- Meta announced that it is pausing its plans to enable sharing of non-fungible tokens (NFTs) and digital collectables on Instagram
- Last year, Meta made a big push into NFTs and digital collectables
- With the mixed results that mainstream platforms are experiencing with NFTs, it may be time to ask if NFTs are ahead of their time
Meta, the tech and social media giant, has announced that it is pausing its plans to enable sharing of non-fungible tokens (NFTs) and digital collectables on Instagram, only a year after unveiling the initiative. This move comes as the company shifts focus to other ways of supporting creators, businesses, and users, according to Stephane Kasriel, Meta’s Commerce and Fintech lead.
Non-fungible tokens (NFTs) are blockchain-based cryptographic assets bearing unique identification codes and information that separate them from one another.
NFTs cannot be traded for one another or swapped. This attribute contrasts fungible tokens, such as cryptocurrencies, which are identical to one another and may therefore apply as a medium for economic transactions.
NFTs offer the potential for a variety of applications. They are, for instance, an excellent vehicle for digitally representing actual assets such as real estate and artwork. NFTs, since they rely on blockchains, may also be used to eliminate intermediaries and link artists to their fans, as well as for identity management. NFTs have the potential to eliminate intermediaries, streamline transactions, and generate new markets.
Meta went all in on Instagram for NFTs
Last year, Meta made a big push into digital collectables after Mark Zuckerberg, CEO of Instagram’s parent company Meta, announced that non-fungible tokens—better known as NFTs—would be coming to the picture and video-sharing app at the South by Southwest conference in Austin. The features were, however, only made available to a select group of creators, and never widely released.
Mark Zuckerberg, the CEO of Meta, announced in August 2022 that the company would expand its support for non-fungible tokens (NFTs) on Instagram to users and businesses in more than 100 countries Africa, Asia-Pacific, the Middle East, and the Americas. This follows the social network’s initial NFT test launch in May, which was only available to select creators in the United States.
As part of this expansion, Instagram accepted Coinbase Wallet and Dapper Wallet as third-party wallet options for users. Additionally, the social network is expanded its supported blockchains to include Flow.
Meta’s NFT plan for Instagram
Instagram’s NFT functionality would enable users to connect a digital wallet and share NFTs with automatic attribution to both the creator and collector. Users would be able to share NFTs in their main Instagram feed, stories, or in messages. Digital collectables were to be marked with a shimmer effect and the ability to display public information, such as a description of the NFT.
To post a digital collectable on Instagram, users would have to connect their digital wallet to the platform. Instagram added support connections with third-party wallets including Rainbow, MetaMask, Trust Wallet, Coinbase Wallet, and Dapper Wallet, and supported blockchains including Ethereum, Polygon, and Flow. Posting or sharing a digital collectable on Instagram incurs no fees.
Meta previously announced its plans to work on augmented reality NFTs, or 3D NFTs, that could be brought to Instagram Stories using Spark AR.
Meta wanted to expand access to web3 technology through NFTs and support creators who want to monetize their work and build communities with their fans and collectors. The company also noted that it is committed to reducing the emissions impact associated with the display of digital collectables on Instagram by purchasing renewable energy.
Others succeed with NFTs
Meta began testing NFTs with select creators on Facebook. Twitter also enabled NFT profile pictures for premium users earlier in 2022. Additionally, Reddit also launched a new NFT-based avatar marketplace that allowed users to purchase blockchain-based profile pictures for a fixed rate.
Twitter went on to further integrate NFT sales, purchasing and displaying of NFT avatars within the platform. Spotify has also expanded token-gating support for NFT-enabled playlists. This offers users who own particular NFTs access to curated playlists
Not the end of the road for Meta
Despite pausing its NFT project, Meta will continue investing in fintech tools for consumers and businesses. The company is streamlining payments with Meta Pay, making checkout and payouts easier, and investing in messaging payments across Meta.
Kasriel also thanked the partners who helped develop NFTs on Instagram. “Proud of the relationships we built,” he said. “And look forward to supporting the many NFT creators who continue using Instagram and Facebook to amplify their work.”
Although Meta is stepping away from NFTs, Kasriel wrote that the company had learned a great deal that it could apply to products it is continuing to build to support creators, people, and businesses on its apps, both today and in the metaverse.
Between October 2021, when Facebook rebranded to Meta, and December 2022, the price of Meta’s stock dropped 60% from $323.57 to $114.74. The stock recovered somewhat in the 1st quarter of 2023 and is currently priced at $180.90, according to MarketWatch.
Are NFTs ahead of their time
With the mixed results that mainstream platforms are experiencing with NFTs, it may be time to ask if NFTs are ahead of their time. NFTs are built for a web3 world but operate in a world that is by and large in web2. What Meta is going through when it comes to NFTs isn’t unique.
A look at recent technology developments shows a similar problem. Instant messaging for example was great and wonderful throughout the 2000s. Chatrooms and messaging platforms were strong but instant messaging didn’t have universal appeal. Then came the smartphone and everything changed. Instant messaging found popularity on mobile smartphones. The internet speed and capability also contributed to this.
NFTs are in that strange space that mobile phones were caught in the late 1990s. For those who don’t know the phone designs and features were outrageous. Manufacturers and developers looked for ways to make sense of these devices to users. Mobile phone cameras entered the market as additional attachments to phones.
What Meta is experiencing isn’t unique. NFTs are still taking their first steps to find their winning use case. It may be time to accept that they are simply ahead of their time.
It remains to be seen what other initiatives Meta will launch to support creators, businesses, and users. The company’s track record suggests that it will continue to innovate and evolve to meet changing needs and expectations.