Introduction

The music industry has traditionally been exclusive, creating significant barriers for external financial participants and making music investment complex and limited. Despite these challenges, an active internal market exists, with hundreds of millions invested annually in music-related advancing and lending activities. High entry barriers persist, similar to those in alternative asset classes, and investors often perceive these investments as risky due to the specialised knowledge required to evaluate opportunities. The inherent illiquidity of these investments further restricts broader participation.

The industry lacks the technological infrastructure needed for effective capital allocation, leading to an inefficient risk-return profile compared to other financial markets. These inefficiencies present an opportunity for investors to achieve higher returns with comparable levels of risk.

Music Protocol addresses these challenges by using blockchain to create an accessible and efficient investment ecosystem. The platform employs a tokenisation model similar to other financial protocols, enabling investors to diversify their portfolios and exit investments early. Its liquidity mechanism mirrors the bond market, where yield rates and risk profiles determine investment values.

We are enhancing capital efficiency by establishing a liquid market for music royalties through tokenisation, facilitating seamless entry, exit, and diversification that traditional platforms do not offer, and reducing the complexities typically associated with music investments.

Development Approach

Music Protocol’s development will follow a phased approach, structured around key milestones that will ensure the platform evolves to meet both immediate needs and long-term goals for the music industry. The roadmap is designed to create a comprehensive, decentralised ecosystem for music IP and financial flows.

It is important to clarify that Music Protocol provides only the technological infrastructure to support the music industry, facilitating IP management and royalty flow through blockchain technology. The platform does not offer investment services or investment notes directly. Instead, we enable an ecosystem that empowers regulated entities to manage music-related financial activities through decentralised technology, while remaining distinct from the financial services sector.

The functionalities described in this document are part of the ongoing development roadmap and will become operational pending the necessary regulatory approvals. This phased approach ensures that our long-term vision is realised in compliance with all applicable regulations.

Any new utilities or use cases for the $RECORD token will also be subject to approval by relevant regulatory bodies. As such, all utilities mentioned in this document should be seen as a work in progress, contingent on compliance and formal approval.

As a provider of technological infrastructure, Music Protocol is committed to adhering to the regulatory frameworks that govern technology providers in the financial sector. This includes compliance with standards on cybersecurity, risk management, and other necessary obligations, ensuring the platform is secure, reliable, and trusted by all stakeholders.

• Phase 1: Financial System

• Phase 2: Liquid Record

• Phase 3: Transparency of Financial Flows

• Phase 4: New Blockchain for Dynamic Music IP