Before I begin, I should point out I’m a fan of Choon, a music service that combines music and crypto currency in order to create audio-based fun times and frolics. Since discovering the platform and signing up for it earlier in the year, I haven’t personally seen or heard anything from the service that contradicts their stated goal of creating an environment that’s fairer for everyone – creatives and listeners alike.
Nonetheless, a few weeks ago, there were a number of Choon artists left with a very bad taste in their mouths.
The problem lay on the crypto side of the service. Choon’s economy is based around its own utility token, ingeniously titled Notes, which lurks on the Ethereum network. Though users have been able to earn NOTES since day one, the token was locked to the service: Artists were free to export notes to their own Ethereum wallet, but they had no way of swapping tokens for other currencies on the open market. At least that was until the token was formally unlocked at midnight on Saturday the first of December. Suddenly, the artists of the Choon ecosystem found out how much money their months of streams was really worth and, as you may already have gathered, This turned out to be lower than most were expecting.
Though Choon’s (subsequently cancelled) initial coin offering had early suggested an exchange rate of around 10,000 notes to 1 ethereum (with 1 ethereum being worth the best part of £300 at the time), NOTES are (or by this point, were) currently trading at around 40,000 notes to 1 Ethereum, with a single Ethereum having a market value of just £93. As of today, those 10000 notes can’t even be exchanged for ten thousand pennies.
Although a little disappointed (As someone with a vested interest, I have to admit that a good chunk of extra Christmas pocket money would have come in handy), I can’t say I’m terribly put out by this. Though the value of the token is the news that has been grabbing the headlines, the real takeaway should be that Choon were as good as their word. The team said they would unlock the token on the first of the month, and they did just that. If you’re a Choon artist, you will receive any notes you earn today as soon as the clock hits midnight PST, and you can withdraw them from the service on the spot. In comparison to rival streaming services that really is a pretty big deal.
Unfortunately the importance of this fact – alongside the surprisingly high amount of fiat currency a single stream is worth – has been completely overshadowed by NOTES failing to meet initial expectations. Are the team completely blameless? Well, to be fair to them the team have always been pretty explicit about their vision of having NOTES as a utilitarian tool linked to the growth of the platform rather than a play thing for speculators:
Are NOTES transferrable? Can I trade them on exchanges?
NOTES will become transferrable following the conclusion of our Token Generation Event. We are notable to speculate about NOTES being listed on cryptocurrency exchanges but will endeavor to providean up-to-date list if and when this happens.
Should I buy NOTES to sell them for more money?
No. NOTES, like all blockchain-based assets, will likely be highly volatile, and there will be a high chance of losing all of your money. We do not recommend you use NOTES for short-term gains, tipping, or day trading.
Why does Choon use its own token NOTES, as opposed to Bitcoin or Ethereum?
NOTES are a utility token, not a digital currency. They can be used as units of account between listeners and artists and can be distributed to artists based on Smart Record Contracts. This distinct in-house oroblem solving is better handled by our own token. In addition, an integral part of Choon is the distribution of 50% of the overall supply of NOTES to artists via our Streaming as Mining system, which will be used to incentivize artists to join the Choon Platform. This was only possible via the creation of a distinct token.The Choon White paper: https://www.choon.co/public/pdf/choon_white_paper.pdf
However, Though this is undoubtedly a positive thing, it’s also noteworthy that the 10000 NOTES to 1 Ethereum exchange rate originated from the documentation created for Choon’s cancelled ICO. Given that many of Choon’s artists come from a musical background rather than a Crypto one, it may have been helpful to have the lay of the land explained in advance of the unlock (though, with that said, we should also remember that legally it may have been difficult for Choon to do this). Mind you, post unlock, it’s also worth noting that the official channels have been good at pushing users towards helpful third party explanations of what’s been going on with the token, so we can’t that they haven’t tried to help.
Either way, if you’re a Choon artist who finds themselves holding to what seems like monopoly money, should you despair? Personally, I don’t think so. One thing that everyone seems to have forgotten is that individual Choon streams are worth a lot more than a single NOTE. Though the streaming-via-mining model means that the precise number of notes varies by the day and on the length of the song, a 3-4 minute song seems to pull in somewhere around 15-30 NOTES. Out in the real world, this translates to around £0.03 a stream.
Sure, The thirty quid you’d recieve for 1000 streams might not exactly be enough to pay the rent, but it’s still many, many times larger than the £4 you’d recieve for 1000 German streams on Spotify. On top of that we should also remember that Choon is a relatively small platform that isn’t even out of beta yet, something that makes out-paying the industry leader doubly impressive.
Another reason to be relatively excited about Choon is their roadmap. Although it’s noteworthy that Choon cancelled their ICO and moved the token unlock back to December, they were pretty forthcoming with their reasons for doing – reasons that made a great deal of sense considering the tough conditions surrounding crypto in general. Those Cancellations aside, it also looks like the roadmap is developing mostly on track. Recently, for example, we’ve seen the deployment of the note-related profile badges that were supposed to come as part of the gamified staking updates next year, while earlier this year Choon managed to deploy improvements that were in the roadmap – such as monetised playlists – alongside some features that weren’t – like the ability to tip notes to favourite artists/curators.
This is especially important as the most vital updates – the updates that will take the service out of beta – are still to come. If the Choon mobile apps are launched in the relatively near future and the team can establish the proposed gateway to turn normal fiat currency into NOTES by the end of next summer, we could be looking at a service with a much larger userbase in a year’s time.
Overall then, I’d say don’t worry too much: as Choon artists we’ve signed up to a service that currently features a stable and light-weight audio play, mechanisms to ensure easy cooperation between us and a solid way of incentivising curators to use our music – all while paying both more money per stream and more regularly than the competition to boot. A bit of extra money is always nice to have around Christmas time, but let’s not let one temporary negative outshine some tremendous past current and (hopefully) future positives. I look forward to keeping my eye on what the Choon team get up to in the new year.