Saxo Bank: NFT music platforms will challenge Spotify in 2022

Saxo Bank

TL; DR Breakdown

  • Saxo Bank predicts the rise of NFT music platforms in 2022
  • NFT music platforms will provide more income to musicians
  • SPOT sees decline despite the massive inflow of revenue

Since its inception in 2009, the crypto sector has undergone a massive upgrade to provide more than the use case it was designed for. When Bitcoin was developed in 2009, Satoshi Nakamoto wanted a peer-to-peer payment system. Over the last couple of years, we have seen the sector infused in other aspects such as payments, services, and the likes. A recent prediction by Saxo Bank has tipped NFT streaming websites to leapfrog top streaming websites by 2022.

NFT music platforms will provide more income to musicians

According to Saxo Bank, major streaming platforms take a larger share of musicians’ profits while giving them the smallest part. With this, the platform believes that using NFT based streaming platforms might help them recoup huge profits. Saxo Bank believes this postulation because most streaming platforms have third-party services that cut a small chunk from musicians’ income. With NFT based streaming platforms, this is not the case as they have eliminated all third parties, providing direct access to the consumers. According to a review by an in-house analyst of Saxo Bank, about 75% of the total revenue on a song is shared by the platform and the record label, leaving the musicians with just a little below 25%.

SPOT sees decline despite the inflow of revenue

Saxo Bank believes that the small successes enjoyed by platforms like Audius this year could trigger a wide entrance of other NFT based streaming websites. Notably, Audius has enjoyed partnerships with top artists in the music industry, such as Jason Derulo and Katy Perry. Audius provides a musician to listener feel for all parties, eliminating third-party fees.

Saxo Bank also believes that platforms like Spotify might witness a hit in their value come 2022, predicting a decline by 33%. SPOT, the stock of the streaming platform, took a hit around august after declining to trade at $204 from a high value of $300 it started the year with. Presently, Trading View data shows SPOT to be around $229. In the same vein, Spotify has continued to enjoy a larger share of the income, making the prediction an easily realistic one.

Spotify finished last year with $9.5 billion, a massive 16% increase from its performance in 2019. However, its value is expected to grow as the firm witnessed a massive entrance of users during the first quarter of this year. Spotify is also looking for a way to enter the crypto scene after it announced that it wanted a partnership with someone well versed in the sector.

Owotunse Adebayo

Owotunse Adebayo

Adebayo loves to keep tab of exciting projects in the blockchain space. He is a seasoned writer who has written tons of articles about cryptocurrencies and blockchain.

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