AUDIUS: The Future of Audio Content

In 2021 a musician does not need a record label to access the latest audio recording equipment, press vinyl, reach fans, cultivate an audience, plan releases, or book venues. So, what does an artist need a Record label for? The answer is capital. All the things listed above cost money and most streaming services pay between $.003 and $.005 per stream. In a world of digital streaming an obvious way to help artists acquire capital would be to up their pay per stream. This is where Audius comes in.

Audius’s mission is to give anyone and everyone the freedom to distribute, monetize, and stream any audio content using a protocol that will live forever and be co-owned by a decentralized community of artists, developers, and fans. Audius will also be empowering artists by giving them access and control of all their data and allowing them to communicate directly to fans. Audius is building a system that incentivizes fan and artist interaction and allows for direct funding of artists by fans. In July 2021 Audius had 3,822,997 unique users and 5,790,100 plays. In August 2021 Audius had 6,042,136 unique users and 6,513,684 plays. If we weigh these numbers with the 84,190,191 total API calls Audius has received just in the month of August 2021 we can start to grasp the impact and adoption rate of Audius. This of course follows the August 16th, 2021 news of Audius’s partnership with TikTok which makes Audius one of the first streaming services to sign a deal with a social media application. Many unknown music artists have seen their popularity skyrocket due to videos that use their music going viral on TikTok. Audius now has a simple share button on their streaming platform that seamlessly imports music tracks into the TikTok app.

Who and what is behind Audius?

Audius was founded by Roneil Rumburg, CEO and Forrest Browning, CPO. Both Rumburg and Browning are Stanford grads with credible backgrounds in tech. Rumburg is a co-founder of a Bitcoin p2p transaction platform called Backslash and most recently co-founded Kleiner Perkins' early-stage seed fund which most notably has made a seed investment in Lightning Labs who is building a layer two on top of Bitcoin which allows for cheaper and faster Bitcoin transactions. Browning is a co-founder of Stacksware which is a company that provides data analytics for fortune 500 customers. Browning is also a Forbes 30 under 30 recipient. Audius has raised venture capital from firms such as Blockchange Ventures, Multicoin Capital, and General Catalyst just to name a few.

Audius launched their music streaming and free hosting service on September 24, 2019. Since then, Audius has become an increasingly popular streaming service that is very reminiscent of SoundCloud in its early days. The important difference between Audius and all other existing streaming platforms is Audius’s reliance on blockchain technology. Audius uses the blockchain to keep a decentralized ledger of content that is quarriable by users. This decentralized ledger of content is kept by nodes that act as an API (Application programming interface) between users and applications. Theoretically any program developer could create an application that utilizes the Audius ecosystem and communicates with Audius’s nodes to provide identical content.

This is extremely bullish for the $AUDIO token. At first glance Audius.co looks like a fresh new audio streaming service but behind the scenes sit the qualities that make Audius interesting. Audius is a Proof-of-Stake blockchain meaning that record keeping and ledger movement are recorded and processed by nodes. Individuals stake a certain amount of $AUDIO as collateral for the value they provide through recording or processing. Nodes are rewarded with network fees and participation in governance while their staked $AUDIO tokens keep them honest and fair. A misbehaving node may have some or all their staked $AUDIO ‘slashed’ which means their staked $AUDIO is destroyed which incentivizes nodes to work for the communal good of the blockchain. Artists and users may stake their $AUDIO for access to special features and governance. There are currently 284 million $AUDIO staked as of 8/31/2021. This is equal to $704,320,000 USD at the current price of $2.48 per $AUDIO. The end users, however, do not need to know what's going on behind the scenes to use Audius and its $AUDIO token. Audius’s streaming service is just as easy to use as Pandora or Spotify yet it’s potential supersedes any streaming service out today.

Why did we invest?

Audius fit our investment thesis superbly. The team is highly credited and competent. The whitepaper made sense and was straight to the point. The tokenomics and incentives for staking and trading the token were fully fleshed out. Audius had both smart money and an already existing ecosystem of users and developers. A purchase of the $AUDIO token was a no-brainer at that point in our research. Our initial investment was made on July 6, 2021 when the $AUDIO token was trading at $.84. At the time the market cap for $AUDIO was $196,937,551 and the trading volume was $27,831,418.

What Now?

Keeping track of key performance indicators are necessary in planning an exit. Currently we still believe $AUDIO is undervalued and is therefore a long-term hold. The potential Audius has is not unlimited yet the room $AUDIO has to grow in terms of market cap is astounding. On September 3rd, the day on which I am writing this, the market cap for $AUDIO is 1.1 billion. Coins like bitcoin and Ethereum hover around triple digit billion market caps. Now if we take the Theta Network which is a project that uses blockchain technology for video streaming and look at their native token $THETA we can see that they are sporting a roughly 7-billion-dollar market cap. Given what we know we can imagine $AUDIO reaching numbers much higher than where it currently sits. The key performance indicators to watch out for are adoption and development. As long as the Audius foundation continues to grow and support developments the $AUDIO token will increase in value.

Written by David Coryat, Crypto native and analyst at Istari Capital LP.

This Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. Nothing contained in this report constitutes a solicitation, recommendation, endorsement, or offer by Istari or any third party service provider to buy or sell any securities or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the securities laws of such jurisdiction. Please be advised that Istari Capital LP is invested in the project discussed in this article or in projects related to this article.