Instagram is Becoming an NFT Marketplace
For many of its participants in 2021, NFTs have since gone dormant. Mainly because there haven’t been many positive stories or exciting new tech relating to NFTs over the past year to reignite the hype and interest in the space.
But as Sahil Lavingia, founder of Gumroad, aptly stated, “Sometimes a bull market, sometimes a bear market, always a builder’s market.” And when on-chain activity and fees are low, now is an especially great time to build in the NFT market.
Reddit recently had a hugely successful NFT drop when no one expected it. But they’re not the only social network making moves. Meta has just made a small step toward becoming a decentralized social media platform.
The Tech
Instagram creators will soon be able to make and sell NFTs directly to fans, both on and off Instagram. Meta has developed a toolkit for creators to create, showcase, and sell NFTs. Buyers can purchase NFTs directly within the Instagram app through in-app purchases (which means Apple will still get its 30% App Store fees). Instagram will not take a cut of creator revenue for now. The feature is currently being tested with a small group in the US.
Meta is using Arweave's web3 platform to archive its creators' digital collectibles. The announcement caused Arweave's AR token to jump more than 60% and boosted its market cap to $838 million. AR is now the third-largest web3 token. Instagram users will be able to issue digital collectibles for their posts and store them on Arweave. Data cannot be altered after it is entered on Arweave.
They are using the Polygon blockchain for NFT minting. Polygon is a Layer 2 scaling solution for the Ethereum blockchain, allowing quicker transactions and smaller gas fees. (What’s a layer 2 blockchain?)
The Use Cases
Given the vast variety of creators and content on Instagram, we will see entirely new types of NFTs – like comedy skits – that may not have found success already on NFT platforms like OpenSea or Magic Eden platform. But not until this feature is available to the public.
For now, they’re giving early access to select creators like DrifterShoots, visual artist Ilse Valfré, and artist Amber Vittoria.
A few of the artists that I’m excited to see using the digital collectibles feature already on Instagram include:
My Take
What I like about Meta integrating NFTs into a platform that many creators already know how to use (and mostly enjoy using, too) is that it puts all the technicalities in the background.
Meta is leaning on their strengths, which is to build world-class tech with user interfaces that are easy to understand. Creators won’t have to learn entirely new platforms and jargon. It’ll probably be as easy and frictionless as posting on Instagram.
In my note on The Next Phase for NFTs, I showcased a creator who sold over 1,000 NFTs without mentioning the word NFT or telling people about digital wallets. He leaned into ease-of-use and found
Taking the complexities out of NFTs is what will get us to a future that I described in The NFT Handbook.
Member discussion