Amid various rug pulls, scams and other nefarious activity, it seems like some of the air has been deflated from the NFT hype bubble, as more people look to take a step back from ‘investing’ in digital art images.
But even so, many still see NFTs as the future, with the pervading view among lawyers being that we’re simply too early in the process to expect mainstream adoption just yet. Current investors are ahead of the game, and everyone will soon be buying and selling digital items. That’s how it’s being pitched from one vantage point – and while it seems inevitable that we will soon see increased trading of digital items, whether those virtual goods are the equivalent of modern Garbage Pail kids remains to be seen.
But like them or not, NFTs are set to get another boost, with a new report from The Financial Times suggesting that Meta is about to unveil its NFT trading and display plans.
As for FT:
“According to one memo shared internally last week, Meta plans to launch a pilot for posting and sharing NFTs on Facebook in mid-May. This will be “quickly followed” by testing of a feature that will allow membership of Facebook groups based on NFT ownership and another for minting – a term for creating – NFTs. NFTs may be monetized through “fees and / or ads” in the future, according to another internal document. Facebook declined to comment. ”
So Meta is seemingly close to establishing its own NFT ecosystem, which follows Twitter’s move to incorporate NFT profile pictures, with a new, integrated display format now available to paying Twitter Blue subscribers.
It seems that Facebook will be looking to facilitate dedicated NFT communities, and become more of a home destination for certain holders and their discussions. Right now, most NFT communities are hosted on Discord, where whitelisting and other elements take place. But maybe, Facebook can become the new home base for such, and ideally take some of that engagement back to its apps, with more dedicated, integrated NFT discussion and community features, which, aligned with Facebook’s scale, could be an attractive lure for NFT projects.
Though I’m not sure it’s a great idea for Meta to get more involved in the NFT trend, given the aforementioned scams and questionable activity in the space. Every other day there are reports of millions of dollars being lost through hacks and deception, and while that’s not a representative of the entire NFT ecosystem, it is still a concerning element, especially given the lack of regulation and / or legal recourse available to victims.
Still, maybe Meta’s also looking to the future, where NFTs will form the backbone of a new digital goods economy.
Meta’s ultimate aim is to encourage eCommerce within the metaverse, its fantastic dream realm where anything is possible, and nothing bad ever happens that might come back to haunt Zuckerberg and his team. In that scenario, there is a view that NFTs will become tradeable assets – and not just profile pictures, but also avatar clothing, digital products from brands, weapons for games, virtual credits, etc. All of these things could essentially be backed by digital contracts stored on the Blockchain, similar to NFTs.
That definitely has potential, and is what many people are missing in the broader NFT picture. The crappy cartoons might have you confused as to why anyone would pay for such rubbish, let alone hand over thousands, even millions of dollars in some cases. But the underlying principle of buying and selling digital goods does indeed have merit, and perhaps, Meta’s looking to further align with that aspect, as opposed to facilitating scammy art trades.
Which also links into another element of FTs report:
“Facebook’s financial arm, Meta Financial Technologies, has been exploring the creation of a virtual currency for the metaverse, which employees internally have dubbed “Zuck Bucks”, according to several people familiar with the efforts. […] According to the company memos and people close to the plans, Meta is also looking into the creation of so-called “social tokens” or “reputation tokens”, which could be issued as rewards for meaningful contributions in Facebook groups, for example. ”
So expanding on digital transactions, Meta’s also considering how it can facilitate in-app transactions with its own, internal digital currency, which wouldn’t have real-world value, as such, but would allow users to buy up virtual items for their digital selves.
Roblox and Fortnite have similar systems, with kids going crazy for ‘Robux’ and ‘V-Bucks’ to buy character skins, weapon variants, dance moves, etc.
Creating an in-app economy lessens the risk of misuse, as the currency cannot be used outside the app – so while Meta has also been exploring its own cryptocurrency with its New project, building an internal trading mechanism will likely see less regulatory pushback, as it won’t be Meta creating an alternative financial process, as such, but one that’s reliant on the current banking systems.
It all feeds into Meta’s grand vision of an all-encompassing metaverse space, where you can buy, sell and trade digital items to enhance your experience.
So while NFTs do have potential for visual art – and it’s worth noting that Instagram is also exploring this element – it’s the expansion of that process that’s likely Meta’s key focus.
Expect to hear more on this soon.