SONG NFTs

One song, one token, on NFT

There are two models for the tokenization of a song: the Unique NFT and the NFT Series

Unique NFT: 1 per 1, meaning there will only be one NFT per song.

NFT Series: 1 per X amount, meaning there is the possibility of creating a fixed number of NFTs per song. If the artist decides there will be 100 NFTs for a son, each buyer will have a that song tokenized as an NFT and each one will have a series number: “NFT 3 out of 100” or “NFT 22 out of 100”, to set an example.

The lower the series number, the greater the value of the NFT.

Associated royalties:

Assigning a percentage of the royalties from the record unit to the NFT, big or small, gives the NFT an extremely important additional value that boosts the commercial success of the token, since a favorable market reaction is expected when the fans receive an opportunity of ownership and involvement. This way, the owner of the NFT gets not only an asset that could increase its value over time, but also a financial income for a fixed period.

The artist can assign to the NFT either part of its income generated in the show business area, such as a concert or a tour, or a percentage of the record unit, editorial rights, author rights, etc.

The percentage, time and frequency of distribution of the royalties to the NFT holder is determined before tokenizing the asset, and said information is included in the description of the token, as well as the payment method.

BUSINESS MODEL

Distribution of the royalties collected by an NFT sale:

10%- Xave (operational costs)

90%- Artist (once the operation is completed, the artist receives its share through the payment method agreed in the contract, that could be either fiat or crypto).

NOTICE I: Each future sale will have a 10% fee that will be paid to the artist.

NOTICE II: The use of the Blockchain requires an additional cost called “GAS FEE” (on-chain transaction fee) which will be paid by the buyer of the NFT.

ACCELERATION PROGRAM

Xave’s acceleration program seeks growing the streams of the tokenized song in the most relevant digital platforms (Spotify, YouTube, etc.) through different On-Platform campaigns. This way, the opportunity of positioning the song on the market grows and it generates constant feedback that translate into revenues for both the artist and the owner of the NFT.

The acceleration program is available to both renown and emerging artists and be used for one NFT of the artist, for all of them or for none.

The funds for the promotion comes from 50% of the artist share for the sale of the NFT, this percentage can be modified to be lower or higher.

The On-Platform campaigns are designed and organized by XAVE MARKET but can be managed by third parties at petition from the artist, it could be an agency or the record company or producer that represents the artist.

The experiences or bonus are a sort of gift the fan gets access to when purchasing the NFT. The more unique, innovative and engaging they are, the more attractive the NFT will be to buyers. They could even become the reason the buyer purchases the NFT.

The following list shows examples of the experiences that can be linked to an NFT:

• Collectible card (digital art). The designed is subject to the graphic art of the record album, single or to the artist. Tarjeta coleccionable (arte digital). El diseño se encuentra sujeto al arte gráfico del álbum, single o, simplemente, al artista.
• VIP passes to virtual and real-life shows.
• Exclusive live streaming.
• Access to a unique augmented reality (AR) or virtual reality (VR) experience.
• 6. Official Merchandise exclusive for the NFT.

7.Remembrance plate or certificate (silver or golden according to the profits raised) framed and signed by the artist.

8. The opportunity to listen to the artist’s next song or album before its official release.

TOKENIZATION MODELS:

Model I (No associated rights):

1. Unique NFT or NFT Series.

2. Sale type: Fixed Price or Auction.

3. Royalties:

1o% for the platform (operative cost).

90% for the artist, with the option of investing a part on On-Platform campaigns

4. The buyer gets the NFT and the associated experiences (If the NFT includes any).

Model II (Includes associated rights):

1. Unique NFT or NFT Series.

2. Sale type: Fixed Price or Auction.

3. Royalties:

10% for the platform (operative cost).

90% for the artist, with the option of investing a part on On-Platform campaigns.

4. The artists yields X% of the royalties for “X” time to the NFT buyer.

5. The buyer gets the NFT, “X” % of the royalties during a fixed number of times through a fixed number of payments, and the associated experiences (If the NFT includes any).

STEPS TO FOLLOW

Before tokening a song, the next aspects will be evaluated and determined:

• Verifying if the song meets the basic requirement of intellectual rights. The person signing the contract must prove that he/she owns the rights to the song, that he/she is its legitimate owner.
• Determining whether the song will be assigned future royalties. If decided it will include royalties, determining the unit from which these royalties will be taken, the percentage to be assigned and their period of distribution.
• Designing the NFT card (it could be part of the single or album cover) and compiling metadata and information related to the phonogram.
• Defining the NFT model (unique or series). In case of choosing an NFT series, determining the number of tokens to be minted.
• Defining the initial price.
• Defining the commercialization model (fixed price or auction).
• Determining if the NFT will enter the Acceleration Program.
• Defining the experiences or bonus to be included, if any.
• Determining the date of presale and sale.
• Signing the contract.

NFTs CROWDFUNDING

NFTs Crowdfunding is a new tokenization model that allows the fans to get closer t their favorite artists by becoming a part of the funding required to organize a concert, a tour, an album, a videoclip, etc. through collective funding when purchasing an NFT.

This investment brings several benefits for the buyers, like a percentage of the earnings (ticketing, royalties, etc.), and the associated experiences or bonus.

Through this innovative business model, we seek to link the companies, producers, artist and fans by allowing them to share the risks of organizing and event or artistic production in order to make the music industry more transparent.

OTHER TOKENIZATIONS

Xave Market makes possible to tokenize a great variety of items or digital and physical assets, from the name of an artist or a song, to pictures, logos, personal quotes, videos or the artist’s personal image.

Besides the songs, the artists will be able to mint NFTs of different assets they consider important to their fans.

Examples:

• Album, Ep or singles (newly released or already launched songs).
• Album cover.
• Full videoclip, a segment of it, a frame or a series of frames.
• Most relevant drawings or pictures of the artist, individually or as a series.
• Manuscript (lyrics or music sheet).
• Digital art (portrait or any digital picture with a direct link to the artist).
• 2D or 3D avatar of the artist.