KLKTN CEO Daisuke Iwase & Warner Music Japan’s Takehito Masui Talk Possibilities of NFTs in Japanese Music Industry

Billboard Japan
·7 min read
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KLKTN was founded in March 2021 as an NFT platform for music, anime, J-culture and more. It was launched by Daisuke Iwase, co-founder of Japanese fintech venture company Lifenet Insurance Company, music producer and songwriter Jeff Miyahara, and Fabiano Soriani, former lead blockchain engineer at Dapper Labs.

Billboard Japan sat down with Takehito Masui and KLKTN’s CEO, Daisuke Iwase, to talk about the potential of NFTs in Japan, and KLKTN’s latest NFT project with Gesu no Kiwami Otome.

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Takehito Masui: To start with, could you tell us a little about your background?

Daisuke Iwase: I began Lifenet Insurance Company in 2006 and have been its president since 2013. After moving to Hong Kong, last year I decided to join Fabiano Soriani, who was involved in the development of CryptoKitties at Dapper Labs, and producer Jeff Miyahara, to establish KLKTN.

Masui: What was the impetus behind the creation of KLKTN?

Iwase: I felt that the time had come for Web3, the kind of profound change that only happens once every two or three decades. That’s why in late 2020, I began studying blockchain technology and cryptocurrency. I’ve always had an interest in the arts and culture. NFTs are a unique business that combines my experiences in finance and technology with my interest in art and culture, so I felt that would be an area where I could leverage the two. That’s what led me to begin KLKTN.

Masui: The tide of digitalization is rising in the Japanese music scene, but CDs still sell well even today. NFTs are digital yet ownable, so I think they would be of great interest to Japanese listeners.

Iwase: Right. I think the majority of people who buy CDs don’t do so just to listen to the music, but because they see them as having commemorative value. They’re what we call “collectibles.” In that sense, NFTs have a great deal of value to listeners. In the past, we digitized artist’s album liner notes and lyrics sheets, turning them into collectible NFTs for their fans. When we interviewed fans, they were just interested in albums as physical objects, they wanted to own them as works of art. So they were delighted to be able to own them in digital form.

Masui: What are KLKTN’s strengths?

Iwase: As I mentioned, Fabiano is our CTO.  At any NFT seminar, it’ll inevitably begin with a discussion of CryptoKitties, which Fabinao helped develop at Dapper Labs (previously known as Axiom Zen). CryptoKitties is a game in which you raise cats. More importantly it’s a game that introduced a lot of people to the word “NFT.”If CryptoKitties are what put NFTs on the map, NBA Top Shot is what pushed NFTs into mainstream popularity – (also by Dapper Labs). Having Fabiano, who’s been an integral part of NFTs’ history, as a core member of KLKTN is one of our key strengths. Fabiano, Jeff Miyahara, and I have highly varied backgrounds, and I think the way we combine our skills across technology, business, and the music industry really works to our benefit.

Additionally, we’ve been able to lean into a wealth of advice and experience from our shareholders Dapper Labs and Animoca Brands. Animoca Brands invests in a broad range of fields and are one of the largest investors in the NFT field. If you search for NFTs, one of the first things you’ll see are images of apesThis is Bored Ape Yacht Club, considered  a “blue-chip” NFT and s have sold for some of the highest prices of any NFT.Animoca Brands plays a central role in BAYC and many others.

Masui: On July 1, 2022, Gesu no Kiwami Otome took another step into the future by beginning selling NFTs with KLKTN. Web3 has the potential to transform past concepts and rules. I was impressed by what a deep understanding Kenta Kawatani had of Web 3, and by his evident optimism when discussing it. This project was launched because the band  decided to commemorate its 10th anniversary by changing their band name from ゲスの極み乙女。 to ゲスの極み乙女 , ” dropping the “。” from its name.

Iwase: Actually they didn’t change their name to sell it as an NFT.

Masui: Right. The project was created based on the fact that they were changing their name. What this project showed me is that NFTs can be effectively used as an extension of artists’ activities. Instead of thinking “What can we do to sell NFTs,” NFTs were used to add value to their name change. Previously, an event like this would’ve just been a simple announcement.

Iwase: There are a lot of areas that are vague or undecided when it comes to something so new like NFTs, but the essence of Gesu no Kiwami Otome is, itself, progressive, innovative, and playful. The artists were a driving force behind the project, which is crucial for its success.

Masui: I agree. We’re going to begin selling Gesu no Kiwami Otome NFTs in North America in the future. The band doesn’t have many fans there yet. What kind of opportunities do you see?

Iwase: I went to Coachella for the first time recently, and on the car ride there, the young Americans said “put on some tunes.” I played Gesu no Kiwami Otome’s “Dopamine” for them. They were like, “What is this? It’s great!” and started dancing to it. This was a moment that brought it home to me, Japanese artists could be very well received in America if given the chance.

Masui: The lyrics include “adrenaline, histamine, dopamine,” right? They aren’t pronounced with a native English accent but with a Japanese English, which I guess they might have found interesting. One of the things we realized is that we don’t have to aim for a “natural” English pronunciation, but that the Japanese accent itself creates opportunities.

Iwase: In North America, we aren’t focused on music fans as much as we are on getting NFT collectors and investors to learn about Japanese content and see its potential.

Masui: So people who are interested in NFTs would become interested in Gesu no Kiwami Otome NFTs, and discover that there’s this really fascinating band out there. NFTs could serve as the introductions to artists internationally.

Iwase: NFTs could become a new means of expression. Even for major artists, you can’t just take something that already exists and make an NFT out of it. It won’t sell well. When you use the NFT format to create something new, those NFTs sell well. That’s why we want to take on the challenge of using NFTs to create things that fans will love.

Masui: What potential do you think NFTs have in the future?

Iwase: I’m actually at NFT.NYC right now. This is the world’s largest annual NFT event (this interview was conducted on June 22), and I was pleasantly surprised by how many f people are from Japan. 

I’ve been to a lot of seminars, but nobody has all the answers. Given how new NFTs are, so it feels like we’re all learning as we go. The prices of NFTs have fallen drastically, and there are a lot of people who have lost a lot of money. Many projects have disappeared. Even just a few months ago people were spending hundreds of thousands or millions of yen on NFTs. The whole industry was experiencing a bubble. That’s why we’re taking a more grounded approach, thinking about what we need to do to build a long-term, widespread presence of NFTs. There’s still a tremendous amount of passion and excitement in the air. NFTs enable fans to own part of the creative process and its output. We hope to provide NFTs as a way to connect artists with their fans, beyond just CDs and merchandise.

Masui: I look forward to taking on more of these challenges. Thank you for your time today.

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