At the beginning of the year, Twitter introduced non-fungible tokens (NFTs), as hexagon-shaped profile pics to its premium users, on its platform. Reddit followed suit and revealed that they too were looking at NFT avatars on their platform. Then, in February, OnlyFans announced that they planned to allow content creators to use NFT profile pics that were minted on Ethereum.
Now, a few months later, Mark Zuckerberg, announced that Instagram will also start to test NFTs on Instagram in an attempt to introduce more people to this new technology and make it more accessible to a broader range of consumers. Similar functionality will also be introduced to Facebook (and possibly other Meta apps like WhatsApp and Facebook Messenger) soon. Plus, Susan Wojcicki, the CEO of YouTube, also suggested that YouTube may help its network of creators to generate money by embracing Web3 technologies and NFTs.
What does this mean for collectors and, more importantly, creators? While not a lot has been announced about this new Instagram functionality, here’s what we know so far.
Your Quick Guide to Instagram NFTs:
The Hype About NFTs
Instagram needs no introduction, but what are NFTs exactly and why all the hype? If you’re already clued up about NFTs, feel free to skip the next paragraph. If not, you might want to read it first.
An NFT is a one-of-a-kind digital asset that’s managed on a blockchain (similar to cryptocurrency). From art to video clips to even tweets, it can basically be anything in digital format. It’s similar to owning a valuable trading card or an original artwork or antique. There might be copies available of a well-known artwork, but the value is in owning the original. When you buy an NFT, you become the owner of it. So, the ability to own something completely unique that can’t be replaced or exchanged with a similar digital asset is one of the main reasons for the hype.
Now, if you’ve been following NFTs and Instagram, you would probably have seen this big reveal coming. At the South by Southwest (SXSW) conference which was held in March, Zuckerberg already strongly suggested during his session, Into the Metaverse: Creators, Commerce and Connection, that they planned to introduce NFTs to Instagram soon. While not a lot of detail was revealed at the time, his plans were already revealed before the “official announcement” in May.
Plus, about a year ago, Instagram hosted its first Creator Week which was a series of invite-only events. This three-day virtual event was created to help creators get more followers and generate more money.
Though, some of the creators who were invited described it as a cheap way to get insight from experts in the NFT industry. One such NFT creator, Sean Williams (a full-time artist who also has an art brand WEIRDWILDWORLD), shared in an interview with Forbes that it felt like Instagram (aka the tech giant) was exploiting expert artists as they had to share their experiences with Instagram’s engineering team.
This feeling was echoed by Sophie Sturdevant, an NFT artist. She shared with Forbes that to her it felt like Instagram was like that friend who only contacted you when they needed help with moving.
While not as many creators might be completely happy about this move, CoinDesk predicts that this move will probably lead to a sudden strong demand and increased visibility for NFTs. Yet, according to Social Media Today, the dominant view among advocates is that it’s still too soon in the process to see mainstream adoption.
And, considering that NFT trading has declined steadily, one can’t help but wonder about Instagram’s timing. As a matter of fact, according to a recent report that appeared in the Wall Street Journal (WSJ), since September 2021 NFT sales have decreased by as much as 92%.
Then, there’s also the decrease in value of well-known NFTs like Jack Dorsey’s first tweet. It originally sold for $2.9 million, making it one of the most well-known NFT sales in recent history. Yet, about a year later, when the buyer/new owner, Sina Estavi, tried to sell it, he didn’t receive any bids higher than $14,000, according to the WSJ.
How Will Instagram NFTs Work?
The head of Instagram, Adam Mosseri, explained that a small group of collectors and creators in the United States will be able to display NFTs in their Instagram Stories and feed as well as via Instagram messaging. It will be called “digital collectibles” and will be displayed similarly to tagged profiles and products. By tapping on the tag, the creator’s name, NFT owner, and other details will be visible.
The goal is to start testing it and learn from their community of users, creators, and collectors. So, that’s the reason why they will start with a small group. Plus, Mosseri acknowledged in his announcement that there’s a tension between Instagram being a centralized platform and NFTs focusing on distributing power and trust. So, by using a smaller group, they hope that they can figure out how to incorporate that principle of distributed trust and power. Then, using this feedback from their initial testing, the platform plans to introduce more functionality later down the line.
At first, NFTs that are minted on Polygon and Ethereum blockchains will be supported. They plan to support Flow and Solana at a later stage. These networks host most of the trading in crypto art.
With regards to third-party crypto wallets, initially Trust Wallet, Rainbow, and MetaMask will be supported and the plan is to introduce Phantom, Coinbase, and Dapper at a later stage. By plugging in their wallet, a user can prove ownership of the NFT, display them on his/her profile, and tag the creator of the digital artwork (depending on their privacy settings). When a collector or creator posts a digital artwork, it will have a shimmer effect and a description of the piece can also be shown.
At this stage, other future plans include finding a way to let people use augmented reality to display 3D NFTs Instagram Stories. Zuckerberg revealed that this feature will be built using Spark AR.
What Will It Cost?
Adam Mosseri shared via a post on Twitter that there will be no fees linked to sharing or posting a digital collectible on their platform.
NFTs on Instagram 🎉
This week we’re beginning to test digital collectibles with a handful of US creators and collectors who will be able to share NFTs on Instagram. There will be no fees associated with posting or sharing a digital collectible on IG.
See you next week! ✌🏼 pic.twitter.com/VuJbMVSBDr
— Adam Mosseri (@mosseri) May 9, 2022
He added that the creator economy is very important to the company. However, at the same time, he acknowledged that at the moment the ways that creators can generate money via Instagram change quickly and are unpredictable. They hope that this introduction of NFTs will help to create another chance for a smaller group of creators. So, this suggests that in the future Instagram users will be able to buy and sell NFTs directly via the platform too. What’s more, according to Engadget, Zuckerberg has also stated that creators may eventually be able to use the app to mint NFTs.
What About Safety?
On their official website, Instagram emphasized that to them it’s key that they keep the platform safe and enjoyable for all their users. To do this, users can use their tools to keep their accounts safe. They can also report NFTs that break their community guidelines.
With regards to sustainability (one of the controversies regarding NFTs), they will buy renewable energy. This way, they can minimize the impact of emissions that are linked with displaying digital artwork.
However, considering that the Instagram account of Bored Ape Yacht Club (BAYC) was hacked recently, security will be a concern among creators and collectors. According to CoinDesk, the hackers promoted a fake distribution of NFTs which deceived users into clicking on a malicious link that gave hackers control of their wallets. The damage was estimated at nearly $3 million. More than 90 NFTs were stolen, which included four Bored Apes and six Mutant Apes. Yuga Labs, the company that created BAYC, stated that two-factor authentication was activated and that security practices were strictly imposed.
Social Media Today added to this concern and commented that they were unsure if it was a good idea for Meta to jump on the NFT bandwagon. This recent hack of BAYC’s Instagram account wasn’t an isolated case. According to Social Media Today, every second day there are reports of millions being lost via hacks and deception. These might not be typical of the whole NFT ecosystem, but as there’s still a lack of legal support and regulation, it’s still something to worry about.
Which Creators Will Be Involved In the Initial Launch?
Safety concerns aside and back to the more interesting details… According to an email sent to TechCrunch by Instagram, the following subset of creators will be included in the first NFTs test:
On Instagram’s website, Maliha Abidi (aka @maliha_z_art) shared that she loved how this new functionality will connect the traditional art community with the Women Rise NFT community. Boss Beauties, a woman-led international initiative that creates opportunities for women and girls, also shared their excitement about this and added that they viewed this launch as a chance to remind women that anything is possible and teach them more about what can be achieved with NFTs and web3.
A Last Few Thoughts
It seems like everyone is trying to join the crypto industry. Even Taco Bell released 25 NFTs in 2021. So, it doesn’t really come as a big surprise that a popular platform like Instagram is going in this direction.
Though, there are a few things to keep in mind. This will be Meta’s second attempt to launch a crypto-related product. You might recall that it planned to launch Diem (formerly called Libra), a permission blockchain-based stablecoin payment system in 2020. Though, this project was abandoned at the beginning of this year after various regulatory obstacles and internal differences of opinion about the direction they should take.
Also, you might remember that TikTok announced that it would have its own NFT drop with some of the top content creators on the platform. In fact, this line-up also included Gary Vaynerchuk (aka Gary Vee). Yet, not everything promised in TikTok’s line-up materialized. So, if the past is anything to go by, so far social networks and NFTs haven’t managed to merge the two industries successfully so far.
Usually, it’s third time lucky. Will Meta and Instagram strike it luckier by turning their second attempt into something successful? What will happen after the testing phase? Will they actually manage to help more creators make more money and, at the same time, turn a wider audience into collectors? Only time will tell. And, as always, we’ll keep you posted.
Frequently Asked Questions
What are NFTs?
NFTs are short for non-fungible tokens. They’re unique digital items that you can’t replace with something else. In other words, they’re similar to something like trading cards that you can’t replace with any other artwork. While they’re similar to Bitcoins and other cryptocurrencies, they’re non-fungible and non-divisible.
Where can creators sell NFTs?
There are several NFT marketplaces where creators can sell their NFTs. Most of these platforms require buyers to have a digital wallet and use cryptocurrencies to pay for the NFTs. Creators can, for example, try OpenSea, Async Art, Foundation, Rarible and Myth Market. OpenSea describes itself as the biggest marketplace for NFTs and has over 700 different projects.
Who are some of the most popular NFT creators?
Not all NFT creators are digital artists. There are also a number of celebrities, brands, and content creators who have had success with NFTs. Here are some of the most popular NFT creators:
- Beeple (aka Mike Winkelmann)
- Larva Labs
- Micah Bowbak (aka Mad Dog Jones)
- Trevor Jones
How do you make an NFT?
It’s not easy to make an NFT. So, you need to make sure that you’re really interested in making and selling NFTs. If you’re ready for the technical challenges and other barriers like transaction fees, here are the steps you need to follow:
- Decide which type of NFT you want to make
- Find an NFT marketplace
- Buy cryptocurrency to fund your crypto wallet
- Create a crypto wallet
- Add cryptocurrency to your wallet
- Connect your wallet to your NFT platform
- Start minting your NFTs
- Market your NFTs
How can you market your NFTs?
There are a number of crypto and NFT marketing agencies that can help you to market your NFTs. Here are some of the top agencies that you can check out:
- Blockchain App Factory
- Viral Nation
- Blockchain PR
- Lunar Strategy
- X10 Agency
Credit: Source link