Space left to grow NFT and Web3 content creator communities, but with whose tools?
Meta last week announced plans to end support for NFTs on Facebook and Instagram, less than a year after jumping on the digital asset bandwagon. The move was announced Monday, March 13th, by Meta commerce and fintech lead Stephane Kasriel. Kasriel wrote in a tweet: “We’re winding down digital collectibles (NFTs) for now to focus on other ways to support creators, people, and businesses.”
It hasn’t been easy for the entire crypto sector recently. And it’s no surprise that investors have decidedly soured on both cryptocurrency and crypto-adjacent offerings like NFTs. Considering that Meta intended for NFTs to be an extremely lucrative industry less than a year ago, the warning signs of not wanting to prioritize NFTs might mean a little more than just a shift in focus.
The timing of Meta’s decision to stop expanding into a high-risk yet high-margin industry and a second round of mass layoffs (cutting 10,000 jobs this year) announced on Tuesday, March 14th, couldn’t have been more symbolic. As the tech giant reduces the fat on its metaverse bet, where does that leave the Web3 creator economy as the industry braces for a deep economic downturn?
Meta to integrate technology offerings with the financial industry
NFTs began popping up everywhere in 2021, with some NFTs going for hundreds of thousands or even millions of dollars. Meta first introduced its NFT feature on Instagram and Facebook, allowing select users to showcase their NFTs. The company later doubled down on digital collectibles by adding support tools to its platforms in September 2022, allowing some U.S. users to mint and sell NFTs on the Polygon blockchain.
Although Meta is pausing its focus on NFTs, the company supposedly still plans to work on integrating technology offerings with the financial industry. Stephane Kasriel wrote in a tweet that Meta will “continue investing in fintech tools that people and businesses will need for the future.” Meta hasn’t immediately commented on when it expects to end support for NFTs.
What does TikTok or AI have to do with it?
Stephane Kasriel assured that Meta is still on a mission to help creators connect with their fans, and will pivot its focus onto other products such as Reels for messaging and monetization. Meta will also continue to work with NFT and Web3 content creators who leverage its suite of tools to help them grow their community, shifting its strategy to explore other areas, including decentralized social media platforms.
Competition from TikTok and other social networks, a tough economic climate, and privacy changes Apple made to its iOS operating system, have taken a collective multi-billion-dollar bite out of Meta’s revenue. “Reels” have been to some degree a remedy to lure back lost audiences and advertisers.
Ultimately, digital media files, such as artwork, make up a large portion of NFTs and are in many ways at the core of the metaverse. Now that the murmurs of Zuckerberg abandoning the Metaverse in favor of AI are becoming increasingly audible for all creators to hear, NFTs might be taking a back seat in future plans indefinitely.