The ’70s brought the rise of the Deadheads, the Grateful Dead’s cult-like followers. The ’90s saw the transformation of Pearl Jam’s Mother Love Bone Earth Affair into Ten Club, a subscription-based artist community. And the 2010s featured the short-lived Swift Life app, Taylor Swift’s own mobile platform for her fans. Now, a growing group of artists and labels, including Mashibeats, Ropeadope, and most notably, Portugal. The Man, is experimenting with evolving the music fan club concept even further.
In the case of Portugal. The Man, the “Feel It Still” band out of Wasilla, Alaska, and based in Portland, Oregon, has partnered with Web3-focused creator platform Rally to link its fan club to the blockchain with the new site ptmcoin.com. The online hub marries the user experience of a traditional website, but for fans to gain access they must own at least one $PTM, the band’s creator coin (also known as a token). Once an owner, perks like unreleased audio, pre-sale tickets and merch become available.
$PTM is a cryptocurrency built on $RLY, a token that governs the RLY Network which is a separate but connected network (known as a sidechain) of the Ethereum blockchain.
Portugal. The Man have been early adopters to Web3 and have had a creator coin for over a year, but this latest development is intended to make its ownership and utility more accessible to fans.
When the band initially launched its $PTM tokens in January 2021, fans had to create an account and digital wallet through Rally.io and then purchase the coin using a credit or debit card or other cryptocurrencies. Once a user had at least one token in their wallet, they would then need to join a channel in the chat-based application Discord. Then they could connect with fellow token owners and access material available through a link to a restricted Google Drive folder, which included archival footage and song files.
Now, working with Rally and Bonfire — another company that develops digital tools to help creators monetize their work — the new web portal combines the tech of Web3 (wallets and token-gating) but aims to reduce friction for fans to onboard and contribute. Its components are now accessible through one website (rather than three) that organizes the content, which includes streamable music – setup by year-by-year – unreleased videos of the band, and other exclusive items like guitar tabs and show pre-sales.
“We’re trying to make Web3 experiences accessible to people who might not even know that they’re playing in a Web3 world,” explains Bryce Carr, director of music creator partnerships at Rally. “From the crypto-bro who has been a fan for years to the older mom that discovered the band from a radio hit.”
According to the Portugal. The Man’s Rally creator page, there are just over 3,200 individual $PTM holders, including the band, and more than 144,000 $PTM in circulation. Like a stock or commodity, the price of coins on Rally fluctuates based on demand. And theoretically, if an artist brings more fans into their community or creates more token-related benefits, that leads to more purchases and the price of the coin (and the value of fans’ wallets) increases. If the creator or their fans decide to sell their tokens, the price drops. At the time of writing, the value of one $PTM is $1.43 USD. If you think of coins in the same way as shares in a company, today the total value (or market capitalization) of all available $PTM is approximately $205,000 USD. This number has varied dramatically since $PTM was first launched. An individual coin has been valued at as low as $0.30 (80% below today) in early 2021 and as high as $60 (4,000% above today) in May 2021.
When asked what accounted for the significant rise and fall in the value of $PTM, a Rally spokesperson said that it “does not comment on the price of creator’s tokens.” They noted that “fans are buying for access to content, not expectation of profit or ownership in a company. This is evidenced by the number of purchasers that have taken advantage of PTM’s token-gated benefits.”
Volatility and unpredictability are two reasons why crypto projects often come with skepticism. Ventures where influential people solicit public investment and then vanish — leaving the people who bought into the project with a worthless coin — have become common enough that the practice has a name: a rug pull. This recently occurred when a group of software engineers claimed to be developing a crypto-card game based on the Netflix show Squid Game. They asked the public to purchase “Squid coin” to fund its development. The value of these coins grew to nearly $3,000. Then the coin’s creators vanished, with the value of the coin following suit, falling to almost zero, leaving its purchasers with nothing.
Such a case underlines the key issues with such membership tokens: It’s an upfront payment for down-the-line value. To flip Wimpy’s famous line from Popeye, it’s like, “I’d gladly pay you today for a hamburger Tuesday.” On why $PTM holders can trust the band to follow through on its promises, bassist Zach Carothers had this to say: “I think our fanbase knows that we always try to deliver a proportional value to things we ask them to come out of pocket on.”
Rally isn’t the only company helping artists to connect with and monetize their fan bases. Platforms like Patreon and Roll enable artists to collect subscription revenue from fans in exchange for exclusive content ranging from early ticket access to secret Snapchat accounts. The Rally-supported PTMCoin.com is still “a very traditional fan club experience,” Carr notes, “but built in a way where value is shared with community members, instead of extracted from them.” It, in a way, is comparable to investing in a company.
If a business’s value increases, so do the portfolios of its investors. In the case of $PTM, anyone who bought into its community early saw their stake (financial interest) in the community change as the coin’s price increased or decreased. They could then either sell their $PTM for fiat currency (similar to selling shares in a company to capture upside), or they could leverage the higher value of their $PTM to purchase limited edition merchandise from the band within the platform.
Portugal. The Man also has the option to “cash out” at any time – as in, sell their own coin to recoup USD. Jesse Wylde, music creator partnerships strategist at Rally, shares that some creators explicitly use the platform for revenue; however, Carothers maintains that, “To date, our band has not made nor have we tried to make money off our coin.”
While Rally has not publicly shared details on individual creators’ transactions or earnings, Wylde says that more than $58 million had been paid out as rewards over the past two years to the most active communities on the platform, including artists and fans.
For Portugal. The Man, Carothers says his group’s ultimate goal is simply to give their fans what they want. “We produce creative that they want, whether it be a song or a shirt or a concert. And they choose to spend their hard-earned money on it if it is good,” he says.
Carothers also shared that their efforts are not only in service of their fans, but in consideration of their peers as well. Their foray into Web3 — and its emphasis on removing the barriers to creator-fan connection — is also tied to their belief that the record industry needs to improve for everyone, including their fellow musicians.
“The music industry is terribly rooted in yesterday,” says Carothers. “Artists do not get nearly enough benefit from their output because of the long-existing structure.” He welcomes anything that shakes up the status quo. “Anything we can do that makes the next artist’s life a little bit easier is something we want to do.”