Turntable.fm co-founder Billy Chasen recently took to Product Hunt to unveil his latest creation — DoubleLock. The product creates two “keys” which must both be entered in order for a file to be unlocked or modified. Perhaps in light of the Ashley Madison hack, Chasen’s use cases involved naughty pics and videos, but there are plenty of less salacious uses for a product like this. In cases of severe illness or death, you could provide two trusted friends with keys to unlock social media and personal finance accounts — a hedge against anything going off the rails if one of those two people turn out to be untrustworthy. While DoubleLock is still in its infancy, it might be the product that introduces the idea of a multi-sig smart contact into the mainstream.

Smart contracts are contracts that are automatically executed by a computer program; in order for them to be changed, all parties must use a key to unlock the contract and consent to the modifications. The idea of the smart contact has been around since the early nineties, but because there was no one universal and digital financial system to facilitate payments, the concept languished. With the rise of the blockchain and bitcoin, however, interest in smart contracts has grown.

For artists, this could mean the dawn of a new era of payment transparency. At the simplest level, smart contracts could ensure that each band member gets his or her fair say when anyone wants to change a deal. We’ve all heard horror stories about unscrupulous managers or band members who cheat other members out of royalties; most recently, this narrative appeared on the big screen in “Straight Outta Compton.” An expectation of transparency, facilitated by smart contracts, represented a step forward for artists who want to be protected and make sure they are compensated fairly.

Assuming smart contracts can be used on a mass scale, this would also give artists more negotiating power. If a group of artists all have contracts with a single party, they could collectively bargain in order to get better terms, because they all hold the power to hold out until they get a fair deal.

On the back end, smart contracts have the potential to open up the black box system that has come to characterize most payouts. If you follow music and tech at all, before long you’ll likely run into an artist sharing a story about getting a check for a small, random amount and being completely befuddled about how ten thousand plays worked out to twenty-seven cents. It’s the same record label math that led to an artist who sold a million record still not recouping. But a smart contract system would allow artists to track money every step of the way and for each member to make sure they were being paid the correct amount. They also allow for payments to be made automatically — no more waiting around for a check or a deposit to clear.

Smart contracts could also act a defense for major labels. If they put up money to pay for expensive producers and guest verses, they should be able to make the money back, and having everything laid out clearly creates a system where everyone knows where the money is going.

There are a few other benefits of smart contracts that artists might want to explore. Some developers are working to combine the blockchain with the “internet of things;” for instance, if I rent a house on AirBNB, as many touring artists do, the house could unlock automatically once a payment clears. Artists who rent their equipment or vans while they’re not on the road to make some extra money could use smart contracts and shut off the rented gear if payments don’t go through, which is much easier than tracking down someone halfway across the country and forcing them to pay up.

As more artists demand transparency and accountability, smart contracts and multi-key systems will quickly come to represent the new normal. In a few years, we’ll all look back and wonder why we put up with “dumb” contracts and even dumber passwords in the first place.

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Can Smart Contracts Help the Music Business Be More Transparent?

Category: Blockchain

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