When people started getting into Bitcoin it seemed pretty clear that if things took off this would be a smart payment option to offer music fans. People into Bitcoin are a self-identified unique audience and in the early days of such developments a musician can sometimes raise their profile by early adoption. So I wrote about it quite a bit at Hypebot as a form of payment. But recent developments have revealed that Bitcoin gets even more interesting when you start building on top of it leading to such developments as “Artistcoin.”
Some Bitcoin Background
“A full copy of a currency’s block chain contains every transaction ever executed in the currency. With this information, one can find out how much value belonged to each address at any point in history.”
Here’s where it gets a bit weird and meta for me since I don’t fully understand what the heck I’m talking about. My current understanding is that the blockchain not only provides a sort of foundational history for the currency but also allows you to build another currency or exchange layer on top of that.
What I’m talking about is what venture capitalist Fred Wilson describes as the 4th and 5th stages of Bitcoin development:
“4) Commerce – real people buying real stuff with Bitcoin”
“5) Bitcoin as infrastructure – this is what prediction number 7 [evolving “beyond ‘store of value’ or ‘transactions’”] is all about.”
I was writing about the 4th stage at Hypebot and will periodically update here though likely in music revenue tool roundups.
But it’s this 5th stage that’s getting interesting because what Wilson is talking about is what the blockchain enables.
This is now relevant to musicians doing crowdfunding and going direct-to-fan due, in part, to services and musicians paving the way.
Bitcoin x The Blockchain = Artistcoin
I’m still sorting this out but this 5th stage in music ecommerce and crowdfunding is beginning to emerge. The following news item offers an explanation of where things are heading. Apparently Bitshares also coined the term “Artistcoin.”
“Bitshares…creates a decentralized exchange that uses a blockchain to create fungible digital tokens that are tied to the artist’s profile. BitShares Music has units that can be transferred much in the same manner as bitcoins…”
“A musician who uses BitShares Music would be able to create 10,000…artistcoins. He will then be able to sell or give away the tokens to his fans so as to fund his or her career. Each single artistcoin that he creates is recorded in the BitShares Music blockchain…”
“By buying an artist’s artistcoin, a fan would be investing in the artist’s success. In turn, each time the song is purchased, the new artistcoin holder can see the value of his portfolio rise and can cash out at any time. In addition, a fan can buy an artist’s artistcoin for speculative purposes, hoping that he might make something off it in the future.”
This approach is being explored in various ways. Here’s some related news:
To be continued…