in favour of NFTs are compelling, but there are issues regarding the levels of awareness and competence required for implementation.