Hollywood has reached a breaking point. Audiences are tired of franchise sequels and reboots. YouTube has surpassed Disney as the world’s largest distributor. And Gen AI tools like sora 2 can soon turn anyone into a filmmaker. However, one thing hasn’t changed: how movies are financed.. And that is why we receive fewer and fewer original films.
Decline of original screenplays at the US box office (1984-2023)
Fountain: The numbers and the charm of the box office
For decades, filmmakers have had only two ways to raise capital: courting wealthy “patrons of the arts” or ceding intellectual property in restrictive deals with studios. These small circles still control who will be the next David Lynch or what movie will be next. Napoleon dynamite, while everyday fans, the people who live and breathe these movies, have never had a seat at the table. (Less than 1% of Americans meet the SEC’s “accreditation” standards to invest in most private companies, including film companies.)
That is finally changing thanks to tokenization. The promise of “cinema decentralization” has arrived, this time quietly and legally. A few years ago, “Web3 Film” had the right dream but the wrong tools: people were cutting movies into NFT frames, promoting complex tokenomics, and skirting securities laws. None of that worked. Projects like stoner catsAshton Kutcher’s NFT cartoon, became a warning after the SEC cracked down on selling unregistered securities to unaccredited investors.
Today, the difference is compliance. Through licensed platforms operating under SEC exemptions, such as Reg CF, production companies can hire thousands of non-accredited investors (including in the US) to back real-world film projects and share in the profits. Security tokens issued on blockchain rails make it possible to distribute dividends transparently and profitably and, eventually, trade investors’ stakes in secondary markets.
And it’s already working. Tens of thousands of investors have contributed more than $30 million to premium productions from some of the most respected names in Hollywood. This year, Roberto Rodriguez (Sin City, Spy Kids) raised $2 million from 2,000 fans to invest in new action movies, and each investor was able to pitch him a movie as part of the slate. film press – the company behind American psycho, financial world and the crow — raised $2 million for a series of bold, original films, and is already starting to return capital in six months. AND Eli Roth (Hostel, Inglourious Basterds) launched a fan-owned horror studio that maxed out its $5 million Reg CF campaign in July. He was tired of studios considering his ideas too gory, even though the most profitable film of 2024 was the unrated slasher, Terrorist 3.
Tokenized investment by fans is opening new avenues for capital and creativity. Filmmakers can now turn to their audiences for capital rather than accepting the studio contract, allowing them to retain greater ownership of their intellectual property and take creative risks without interference from lawsuits or the algorithm. For fans, tokenization opens access to a previously inaccessible opportunity: investing in movies as an alternative asset class. Ultimately, these projects tend to perform better, not only creatively but also financially, as audiences with skin in the game generate buzz and box office returns.
The timing couldn’t be better. With IPOs slowing and private markets growing, tokenization is unlocking billions in household capital and opening doors to previously reserved opportunities in private credit, venture capital and now, film. The GENIUS Act has brought long-awaited regulatory clarity to digital assets, while institutions from BlackRock to Visa are integrating blockchain infrastructure into the mainstream economy. Tokenization has quietly moved from crypto casino to financial plumbing, and entertainment is proving to be one of its most identifiable (and necessary) use cases.
There may be no better Trojan horse for the widespread adoption of tokenization than real-world cultural assets (RWA). Few industries are as primed for disruption as film, and none are as universally relatable, considering almost all of us end the day watching Netflix (and then complain about the content). But when audiences can invest in the projects they want to see, whether from established filmmakers or up-and-coming creators, we won’t just get new funding models. We will have better movies.
