NFT + DeFi：A New Music Gameplay Created by Opulous

2022-03-11, 03:32

Summary

1. Opulous introduces decentralized finance to the music industry.
2. Opulous integrates NFT issuance (Launchpad), NFT trading (Exchange), and lending (DeFi).
3. Opulous tokens offer a share of music rights to buyers who can also benefit from the monthly royalty income generated by these NFTs.
4. After completing the musical works, musicians mint and sell music NFTs that represent the copyright of the works and can generate income in the future in order to obtain sufficient financing.

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Opulous is an NFT music platform launched by Ditto Music, one of the largest record companies in the world. As introduced on the Opulous official website, the introduction of decentralized finance to the music industry is the project’s biggest feature.

Musicians on Opulous can convert the copyright of their musical works into NFTs and sell them on the platform. Users can obtain the copyright of the work by purchasing these music NFTs. Besides, the royalty income of the work will also be distributed to the holders of the NFT. Thanks to the extensive music publishing and distribution business of Ditto Music as well as its large base of musicians, music publishing and trading on the Opulous platform is also very active.

This, to a certain extent, has revolutionized the way artists obtain the funds they need, while providing them with a copyright-backed NFT distribution platform. The current Opulous integrates NFT issuance (Launchpad), NFT trading (Exchange), and lending (DeFi).

Opulous states on its official website that Opulous is the first platform to launch NFTs for music copyrights, on which both NFTs issuance and NFTs trading are available. NFTs on Opulous are different from those on other music platforms. Opulous tokens offer buyers a share of music rights. According to its operation logic, musicians convert their works to NFTs with music copyrights and then issue and sell them on the platform to obtain huge profits. When music is played on major platforms such as Spotify and Apple Music, it will generate the corresponding royalty income. Also, NFT holders can get profits from the monthly royalties income generated by these NFTs. That’s because they can earn royalties constantly after they have purchased the NFTs with the copyright bundle. In the process, musicians can even raise money by selling music rights, and fans can support their idols and build closer ties with them by buying these NFTs with music rights.

Opulous has also introduced risk-free DeFi loans based on real-world music assets and future royalties. Musicians who have received a stable royalty income can apply for a loan from the platform by staking their music copyright off-chain. The loan amount can be as high as the royalty income they earn in 12 months, and the interest rate is as low as 4%. On the other hand, NFT holders can also stake their purchased copyrighted NFTs to lend on the platform. Additionally, musicians who deposit their funds with the Opulous DeFi platform are often able to receive higher interest rates than traditional banks.

Compared to ordinary DeFi platforms, well-developed music works can bring more stable cash flow. Therefore, NFTs with corresponding music works copyrights are reliable collateral for DeFi financing.

Presently, a number of institutions including R3 and Algorand have invested in Opulous. The total financing amount exceeded $65 billion, of which $1 million was raised through crowdfunding. It is stated in the project’s white paper that the DeFi component of the Opulous platform will be officially launched in the first quarter of 2022, and the NFT trading component will be launched in the second quarter.

Tokenomics

The DeFi component of Opulous is built on the Algorand blockchain. The token $OPUL, with 500 million tokens in total, is native to Opulous. It is also used to pay on the Opulous platform. Users can obtain handling fees by using $OPUL to trade NFTs on the platform. Moreover, OPUL is also a payment method and is used to gain DeFi revenue on the platform.

While working with musicians, Ditto found the dilemma that many musicians are in. First, piracy is rampant in the Internet age, and music is often regarded as a "free commodity" and therefore is valueless; second, record companies and the music industry giants still hold the monopoly when it comes to the artist’s bundles of rights This makes it hard for fans to directly support the artists. Both factors push musicians to a dilemma of insufficient sustainable funds but their love for the art motivates them to continuously create music.

NFTs establish property rights in the digital world, while DeFi removes the middleman from the value chain. For hard-pressed musicians, Opulous certainly provides a source of financing outside traditional banks to help them better develop their careers. Opulous creates a closed loop in the music value chain for singers and composers alike. This is one of the three main functions of the platform.

After completing the musical works, musicians mint and sell music NFTs that represent the copyright of the works and can generate income in the future. This contributes to obtaining sufficient financing. Fans and investors support the artists in creating works by purchasing and holding music NFTs, through which they are able to obtain future royalties income. Moreover, NFT holders can obtain revenue by staking tokens and NFT assets, while the project party supports more musicians through the revenue.

Image: Opulous's current cooperative artists

At present, Ditto, the parent company of Opulous, has partnered with over 500,000 independent musicians and record companies worldwide and will release music NFTs with a number of famous musicians. In April 2021, British rapper Big Zuu and American musician Taylor Bennett released 50% and 75% share of the album through Opulous, and minted 50 and 75 NFTs respectively, each representing a 1% copyright share. Opulous also collaborated with Lil Pump and Soulja Boy on November 6th to turn their song "Mona Lisa'' into NFT for sale and gained $500,000 within 2 hours.

Author: Edward H., Gate.io Researcher; Translator: Cedar W.
*This article represents only the views of the researcher and does not constitute any investment suggestions.
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