On a new primitive for music — the Audio Fungible Token (AFT) — and why the last decade tried to solve the wrong problem.
Music was never supposed to be an NFT.
That isn't just a provocation; it is a structural critique of a decade-long misfire. For the last several years, crypto tried to rescue the music industry by turning songs into non-fungible tokens. They minted one-of-one digital art cards, attached an MP3, and slapped a astronomical price tag on them for wealthy collectors. It was well-meaning, but it failed completely. Not because artists don't deserve better pay, and not because blockchains lack utility, but because treating a song like a rare oil painting is a fundamental category error. Fine art derives its value from artificial scarcity; music derives its value from ubiquitous repetition.
So I want to make the case for a different primitive — one I've spent months architecting, and one I believe represents the true financial future of music: the AFT, the Audio Fungible Token.
The problem no one actually fixed
Start with what's broken, because it's worse than most people realize. A streaming platform pays an artist somewhere in the neighborhood of $0.003 to $0.005 per stream. That means hundreds of plays yield a single dollar — and only after the label, the distributor, and every corporate middleman takes their fee. The creators who write the soundtrack to our lives capture only a microscopic fraction of the value they generate.
Look at the other side of the equation: the fans. A fan can discover an underground track on day one, share it incessantly, stream it a thousand times, and fuel its rise into a global hit. What do they get for generating that immense cultural momentum? Zero financial upside. Every dollar of value created by fan attention flows directly to centralized platforms and legacy catalog owners. The fan gets a digital memory; everyone else gets paid.
Meanwhile, actual music royalties remain opaque, sluggish, and locked behind closed doors. Payouts trickle out quarterly through shadowy accounting houses in statements no artist can independently audit. There is no open, liquid market where a song's real-time financial trajectory can be priced or traded. The most emotionally resonant asset class in human history runs on stone-age financial rails.
Why NFTs were the wrong shape
NFTs promised to fix this, but they couldn't. The failure was baked into the architecture, not the execution.
An NFT is non-fungible: unique, indivisible, and valued precisely because only one person can hold it. That container works for assets built on scarcity — a original canvas, a physical artifact, a rare privilege.
A song's value is the exact inverse of scarcity. It is fungible and recurring. A song compounds in worth when it is played millions of times over decades across streaming services, sync licenses, radio, and venue speakers. A hit song is not a static collectible; it is a recurring cash-flow engine. Forcing a high-frequency, shared cash-flow asset into a single non-fungible token is like trying to represent the market cap of Apple with a single baseball card. The container actively suffocates the asset inside it.
Fix the primitive, and the entire ecosystem aligns.
The AFT: a new primitive
An Audio Fungible Token is a liquid, divisible token tied directly to a track. It solves the structural flaw of music NFTs by delivering three capabilities a collectible can never offer:
-
Your balance unlocks the music. Holding the token grants direct, programmatic access to the audio. You acquire the token into your wallet and listen immediately, long before any external market even opens.
-
The transfer fee is the artist's royalty. Every time an AFT changes hands, a small fee is taken directly on-chain. The majority routes instantly to the artist, while the rest distributes to fans who stake the token. The artist gets paid on the initial release and on every secondary trade forever — instantly, transparently, with no label intermediaries.
-
It trades in a real market. Because AFTs are fungible, thousands of fans can simultaneously own fractions of the same song. The track gains a liquid, transparent price discovery engine where its market value scales with its popularity.
In plain terms: an AFT merges streaming access, automated royalty capture, and liquid ownership into one unified token. It is the architectural polar opposite of a music NFT.
Why an AFT needs its own market (the hard part)
Building an AFT sounds straightforward until you encounter the DEX problem: you cannot trade a fee-on-transfer token on a standard decentralized exchange.
Here is why. Standard DEXs use liquidity pools and mathematical formulas designed for normal tokens that transfer 100% of their balance. When a token automatically skims a royalty fee during a transfer, generic exchanges get confused. They deduct the fee when you send tokens to the pool, and then deduct it again when the pool completes the swap. The math breaks, traders get double-taxed, and transactions fail. The very royalty mechanism that feeds the artist destroys standard trading engines.
To solve this without compromising the royalty, the market itself must be custom-engineered. The engine I built is an automated market maker designed specifically for fee-on-transfer tokens from the ground up:
-
One fair fee: The router handles token movements so the royalty is assessed exactly once per trade. Fans trade smoothly without suffering hidden double taxation.
-
Fair-launch presales: An AFT begins as a non-transferable token during its presale phase. The public trading pool opens strictly at the price established by early fan backers. Snipers and insiders cannot front-run the launch pool or dump on early supporters.
-
Immutable royalty distribution: The artist's payout address is permanently hardcoded into the protocol. Pricing relies on manipulation-resistant internal accounting rather than fragile external data feeds that could freeze transactions. Buyers can verify every line of code to know their money reaches the creator.