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Mainstream buzz around NFTs is fading, but the Web3 music space is quietly gaining momentum. Sales volume across the top 10 projects in October rose sharply for the second month running, largely driven by a high-profile drop from Warner Records’ new Web3 label and a new project featuring Linkin Park‘s Mike Shinoda.
Independent artists are also building strength, with primary sales doubling in October on Sound.xyz — the leading platform for independent drops — to a total of $200,000 according to Token Terminal. Meanwhile, last month saw a music project on the Solana blockchain enter the top 10 for the first time.
Total volume across the top 10 climbed 50% in October to reach 2,164 ETH. In dollar terms, the volume climbed 73%, hitting $3.38 million helped by the rising price of crypto. Based on analysis of sales data from 19 different NFT platforms, independent releases and secondary sales volume on OpenSea, here are the 10 biggest-selling music NFTs and collections in October 2022.
1/ Probably A LabelMonthly trading volume: 1,196.95 ETH ($1,873,226 at month-end conversion rate)Primary sales (Oct.): 499.95 ETHSecondary sales: 697 ETHDrop date: Oct. 6
Probably A Label is the new Web3 imprint from Warner Music UK. It sold 5,555 NFT access passes at the start of October, minting out in seven minutes through an exclusive drop page on OpenSea. NFT holders will shape how the label is run, collaborate on the development of a virtual artist and even share IP rights in some future projects. “This is a vehicle for us to explore new ways of working as a label,” Sebastian Simone, vp of audience and strategy at Warner, tells Billboard. “We believe Web3 allows artists to create with more freedom and connect with fans on a much deeper level.”
The label is a joint venture with Probably Nothing, an established Web3 brand founded by former restaurateur Jeremy Fall. The team is now preparing the first airdrop for holders — a free music NFT featuring production from Diddy.
View the collection on OpenSea.
2/ SAN OriginMonthly volume traded: 502 ETH ($785,630)Primary sales (Oct.): N/ASecondary sales: 502 ETHDrop date: Sept. 16
SAN Sound is a project that aims to launch a Web3 music streaming service, using a “listen-to-earn” model where holders earn crypto tokens while streaming. It exploded to the top spot in September and remained strong in October through secondary sales.
Over the last month the project has encouraged holders to ‘soulbind’ their NFT — which ties it permanently to their wallet — allowing fans to access the streaming platform. Those that bind their NFT will also be eligible for a free airdrop of governance tokens enabling them to vote on how the platform develops.
View the collection on OpenSea.
3/ Secret Garden – “Wind Chime ft. Mike Shinoda”Monthly volume traded: 153 ETH ($239,445)Primary sales (Oct.): 114 ETHSecondary sales: 39 ETHDrop date: Oct. 12
Secret Garden is a unique beat making tool built on the Ethereum blockchain. Fans can interact with it by choosing which stems (drums, bass, synths) to activate until they find a beat they like. The project had some early success through collaborations with electronic producers Robotaki and Smle, but Secret Garden launched its biggest mint yet in October with Mike Shinoda.
Shinoda joined the project as an advisor and created the music stems for the latest Wind Chime collection. It sold 2,000 NFT players and went on to generate 39 ETH in secondary sales. Secret Garden is under the umbrella of the Capsule House NFT project which is among the most successful anime profile picture (PFP) projects founded by renowned digital artist Seerlight.
View the collection on OpenSea.
4/ KINGSHIP – “Keycards”Monthly volume traded: 85 ETH ($133,025)Primary sales (Oct.): N/ASecondary sales: 85 ETHDrop date: July 15
The Bored Ape Yacht Club band remains in the top 10 for the fourth month running due to strong secondary sales on OpenSea. In October, the project teased an upcoming airdrop where holders will get a free NFT or item sent to their wallet. Producers Hitboy and James Fauntleroy are still busy in the studio preparing music for the project.
View the collection on OpenSea.
5/ BlocktonesMonthly volume traded: 49 ETH ($76,685)Primary sales (Oct.): N/ASecondary sales: 49 ETHDrop date: Sept. 16
Founded by Grammy-winning producer Gino the Ghost, Blocktones is a collection of 2,500 generative music NFTs. Each one was created using a random combination of music stems. One of the collection’s rarest NFTs, with production by Timbaland, sold for 5 ETH ($7,825) this month. The team also ran an experiment where holders could sign a non-exclusive license using their wallet to allow Blocktones to stream their NFTs on a YouTube radio channel. Holders were sent $10 back as a royalty straight to their wallet.
View the collection on OpenSea.
6/ Alan Walker & Ava Max – “Alone Pt. II”Monthly volume traded: 46.6 ETH ($72,929)Primary sales (Oct.): 35 ETHSecondary sales: ~11.6 ETHDrop date: Oct. 20
“Alone Pt. II” is among the biggest dance tracks in the world with almost 500 million streams on Spotify. Now, fans can own a small piece of the future streaming royalties. This is the third drop launched on rising platform Anotherblock.
The company typically partners with a songwriter or producer to unlock a small percentage of a song’s streaming rights. In this case, the ownership share comes from The Very Good — the publishing company behind many of Sweden’s biggest songwriters. “The Alone Pt. II” drop offered 500 editions, each granting 0.001% of future streaming royalties.
View the collection on OpenSea.
7/ Daniel Allan – “Glass House Remixes”Monthly volume traded: 35.02 ETH ($54,806)Primary sales (Oct.): 9.9 ETHSecondary sales: 25.12 ETHDrop date: Oct. 20
Independent artist Daniel Allan first appeared on this list back in July with his landmark Glass House collection. Now he returns with the remix package. Allan dropped four remixes from the Glass House EP via Sound.xyz’s new protocol — allowing him to host the drop on his own website and Sound.xyz simultaneously — making almost 10 ETH in primary sales. He also generated a flurry of secondary sales on this collection and his back catalog through October.
View the collection on OpenSea.
8/ Oshi – “U&I” and “Fight For This”Monthly volume traded: 27.84 ETH ($43,569)Primary sales (Oct.): 10.54 ETHSecondary sales: 17.3 ETHDrop date: Oct. 6
Independent artist Oshi has been at the heart of the Web3 music scene since 2020. He was also the first artist to release an NFT on Sound.xyz when it launched in 2021. In October, he dropped two new tracks, generating more than 10 ETH in primary sales. Secondary activity also picked up with around 17 ETH traded on OpenSea and Sound.xyz’s newly-launched marketplace.
View the collection on OpenSea.
9/ Kids of the Apocalypse – Noise GenesisMonthly volume traded: 1,283 SOL ($41,825)Primary sales (Oct.): Free mintSecondary sales: 1,283 SOLDrop date: Sept. 30
Kids of the Apocalypse (KOTA) is the first music project on the Solana (SOL) blockchain to make the monthly top 10. It’s an ambitious music project with a dystopian graphic-novel storyline which has been in development for several years, before Web3 was a popular concept. The 666 genesis NFTs grant holders access to the KOTA community and will act as a key for all future music drops.
The project was founded by Stefan Storm, a Swedish producer whose credits include Lady Gaga and Tiesto, and Derek Davies — the founder of Neon Gold Records. The NOISE Genesis project was free to mint but quickly generated more than 1,000 Sol in secondary trading volume.
View the collection on OpenSea.
10/ ChillrxMonthly volume traded: 21 ETH ($32,865)Primary sales (Oct.): N/ASecondary sales: 21 ETHDrop date: Sept. 16
Founded by Grammy-nominated producer Sidney Swift, Chillrx is a community record label where holders of the 10,000 NFTs get to participate in label decisions. The big goal, according to Swift, is to “win a mf-ing Grammy” as a community, via the label’s virtual artist called ChillPill. In October, Chillrx launched a new ‘staking’ feature. Holders can lock up their NFT (so that it cannot be sold). In exchange, they receive a loyalty token $CHILL which they can use to buy exclusive songs and eventually get access to other NFTs. The Chillrx floor price doubled after staking went live and more than a quarter of all NFTs are currently staked.
View the collection on OpenSea.
Methodology: The chart was compiled using data from primary music NFT sales across 19 different NFT platforms, independent releases and secondary volume data from OpenSea. Data was captured between October 1 – October 31, 2022. Conversion rates from crypto to US dollars were calculated on September 30.
One evening in July, panic spread in a small corner of the Web3 music space. Mysteriously, $6.1 million worth of cryptocurrency began moving out of blockchain music service Audius’ company treasury into an unknown wallet. Audius was being hacked.
The hacker discovered a bug that allowed them to take control of the Audius treasury — the crypto equivalent of a shared bank account — and transfer the entire funds to their own crypto address. The bug had lived in the code for two years.
This is shaping up to be the worst-ever year for crypto hacks, according to Chainalysis, with over 125 major hacks surpassing $3 billion in total, and on track to surpass the $3.2 billion in 2021.
Meanwhile, phishing scams continue to drain NFT wallets at an alarming rate. “Everything is unbelievably insecure,” says Sam Williams, founder of blockchain storage platform Arweave and a self-proclaimed “hacker,” though he uses the term as a broad description for coders. “We’re in the hackers’ Wild West of Web3 right now.”
Since the popularity of NFTs and cryptocurrencies like Bitcoin took off in early 2021, things have only gotten worse, creating a honeypot for hackers. “There was a lot of fluff brought in during the hype cycle last year,” Williams says, “and that typically lowers security standards for a period.” Teams scrambled to push products live to capitalize on the stream of new money paying too little attention to security.
For music companies or artists entering the space, the consequence of a hack could be enormous. Audius took a $6 million financial hit but it’s more than just money. Exploits can also damage the trust of music fans and undermine the entire promise of Web3. Warner Music Group considered this dilemma when launching its Stickmen Toys NFT collection earlier this year. “No matter how much time, how many resources, or how good of intentions go into a project, if there is a security breach, it can harm the project and its team’s reputation,” says Jillian Rothman, Warner’s vp of new business & ventures, business development.
The stakes of hacking are higher in Web3 than in today’s internet because customers are at direct risk of losing their money. If there’s a malicious link in a Discord server, dozens of community members could have their NFTs or cryptocurrency stolen from their wallet. If there’s a bug in the code, users could have their funds cryptographically locked with no recourse. The community backlash from these security incidents can be severe and costly that Web3 teams often resort to refunding users out of their own pocket. So, where are the biggest risks and what can music companies do to protect themselves and their artists?
Experts say the main vulnerabilities for the NFT space lie in smart contracts. These are programs written by developers on top of blockchains like Ethereum that hold funds and execute transactions — such as paying out royalties on secondary sales. “Smart contracts are just buggy and can be exploited,” says Nic Carter — partner at Castle Island Ventures, a VC firm with several Web3 music investments. “Things are so new in the crypto space that developers are still learning the best practices for safety.”
One NFT project, for example — Aku, by former MLB player Micah Johnson — got $34 million locked in a smart contract due a small bug in the code. The money was never recovered.
One way to immediately lower the risk is operating with transparency. “It should be damn open source,” says Williams, so that anyone can check and verify the code. “There’s no point trying to hide it. Better you find [bugs] early so you can fix them.” Blockchains like Ethereum are transparent by nature so hackers will find exploits if companies go live with buggy code. Better to test it in the open on so-called test-nets before deploying with real money and high stakes. While building publicly might take away an element of surprise in terms of marketing, it’s a small price to pay for added security. Additionally, smart contracts should be audited by external developers.
Next, there’s the risk of customers getting their wallets hacked. “[Crypto wallets are] probably the No. 1 risk,” for newcomers, says Carter. “A poor wallet setup or a failure of key management — that’s probably been responsible for the greatest loss of funds.” Companies can keep the community safe by highlighting the risks and educating music fans entering the space.
Carter recommends that anyone interacting with crypto use a hardware wallet — a USB device that disconnects from your computer and the internet. And they should limit the funds on a “hot wallet,” such as Metamask, which can be easily compromised through malicious links. “The NFT space is really aggressively targeted by phishing,” he cautions. “I think because it was mainstreamed so quickly… It meant a lot of people didn’t have as much experience in [wallet] management.” He also suggests using two-factor authentication on all crypto-related accounts and advises against clicking unknown links.
The team at Warner put this into practice using a “security” page on their projects’ Discord servers. Users have to read this page before entering. It explains the best practices and warns the community how to spot scams. “In a nascent space, bad actors prey on unsuspecting community members,” says Sebastian Simone, Warner’s vp of audience & strategy. “It will take longer for Web3 to go mainstream if people have negative experiences.”
Importantly, however, the failure of wallets and smart contracts does not imply a failure of the blockchain itself. “It’s extremely rare to have the blockchain itself be hacked,” says Carter. It is the code and applications on top of the blockchains that pose the biggest security threat.
Carter and Williams are both optimistic that these security issues will decline over the coming years through standardized contracts and simpler code, but the young industry is still learning the hard way. With every new exploit, developers are learning where the vulnerabilities are and adopting safer practices for the future.
As Carter puts it, “Safety rules are written in blood.”
Grammy-nominated DJ and producer Steve Aoki takes another step into the metaverse in a special Halloween fashion collaboration with Deadfellaz — an NFT project made up of 10,000 undead, zombie characters.
The collection features a limited-edition run of varsity jackets, skate decks, tees and hoodies designed by Deadfellaz co-founders Betty and Psyche. The centerpiece of the “Deadfellaz x Dim Mak” collection — a nod to Aoki’s record label and fashion brand — is an ultra rare varsity jacket, complete with a twin digital “wearable” that can be unlocked in the metaverse.
“NFTs and Web3 are the future,” said Aoki. “It has been such an adventure to create alongside pioneers such as Betty and Psych of the Deadfellaz Horde. Deadfellaz is an incredible project and a community that I am proud to also be a part of. I am honored to drop this collaboration for our Horde and share our passion with the world – the pieces are colorful, effervescent, and luxurious; I can’t wait to rock them!”
This is not the first time Aoki has partnered with the Deadfellaz community, known as the ‘Horde.’ He DJ’d at their first virtual Halloween event last year while Betty and Psych created a custom 1/1 zombie character for him called the ‘Aoki-fella.’
“Working with Steve has been so fun,” said Betty and Psych, co-founders of Deadfellaz. “He has embraced Web3 and helped shape the space as it is so far, which has been especially impactful given his incredible success given his incredible success in a multitude of spaces like music, fashion, art, tech, and more. This collaboration comes a year after Steve DJ’d an exclusive set for The Horde at our very first Deadfellaz metaverse event last Halloween, so it feels very special to us.”
The fashion collection will be fully revealed at this year’s Deadfellaz Halloween party, Deadzone LA, October 29. Taking place at Skylight ROW in LA’s Art District, the party will feature live performances, DJ sets and “multisensory experiences.”
Aoki has been an early-adopter of Web3 and a core part of the NFT community. He launched the Aokiverse in 2021 — a metaverse fan club powered by NFT access, which allows fans to unlock guest list passes for concerts, free NFTs and exclusive merch. Aoki is also a prolific NFT collector with a wallet full of Crypto Punks, Doodles and Deadfellaz.
Launched in August 2021, Deadfellaz is a collection of 10,000 unique NFTs based on zombie artwork by acclaimed digital artist Psych and co-founder Betty who has been a champion of diversity and inclusivity in the NFT space. Between them, they have created a global brand with more than $80 million in sales.