GALA MUSIC — The Exploration Path of a Decentralized Music Platform

Written by: @EdisonHuu

Mentor: @CryptoScott_ETH

1. Introduction

Languages around the world are different, but music can resonate with all listeners through its melodies. Music is a common language of humanity and a shared treasure. After analyzing the music sector in the previous article on Gryhsis, this report will analyze Gala Music.

2. Project Introduction

2.1 Overview

Gala Music is a decentralized music platform built using blockchain technology, allowing music artists to enhance their control over music and increase transparency in the industry chain, while fans can connect more closely with music artists.

Gala Music is an important part of the Gala ecosystem, forming the cornerstone of the Gala ecosystem along with Gala Games and Gala Movies.

2.2 Team Information

The core team of Gala has been introduced in our previous report on Gala.

The CEO of Gala Music is Leila Steinberg, who has worked as a marketer at Atlantic Records, Sony, Def Jam, Tommy Boy, Interscope, and Relativity. Her other identity may be more well-known -- she was the artist mentor and first manager of the legendary American rapper 2PAC. 2PAC is not only a legend in the Hip-Hop circle but also widely regarded as one of the most influential and successful rappers of all time, both in the United States and globally.

(Legendary rapper Tupac)

2.3 Financing Situation

Like Gala Games, Gala Music has not disclosed its financing. As mentioned in our Gala Games report, perhaps due to pressure from U.S. regulations, Gala Music has also used node sales as a form of indirect financing.

2.4 Detailed Explanation of Gala Music's Operation Logic

There are four basic roles on the Gala Music platform:

1. Artists

Artists are the core of the Gala Music ecosystem. Currently, Gala Music has listed 93 artists on its official website, including the rapper Snoop Dogg, who has deep cooperation with Gala Music. They create and release music NFT works on the platform, earning revenue through selling NFTs and selling merchandise in the All Access store.

2. NFT Owners

By purchasing a song NFT, one becomes the owner of that song, also known as an NFT holder. Song owners need to host the NFT on a node to earn $MUSIC.

3. Node Operators

By purchasing a node on the Gala Music platform, one can become a node operator. The current node price is 11,704 $MUSIC, which is approximately $2,000 based on the current market price of $MUSIC. Nodes have a requirement of 20 hours of normal operating time and can currently host 10 tracks; after that, $MUSIC can be used to increase the number of hosted tracks.

4. Fans

Fans can listen to their favorite artists' songs for free and earn $MUSIC by listening to music. They can purchase artist merchandise, albums, concert tickets, etc., making them the main consumer group in the Gala Music ecosystem.

3. $MUSIC Token

3.1 Token Utility

$MUSIC is the core token of the Gala Music ecosystem, with extremely strong empowerment provided by the official team. $MUSIC is primarily used to purchase music NFTs, buy artist-related merchandise in the All Access store, and for node purchases. Additionally, it can be used to upgrade node-hosted tracks and incentivize the ecosystem.

The maximum supply of $MUSIC is 1 billion, with an initial circulation of 150 million. The initial 75 million $MUSIC tokens come from test tokens, and the same amount of 75 million $MUSIC tokens has also been minted by the official team for ecosystem operators, used for ecosystem partners and platform participation activities, including platform development, its functions, and related products.

The $MUSIC token will follow a dynamic supply controlled by a mathematical formula similar to a bonding curve, where the creation (minting) of new music is analogized to ecosystem parameters, and this formula relies on input from ecosystem activity parameters.

Its design aims to ensure that the supply of $MUSIC is proportional to platform growth and the increase in token utility, alleviating potential oversupply and undersupply issues in fixed supply plans. By tracking the number of music pieces produced on the blockchain, it ensures transparent and real measurement of demand, growth, and expansion.

The curve below calculates the amount of Mint allowances generated by the minting of new tracks. This chart shows the $MUSIC allowances generated by the minting of 100 music tracks, ensuring that the token supply only increases when token utility increases.

$MUSIC is burned through token utilities (such as purchases in the All Access store) and other ecosystem-related functions (like STGE tips), reducing the circulating supply of $MUSIC. The Mint allowances obtained from ecosystem activities will increase, and this reciprocal minting and burning mechanism ensures the sustainable operation of the ecosystem.

The Mint allowance pool is the initial circulation of $MUSIC, with 0.15% of the 150 million Mint allowance pool released daily, of which 50% is obtained by the project team, and the remaining 50% is distributed as follows: 35% to Jukebox (nodes), 25% to the ecosystem, 25% to music NFT owners, 10% to artists, and 5% to founding nodes.

3.3 Address Analysis of Holders

Source: Scopescan

According to Scopescan data, the chart shows the top ten $MUSIC holding addresses, accounting for 56.01% of the total $MUSIC supply (35,385,689 Music). The top 50 holding addresses account for 72.88% of the total $MUSIC supply, and the top 100 holding addresses account for 80.99%, indicating a very high concentration of holdings. The second holding address belongs to Huobi exchange, with exchanges holding about 45% of the total $MUSIC supply.

Source: Nansen

According to Nansen data, major holders ranked high have been purchasing $MUSIC consistently over the past 7 days and 30 days, with few sellers, indicating that large holders are continuously accumulating their positions.

4. Advantage Analysis

4.1 Advantages of Web3 Music over Traditional Music

This section has been detailed in our previous report on the music industry, summarized as follows:

• Transparent and decentralized copyright management:

  Blockchain technology allows for accurate tracking and management of music copyrights, ensuring that creators receive the income generated from their creations. This provides greater trust and transparency for music creators.

• Automation of smart contracts:

  The application of smart contracts automates royalty payments, reducing intermediaries and allowing creators to receive their compensation more quickly. This mechanism not only speeds up payment but also improves the efficiency of copyright distribution.

• Promotion of the creator economy:

  Web3 music provides new momentum for the creator economy, emphasizing the independence and creativity of individual creators. Creators can achieve economic value through unique content, works, or services, gaining more autonomy and economic opportunities.

• Close connection between creators and fans:

  Web3 music allows upstream creators to connect more closely with downstream fans and listeners. Fans can interact more closely with creators, providing feedback and suggestions, while creators can better understand audience needs, leading to the creation of more popular works.

• Innovative music service models:

  NFT-based music works not only have "listening value" but also possess tradability and combinability. Through online stores and artist merchandise sales, entirely new music service models and scenarios can emerge, bringing more business opportunities to the music industry.

With these advantages, Web3 music is expected to bring a fairer, more transparent, automated, and innovative development direction to the music industry, creating a better ecosystem for music creators and fans.

4.2 Advantages of Gala Music

The Web3 music sector, which we can also refer to as MusicFi, has seen projects like Audius perform brilliantly in the last bull market, with $AUDIO reaching a market cap of up to $5 billion. Now, $MUSIC is the project most likely to lead the next wave of the MusicFi trend. Let's see what highlights $MUSIC has.

• Backed by Gala:

  The success of Gala Games in the last bull market is evident, and we can fully trust the marketing capabilities of the Gala team. As one of the pillars of the Gala ecosystem, it is not impossible for $MUSIC to replicate the trajectory of $Gala.

• Top-tier partnerships:

  Snoop Dogg is a long-term partner of Gala Music, and he is not only well-known in the hip-hop music circle but also globally recognized. Having Snoop Dogg as the face of Gala Music can provide higher market recognition for Gala Music.

• Quality team:

  As mentioned earlier, the CEO of Gala Music is the first manager of 2PAC. We can imagine the connections in the hip-hop music circle, laying a solid foundation for Gala Music's future collaborations with more well-known artists.

• Newly issued token: $MUSIC is a newly issued token in the Web3 music sector, with a relatively low market cap compared to other projects in this sector, around $13 million. It has not experienced a bull market, unlike $AUDIO, which has many trapped positions and selling pressure above. We expect $MUSIC to perform better in this bull market.

5. Project Risk Analysis

Although Gala Music has set up a mechanism to alleviate oversupply and undersupply in the ecosystem, the core of the platform's survival and development still relies on the purchasing power of artists' fans for $MUSIC, which is the demand part of the ecosystem. If demand sharply decreases, no mechanism can prevent the token price from falling (oversupply).

The platform needs to continuously monitor and improve the quality of music on the platform and sign contracts with more popular Web2 artists to bring their traffic to Gala Music and increase the empowerment of $MUSIC, ensuring sufficient token demand.

6. Conclusion

Web3 music demonstrates multiple advantages over traditional music, including transparent and decentralized copyright management, automation of smart contracts, promotion of the creator economy, close creator-fan relationships, and innovative music service models. This brings a fairer, more transparent, automated, and innovative direction to the music industry, enhancing the ecosystem experience for creators and fans.

As a representative of Web3 music, Gala Music shows clear advantages in being backed by Gala Games, signing top figures like Snoop Dogg, having a quality team, and being a newly issued token. It is expected to lead the next wave in the Web3 music sector, especially through collaborations with well-known artists and the characteristics of the newly issued token, potentially achieving better performance in the bull market.

However, project risks also need to be noted. Although Gala Music has adopted a supply-demand mechanism to alleviate imbalances in the ecosystem, it still relies on the purchasing power of artists' fans for $MUSIC. If demand decreases, the token price may be affected. Therefore, the platform needs to continuously improve music quality, sign contracts with popular Web2 artists, bring their traffic to Gala Music, and strengthen the empowerment of $MUSIC to ensure sufficient token demand, thus maintaining the ecological balance of the platform.

【Disclaimer】This report is an original work completed by student @EdisonHuu of @GryphsisAcademy under the guidance of mentor @CryptoScott_ETH. The author is solely responsible for all content, which does not necessarily reflect the views of Gryphsis Academy or the organization that commissioned the report. Editing content and decisions are not influenced by readers. Please be aware that the author may hold cryptocurrencies mentioned in this report. This document is for informational reference only and should not be used as the basis for investment decisions. It is strongly recommended that you conduct your own research and consult neutral financial, tax, or legal advisors before making investment decisions. Please remember that past performance of any asset does not guarantee future returns.