A lot of people using Choon, are new to cryptocurrencies and blockchain technology. So the whole concept of a NOTES token for the music industry, it’s value and it’s utility, will be hard to understand. But I will do my best to explain it in this article, and answer to questions I frequently see get asked.
I'm sorry for the possibly clickbait-like title, but if you clicked it, you might think someone knows their price. Which they don't. There will be no price prediction in this post, and the reason for that should make sense after reading
Will 10 000 Notes always be = 1 Ethereum?
No. This was only the price during the token sale. Once they get unlocked after Sept 1.st, their value can in theory be anything. It will be higher if there are more people wanting to buy it, than there are people who wants to sell it. And it will go down if a lot of people wants to sell at once, without it being a sufficient desire to buy them from the other side.
How much will a Note be worth?
Nobody knows. If anyone tell you they know, they are lying. “It’s crypto” as I like to say, meaning anything can happen. A lot of people might have some ideas, some predictions, or other arguments for why the price will be x. And it might make sense, but there are still nobody who actually knows.
What will determine the value of a Note?
The value will be determined in a few different ways, depending on Choon’s progress and features.
In the early days, the notes value will be determined by peoples overall faith in what Choon will become in the future. Typically crypto investors are the ones determining the price, as the price will go up and down depending on how many people wants to buy vs how many people wants to sell. Similar to how the stock market works.
Aside from this, there are quite a few other kinds of people who will benefit from getting their hands on notes early:
Labels
Since Choon will release their own take on music advertising, where listeners are incentivized to listen to a song and get paid for the first stream only. So labels might be interested in getting Notes “while they’re cheap”, as it will result in very cheap advertising for their artists in the long run. And based on the features described below, there should also be a lot more arguments for labels to get Notes now, even if Choon is not aimed at labels at all.
Listeners
As a listener, getting your hands on Notes early might mean cheap streaming packages, downloads, concert tickets, merchandise, tipping, and other benefits as they get implemented.
Artists
For the same reasons above, as well as artists will eventually be rewarded for holding on to their tokens (“staking"). And at a later time, there is a possibility that you will need a minimum supply of notes to be able to upload music.
"Whales"
We see it over and over in cryptocurrencies, so it might happen to Choon as well. A “whale” is a wealthy individual or institution. Since the market caps (total market) are smaller in crypto, it is a lot easier to manipulate the market if you have a lot of money. For instance acquiring a lot of tokens over time, and selling it all at once to create some hysteria and have more people sell as the price is dropping. Only to buy back it all, and then some, for cheap.
If the price dramatically drops overnight for no apparent reason, this is often a likely cause. It can be hard to identify some times, but it certainly happens to smaller tokens. It can also go both ways. Whales stocking up on a token, releasing some news, and rapidly buying more to inflate the price, and then sell after people take the bait and buy in.
-My advice on this?
If the price is rapidly dropping, try to find out the cause before selling, as it could be whales wanting your tokens for cheap. Following the flow is rarely the best thing to do in crypto. “Buy the rumor, sell the news” is a common saying, meaning that often as soon as you hear something and the price is going up, it might be too late to get in and turn a profit. Someone has probably bought up a lot of a token before starting to spread rumors or news, with a plan on selling as more people find out and buy in.
I wanted to cover this point, as it might be a new concept to a lot of artists. I’m hoping it will avoid some hysteria and confusion if it happens with Choon in the future. It might, and it might not. But if it does, you now know why.
These are potential uses that will happen while we’re still in the early days. Currently, the notes' only asset, is people’s faith in the company in the future.
But there will be more and more features coming to the platform, allowing for different ways of spending the tokens.
Streaming packages
What will likely be the bread and butter in terms of Choon’s earnings in the earlier days. When a new listener starts paying for a streaming package, Choon will buy back notes from an exchange, effectively increasing the price of the token, and making sure there is always a buy pressure on the token at the exchanges. This is crucial for the eco system to be able to support the artists in the long run, with real money.
Advertising
Incentivized plays, as mentioned above. I don’t know exactly how it will work, but the revenue from this will be returned to the streaming as mining pool and given out to artists. (After Choon has taken their platform cut)
Downloads
Will play a part, but it’s becoming more and more niche, and is far from as big as streaming. The biggest market for downloads are dj’s. And as a lot of artists are also dj’s, it’s likely that downloads will mostly be artists with existing notes, buying each other’s tracks. At least in the early days, until more people are using the platform.
Concert tickets
This is a big market. And in the legacy system, there are quite atrocious fees. Both for buying a ticket from a ticketing company, as well as often for transferring them. When concert tickets are purchasable by using Notes, the demand should go up quite a bit, and continue increasing as more and more people are buying their tickets using notes. And the artists are likely to get a bigger share of that pie as well.
It is also nice to keep in mind that if Choon nails down concert tickets, making it more convenient and cheaper than the alternatives, a lot of event organizers are likely to get on board.This will further increase the demand of the token.
Merchandise
Artists will be able to sell their merchandise through the platform, further increasing the demand of the tokens. And, if this is laid out in a easy to use manner, and convenient for artists, the up-front investment in both time and costs, will drop dramatically.
Artists are able to invest in building their following on Choon, and then monetizing their fanbase by providing great merchandise. I do not know how big the market for merch currently is, but it is likely to increase if it’s easier for artists to start selling it.
Tipping
Hard to predict how much this will increase the demand, but tipping is a great concept. As an artist, you will be able to tip your fans. If someone leaves an amazing comment, it can make your day. Tipping will be a great way of showing gratitude, as well as it will also deepen the relationship you are able to build with your listeners.
And from a listeners point of view, tipping your favorite artists is a good way to get on their radar, as well as rewarding your favorite ones.
Collectibles
I am not really that familiar with this, but it appears to be a growing trend. I think of it similar to cosmetic items purchased in free online games like Dota 2, Fortnite, and others. Rare ones might increase in value, and quite a few people are collecting them as well. (Similar to stamp or coin collection for the elders here)
Artist crowdfunding
This allows users to crowdfund an artist’s tour, releases, merchandise and other things. Similar to how crowdfunding works in existing platforms like Indiegogo and Kickstarter, this will be the same, but for music related products and services. Typically, supporters gets the product or service at a reduced rate, for helping out with funding the development early.
Limited edition releases and collectibles aftermarket
A marketplace for people to buy and sell collectibles and limited edition releases, and more. Doing limited edition releases is something I don’t think I have ever seen before, but I am curious to see how it will turn out. Having a market place like this will increase the demand of notes depending on how much or little people are buying.
Investing in artists
Artists and users will be able to “invest” in another artist to fund an upcoming release. Investors will then receive a percentage of the royalties of the tracks they invested in. "This is subject to legal & regulatory approval and may not launch in all worldwide Choon markets.” according to the roadmap, but it is a very interesting concept still. It basically makes every track similar to a stock-based company.
All of these features are what will drive the actual demand for tokens up in the long run. The price it gets traded for will still fluctuate from speculation, but with these features in place, all of them will contribute to people always needing NOTES for music-related purchases.
However, similar to stock prices, actual demand might not always dictate the trading price of the tokens. Especially not in the early days when the trading volumes are likely to be lower than in the future. Bad news about Choon might drop the price overnight, and good news might give it a big bump. This will even out as the real demand increases, and the volumes go up.
So what will the tokens be worth then??
42
Or a cat in a banana. Or -Z.
Just read the whole article and make up your own mind. I do not have a crystal ball, as does nobody else.
If there are questions and comments with things you want me to adress, things that are wrong, or you would like to say something else, let me know! And I might update the article as well =)
My introduction to Choon: https://steemit.com/streaming/@cryptoprebz/why-i-believe-so-strongly-in-choon-and-why-it-matters
My price predictions with numbers: https://steemit.com/streaming/@cryptoprebz/my-take-on-the-price-predictions-actual-demand-for-notes-based-on-the-existing-music-market (Most likely wildly inaccurate, but helps seeing the big picture)
P.S. If you liked this post, I will greatly appreciate an upvote, or that you support me by streaming some of my music on Choon. You can find my profile here: Kryptokind on Choon ( #melodictechno + #minimaltechno, #progressivehouse + #deephouse, and more. Some with inspirations from #italo and psy)
I also have set the playlist split to 50% for all my tracks, allowing you to get 50% of the royalties from any of my songs streamed through your playlist