Harmonising Blockchain: Revolutionising Music Royalties Management with Cryptocurrency
By Aaron Scott, RadioPRO Chairperson
The global music market grew by 18.5% in 2021, with the fastest growth coming from Africa, Asia and Latin America. The United States, still the largest single market, grew by 9.1% across physical and digital sales. By 2022, streaming accounted for 84% of US music revenue, and in the UK some 39 million people were listening to streamed music every month.
Those numbers describe an industry in good health. They do not describe an industry in which the people making the music are doing well. Artists and rights holders sit at the centre of all this activity and receive a strikingly small share of what it generates – roughly 12% globally, by most estimates. The question this article looks at is whether cryptocurrency and blockchain can change that, and what RadioPRO intends to do about it.
Where the money goes now
Digital distribution transformed how music reaches listeners, and royalty systems have not kept up. The infrastructure was designed for an era of physical sales and scheduled broadcast, and it shows.
Royalty administration is fragmented. Contracts pass through banks of intermediaries – performing rights organisations, publishers, distributors – each operating with limited transparency and its own reporting cycle. Money moves slowly through that chain, and discrepancies accumulate along the way. The people at the end of it see a fraction of the income their work produced, often months after it was earned, with little means of checking the calculation.
For artists, this is not an abstract complaint. Outdated distribution mechanisms make it genuinely difficult to claim revenue that is already owed, and the administrative burden falls hardest on those least able to absorb it.
| Aspect | Pre-Digital Transformation | Post-Digital Transformation |
|---|---|---|
| Revenue source | Physical & broadcast | Streaming & downloads |
| Artists’ share | Variable; often more generous | Approx. 12% globally |
| Distribution speed | Slower, periodic payments | Increased demand for real-time |
| Transparency level | Opaque | Needs improvement |
What blockchain actually changes
Blockchain addresses a specific weakness in the existing system: there is no single record of who owns what and what was paid. A distributed ledger provides one. Transactions recorded on it cannot be altered afterwards, which means artists and other stakeholders can follow royalty distributions with a precision the current arrangement does not offer.
Smart contracts take this further. A smart contract is a piece of code that executes automatically when a defined condition is met – a stream, a download, a broadcast. Payment follows the event rather than the quarterly reporting cycle, and it follows it without anyone processing it by hand.
Fewer intermediaries
The more significant consequence is structural. If artists can transact directly with their audience, and fans can support artists without a label or agency in between, the distribution of power in the industry shifts. That is a large claim, and it is worth being precise about it: the technology makes disintermediation possible, it does not make it inevitable.
| Traditional royalty distribution | Blockchain royalty distribution |
|---|---|
| Intermediary-dependent transactions | Peer-to-peer, intermediary-free transactions |
| Delayed and opaque royalty payments | Immediate and transparent payments |
| Complex rights management | Simplified and automated rights management |
| Variable fee structures | Lower or no transaction fees |
| Manual claims and distribution | Smart contract-enabled direct distributions |
What exists already
This is not purely theoretical. Platforms such as Royal, Musicoin and BitSong have each attempted direct monetisation without intermediaries, with varying degrees of success and some real limitations. They are worth studying for both reasons.
RadioPRO’s own forthcoming investment in a blockchain platform is intended as a practical demonstration rather than an experiment. The underlying technology has been in limited use for years; the work now is scaling it so that payment moves from stream to artist’s wallet in a usable timeframe.
| Aspect | Traditional royalty scheme | Blockchain royalty scheme |
|---|---|---|
| Payment speed | Delayed | Instant |
| Transparency | Low | High |
| Artist autonomy | Limited | High |
| Intermediaries | Multiple | None / minimal |
| Costs | High due to intermediaries | Reduced significantly |
Cryptocurrency and the payout process
Paying in cryptocurrency removes several steps that exist only because money has to cross borders and institutions. Earnings arrive in a digital wallet rather than passing through correspondent banks, and the transfer is recorded publicly.
| Feature | Traditional royalties | Cryptocurrency royalties |
|---|---|---|
| Payment speed | Delays common; processed manually | Instant; facilitated by smart contracts |
| Transparency | Opaque; difficult to track | Transparent; visible on the blockchain |
| Intermediaries | Multiple, including PROs and publishers | Minimal; direct to the artist’s wallet |
| Automation | Manual calculations and distributions | Fully automated via smart contracts |
Tokenisation
Tokenisation means representing a right, or a share in a song’s earnings, as a digital asset on a ledger. The practical effect is that ownership and entitlement become visible and checkable, rather than buried in contracts held by other parties.
It also compresses the payment cycle. When a track is streamed, the artist can be paid almost immediately through a secure peer-to-peer transfer instead of waiting for an accounting period to close.
| Aspect | Traditional royalty management | Tokenised royalty management |
|---|---|---|
| Transparency | Opaque, with multiple intermediaries | Highly transparent, direct overview of rights and earnings |
| Speed of payment | Delayed by intricate administrative processes | Immediate, following a secure peer-to-peer transfer |
| Control over rights | Limited due to complex distribution chains | Full digital ledger documentation held by the artist |
| Scope for innovation | Constrained by existing industry structures | Expanded, with room for artists to pioneer new models |
Real-time payment through smart contracts
Smart contracts are written with defined rules that execute when a specified trigger occurs, such as a song being streamed. Instead of waiting for periodic disbursements that may contain errors or arrive late, payment happens at the point of use.
Because every transaction is recorded on a distributed ledger, the result is a permanent and publicly verifiable record. That is a direct answer to the opacity that has characterised royalty distribution for decades. In summary, the model offers:
- payment at the point the music is consumed;
- transparent record-keeping;
- fewer intermediaries and lower associated costs;
- greater trust between artists, listeners and the rest of the industry.
NFTs
Non-fungible tokens gave artists a way to mint work as authenticated, unique digital assets, and to receive a percentage of sales each time that asset is resold – something the traditional market never offered. Where the royalty agreement is encoded into the smart contract itself, payment on secondary sales follows automatically.
| Traditional royalty system | NFT-based royalty system |
|---|---|
| Intermediary dependent | Direct artist-fan transactions |
| Opaque royalty calculations | Transparent and automated royalty distribution |
| Delayed payments to artists | Real-time royalty payments |
| No benefit from secondary sales | Royalties from resales paid to artists |
What artists gain
Most of the industry’s long-standing frustrations – opaque accounting, slow decisions on royalty claims, and a general lack of control – stem from the same source: the artist is the last party in a chain they cannot see. Three changes follow from fixing that:
- Direct payment. Earnings arrive without unnecessary delay or detour.
- Fewer intermediaries. The ledger acts as both record and enforcement mechanism, reducing the need for third parties.
- Greater control. Decisions about how and where music is distributed return to the person who made it.
Fan engagement
Decentralised platforms also change the relationship between artists and audiences, by allowing fans to invest directly in the work they care about rather than simply consuming it.
| Platform type | Role in fan engagement | Benefits for fans |
|---|---|---|
| Music tokens | Fans buy tokens tied to artists or songs, giving them a stake in future revenue | Financial returns, exclusive content, a vote in artist decisions |
| NFT marketplaces | Collectors own, sell or trade unique digital merchandise | Verifiable ownership, potential increase in value, closer connection with artists |
| Fan funding platforms | Fans fund artist projects directly | Early access to music, credits in album notes, direct interaction with artists |
Piracy
Content piracy continues to take revenue from artists and producers. An immutable ledger helps, because every transaction and transfer of ownership is logged permanently and is publicly verifiable. Proving ownership – often a slow and contested process – becomes a matter of consulting the record.
| Content distribution aspect | Traditional systems | Immutable blockchain ledgers |
|---|---|---|
| Record keeping | Often manual, prone to errors | Digital, accurate and tamper-proof |
| Transparency | Limited visibility for stakeholders | Full transparency in transactions |
| Ownership tracking | Complex and occasionally ambiguous | Straightforward and indisputable |
| Royalty distribution | Delayed and often disputed | Instant and direct to rights holders |
| Piracy deterrence | Limited preventative measures | Improved prevention through traceability |
Legal and regulatory questions
None of this operates outside the law, and the decentralised nature of blockchain creates genuine enforcement difficulties. Any system built on it has to work within existing copyright frameworks rather than around them.
Music crosses borders, so international regulation matters as much as national law. Navigating it requires a working knowledge of the treaties, agreements and procedures that govern cross-border royalty flows – and an approach in which every stakeholder has access to clear information about how the system treats them.
| Consideration | Copyright compliance | International regulation |
|---|---|---|
| Blockchain adaptability | Must align with national copyright laws | Compliance with international treaties and conventions |
| Transparency | Traceable record of ownership and transactions | Auditable royalty distribution paths |
| Digital rights management | Encryption and access control mechanisms | Uniform standards despite varying regional laws |
| User education | Informing about copyright and proper use | Understanding of different royalty systems |
The two systems side by side
Traditional royalty systems are slowed by layers of intermediation and by accounting practices that are difficult to inspect. Blockchain-based systems automate the transaction and remove much of the administrative overhead, which is where the efficiency gain comes from.
For an artist, the difference is concrete. Under the old arrangement, payment could take months to arrive and a meaningful portion was absorbed by administrative fees along the way. Real-time settlement pays at the point of use, and leaves an auditable trail of exactly what was paid and why.
Outlook
Blockchain is not a passing enthusiasm, and it is not a complete answer either. What it offers is a trustworthy and inspectable model for recording who owns what and who has been paid – which is precisely the thing the current system does worst.
The structures that have governed royalty distribution for decades are being reconsidered, and the direction of travel is towards something more direct and considerably faster. For artists that means more than an efficiency gain. It means a greater degree of control over their own work and their own income, which is the point of all of it.