The story
- Proto-Germanic*kippōną
- Proto-West Germanic*kippōn
- Old English*ċippian
- Old Englishċipp
- Middle Englishchippe
- Englishchip
- Englishtune
- English todaychiptune
From chip + tune, referring to a computer's sound chip; see chip (“electronic circuit”). Initially in the meaning of modules, as an antonym to 'real' chip music, then generalized/recontextualized.
Etymology from Wiktionary, CC BY-SA 4.0.