Music ·

Music NFTs vs. Traditional Streaming

Which Model Benefits Artists More? Discover Direct Royalties, Embrace Creative Freedom, and Unlock a New Era of Fan Engagement
IA

Iulian Anghelin

@IulianAngh

MD

Matteo Distefano

@matteo_distefano03

GM

Gabriela Mihai

@JourneyInSounds

In the rapidly shifting landscape of the music industry, artists are now at a crossroads. On one side lies the long-established realm of traditional streaming platforms, where platforms like Spotify, Apple Music, and Amazon Music reign, but with significant limitations for creators. On the other side is the emerging world of music NFTs, a model that promises to return power directly to the artists.

This blog takes an in-depth look at both models, explores real-world examples, and examines how innovative platforms like BitSong Studio are redefining the way artists connect with fans and earn a living.

A Look at Traditional Streaming

Traditional streaming services democratized music consumption by putting millions of songs at our fingertips. However, while these platforms have made it easier than ever for listeners to enjoy their favorite tunes, the underlying revenue model is far from ideal for many artists. Under the traditional system, subscription fees are pooled and distributed based on a pro-rata model. Imagine you have a favorite playlist that’s available 24/7, letting you discover new tunes anytime. For listeners, this is a dream come true, but for artists, the picture is less bright. That means even if a song is played millions of times, an artist might earn just a few thousandths of a dollar per play. It’s a bit like baking a huge cake and then slicing it so thin that, when it’s time to eat, there’s barely anything left for the baker. This model tends to reward the big names who already have massive audiences, leaving many emerging musicians struggling to cover their creative costs. This structure, widely reported in industry analyses, including insights from The Guardian, often favors established acts with large audiences while leaving emerging and independent musicians struggling.

Official Data from Spotify - The world’s most widely-used music streaming platform

What Is Loud & Clear by Spotify?

Loud & Clear is a portal designed for listeners and artists to provide transparency about payments from Spotify, the world’s most widely-used music streaming platform.

The portal is divided into several sections, each addressing a different aspect of Spotify’s economy. The first section presents 10 key points with various statistics. Beneath these, Spotify reveals earning brackets and the number of artists within each bracket. For this article, we’ll analyze these figures and include relevant insights from the 10 key points.

The earning brackets show annual payouts Spotify has distributed to a certain number of artists over the last five years. We’ll focus specifically on the data from 2022.

Earning Brackets (2022)

Percentages are calculated relative to the 3.4 million most active artists on the platform. These will be discussed further below.

  • $1K or more: 232,500 artists (6.84%) earned $1,000 or more.
  • $5K or more: 91,200 artists (2.68%) earned $5,000 or more.
  • $10K or more: 57,000 artists (1.68%) earned $10,000 or more.
  • $50K or more: 17,800 artists (0.52%) earned $50,000 or more.
  • $100K or more: 10,100 artists (0.30%) earned $100,000 or more.
  • $500K or more: 2,230 artists (0.07%) earned $500,000 or more.
  • $1M or more: 1,060 artists (0.03%) earned $1 million or more.
  • $2M or more: 470 artists (0.014%) earned $2 million or more.
  • $5M or more: 130 artists (0.0038%) earned $5 million or more.
  • $10M or more: 40 artists (0.0012%) earned $10 million or more.

Spotify also notes (in their third key point) that some artists may generate up to four times their Spotify earnings through other revenue streams like physical album sales, other royalties, concerts, and merchandise.

At first glance, it might seem that many artists are living the high life. However, a closer look at these numbers reveals a more complex picture.

Breaking Down the Numbers

Spotify has over 9 million registered artists, of which 3.4 million have released 10 or more songs. The remaining 5.6 million have released fewer than 10 songs, suggesting they may be hobbyists or newcomers.

For this analysis, we focus on the 3.4 million active artists, as they are more likely to be affected by the statistics we’re examining.

Who Earns Enough to Live Off Spotify?

Bracket 0 (Under $1,000)

  • Out of 3.4 million, 93.16% (3,167,500 artists) earn less than $1,000 annually, equivalent to $80 or less per month. Most of these artists likely can’t even cover production costs.

Bracket 1 ($1,000–$5,000)

  • 4.16% (141,300 artists) earn between $1,000 and $5,000 annually, or $83–$416 per month.

Bracket 2 ($5,000–$10,000)

  • 1% (34,200 artists) earn between $5,000 and $10,000, or $417–$833 per month.

Bracket 3 ($10,000–$50,000)

  • 1.15% (39,200 artists) earn between $10,000 and $50,000, or $833–$4,167 per month.

Bracket 4 ($50,000–$100,000)

  • 0.23% (7,700 artists) earn between $50,000 and $100,000, or $4,167–$8,333 per month.

Bracket 5 ($100,000–$500,000)

  • 0.23% (7,870 artists) earn between $100,000 and $500,000, or $8,333–$41,667 per month.

Brackets 6–10 (Over $500,000)

  • 0.07% (2,230 artists) earn more than $500,000 annually, representing those who have truly “made it” in the industry.

The Advent of Music NFTs: A Decentralized Revolution

A radical shift toward decentralization and direct artist empowerment are music NFTs.:brWith NFTs (Non-fungible token), every track, album, or digital collectible becomes a unique, verifiable asset on the blockchain. This innovation transforms the artist’s role from mere content provider to entrepreneur and rights-holder.This is the promise of music NFTs.:brUnlike traditional streaming, where revenues are minuscule and heavily intermediated, music NFTs empower artists to monetize their work directly, with every transaction recorded transparently on a decentralized ledger.

Learn more about Music NFTs

Real-world examples underscore the transformative potential of this model. Bands like Kings of Leon and electronic producers such as 3LAU have ventured into NFT releases, proving that this approach can generate substantial revenue while forging stronger bonds between creators and their audiences.

For instance, renowned DJ [Steve Aoki](<<<<<https://steveaoki.com/&#x29&#x3E&#x3E&#x3E&#x3E&#x3E;;;;;; has emerged as a leading figure in the NFT music space. In one notable instance, Aoki’s “hairy” NFT sold on Nifty Gateway for $888,888.88—a figure that, as reported by Fortune and Coinspeaker, surpassed the cumulative advances he received over a decade in the traditional music industry. His successful NFT ventures have generated millions in revenue, and his collection is available for viewing on OpenSea.

Similarly, hip-hop icon [Snoop Dogg](<<<<<https://snoopdogg.com/&#x29&#x3E&#x3E&#x3E&#x3E&#x3E;;;;;; has harnessed the power of NFTs to create an entirely new revenue stream. His NFT project “Stash Box”—launched in conjunction with an album release—saw thousands of limited-edition tokens sold at approximately $5,000 each, accumulating over $44 million in revenue in just a matter of days, as detailed by NFTandGameFi. Beyond generating significant income, Snoop Dogg’s initiatives extend to offering interactive digital experiences and exclusive content that deepen fan engagement, all while ensuring that automated royalties reward him with each resale.

Together, these examples by Steve Aoki and Snoop Dogg illustrate how NFTs are revolutionizing the music industry—empowering artists with immediate, substantial earnings and a direct connection with their audiences, while retaining complete creative control.

BitSong Studio - Music NFT Marketplace: Pioneering the New Era

At the heart of the blockchain music revolution is BitSong Studio. Designed specifically for the modern artist, BitSong Studio offers a user-friendly platform that streamlines the process of minting, listing, and selling music NFTs. By leveraging blockchain technology, BitSong Studio removes the need for traditional intermediaries, ensuring that every sale or resale directly contributes to the artist's income.

Learn more about Music NFT Marketplaces.

What makes BitSong Studio truly innovative is its commitment to transparency and direct artist empowerment. Through smart contracts, every transaction, from initial NFT drops to secondary market sales, is recorded on a decentralized ledger, and royalty payments are distributed in real time. This means artists can finally see exactly how much they're earning, without the opaque practices common in traditional streaming.

For those eager to dive deeper into this revolutionary approach, BitSong Studio offers comprehensive guides:

Comparing the Two Models

The divergence between traditional streaming and the NFT model is more than just a financial debate, it’s a reimagining of the music ecosystem. Traditional streaming offers massive exposure but at the cost of diluted earnings and diminished control. In contrast, the NFT model is built on principles of direct revenue distribution, transparent transactions, and artist autonomy.

Key Takeaways from the Spotify Data

  1. The Majority Struggle to Earn Enough:
    A vast majority of Spotify’s active artists make less than $1,000 annually from streaming. This suggests that digital streaming alone is not a viable income source for most.
  2. Significant Earnings Are Rare:
    Artists in Bracket 3 ($10,000+) can invest in their careers, but only from Bracket 4 ($50,000+) do artists typically begin to live comfortably from their music. However, fewer than 0.52% of active artists reach this level.
  3. Misleading Perceptions:
    Public perception of the music industry’s profitability is skewed by the success of a small elite (e.g., Bracket 6–10 artists). These outliers, representing just 0.07% of active artists, create an illusion of widespread wealth in the music business.

Traditional Streaming limits artists with:

  • Revenue Dilution: Earnings are shared across multiple intermediaries.
  • Limited Creative Control: Contracts often force artists to surrender rights.
  • Passive Listener Engagement: Fans remain consumers rather than active contributors.

Music NFTs, on the other hand, promise:

  • Direct Royalties: Every transaction, recorded via smart contracts, results in immediate compensation.
  • Full Ownership: Artists retain complete control over their creative works.
  • Enhanced Fan Connection: NFTs create a dynamic space for fans to invest in and support the artists they love.

For many, the choice isn’t about completely abandoning traditional streaming. Instead, it’s about leveraging both models, using the expansive reach of streaming platforms while embracing NFTs to secure a sustainable, artist-centric revenue stream.

Looking Ahead: The Future of Music

The battle between traditional streaming and Music NFTs represents a pivotal moment in the evolution of the music industry. As blockchain technology continues to mature, models like web3 music are set to transform not only how music is distributed and monetized but also how artists interact with their fans. Emerging studies and artist testimonials suggest that this new paradigm could lead to greater financial independence and creative freedom for musicians worldwide.

The future is already here, and platforms like Music NFT Marketplace are leading the charge toward a fairer, more transparent industry. Whether you’re an artist striving to reclaim control over your creative output or a fan eager to support your favorite musicians more directly, the decentralized revolution in music offers endless possibilities.

Final Thoughts

These findings illustrate how narrow the window is for artists to achieve significant earnings from streaming. While additional revenue sources (concerts, merchandise, etc.) may supplement income, streaming often constitutes a critical portion of an artist’s earnings. The data suggests that most artists must pursue other activities to sustain themselves, potentially detracting from their focus on music.

Challenges Impacting Artists’ Earnings:

  • Production and recording costs.
  • Distribution fees and label contracts (often requiring royalty shares).
  • Taxation on royalties.

The music industry is highly profitable—but primarily for a select few. For the vast majority, streaming revenue is far from sufficient.

Disclaimer

While we used Spotify’s own data for this analysis, the figures are only estimates and may not fully reflect the complexities of artist earnings on the platform.

References:

BitSong and Music NFTs

Streaming Platforms and Industry Analysis

Best 5 Music NFT Marketplaces

Discover the Top Platforms to Buy, Sell, and Collect Music NFTs

BitSong Chain Upgrade v0.21

BitSong's v0.21 Upgrade: A New Era of Innovation and Reliability, Enhancing Performance, Security, and Cross-Chain Capabilities