On Instagram made an announcement on March 14, 2023, stating its decision to discontinue its involvement with digital collectibles known as NFTs. Stephane Kasriel, Commerce and FinTech Lead at Meta, shared this information in a Twitter thread, mentioning that the platform would disable features supporting NFTs.
Kasriel stated, “We are reevaluating our priorities to enhance our focus. As of now, we will be winding down digital collectibles (NFTs) to concentrate on alternative methods of supporting creators, individuals, and businesses.” Although Kasriel did not provide any specific reasons for the decision, he affirmed that enabling financial opportunities for creators remained of utmost importance.
When contacted by nft now, representatives from Meta conveyed that they had no further details regarding the rationale beyond what was shared in Kasriel’s tweets. The company also refrained from disclosing a specific timeline for disabling the features. However, representatives assured nft now that dates would be determined in the upcoming weeks.
This news came as a surprise to numerous creators on the platform, particularly since Instagram had recently introduced these features, making the decision unexpected.
Instagram’s NFT timeline
Instagram initiated the testing of its NFT capabilities by partnering with specific creators in May 2022. However, it was not until August of the same year that the majority of users worldwide were introduced to the platform’s NFT integrations across 100 countries.
Initially, these features were limited to showcasing self-created or collected NFTs, lacking essential functionalities such as minting, buying, and selling NFTs among users.
Significant changes occurred in November 2022, just before the new year, when Instagram permitted a select group of creators to sell NFTs on their platform. These artists were optimistic, envisioning this development as a catalyst for a more fair and inclusive creator economy.
Dave Krugman, one of the creators chosen to participate in testing Instagram’s NFT marketplace features, expressed his views on the symbiotic relationship between the NFT community and social media. He stated, “The NFT community would benefit from recognizing our deep interconnection with social platforms. By combining our efforts, we can establish a sustainable system that supports creatives in interconnected online communities,” as reported by nft now.
This significant advancement took place merely four months ago, marking a relatively recent milestone in Instagram’s journey with NFTs.
AN OVERVIEW OF WHAT INSTAGRAM’S NFT INTEGRATIONS LOOK LIKE. CREDIT: META
When asked about Instagram’s future plans to support creators and what would follow after NFTs, representatives from nft now received a response indicating the absence of any product updates to share at that time. However, they highlighted the existing monetization options available to creators as examples of where Instagram is investing in their support. These options include enabling creators to earn directly from Meta, receiving direct support from their fans, and engaging in brand partnerships.
Under further inquiry, the representative mentioned Instagram’s upcoming intention to introduce advertisements to reels later in the year and referenced ongoing projects. Specifically, they mentioned that eligible creators in the United States on Facebook and Instagram can receive gifts on Reels from fans who purchase them directly using Stars. Furthermore, they highlighted the expansion of subscriptions on Instagram to encompass all creators in the United States.
It is important to note that these product offerings primarily benefit creators based in the United States, potentially leaving creators outside the U.S. or those within the U.S. who are ineligible for these programs with limited support options.
The Web3 community responds
When the news surfaced, Krugman swiftly reacted as one of the initial creators. He expressed disappointment, stating, “Such a short-sighted move. The inclusion of digital collectibles holds immense potential for creators to engage their communities and counterbalance the drawbacks of attention-based advertising economies. You guys quit before you even started. It’s a real shame, undoing the remarkable work by talented individuals there.”
On the other hand, Connie Ansaldi, CEO and Founder of Carnaval Art, a blockchain-powered loyalty service for companies, criticized the lack of foresight displayed by the company and accused them of succumbing to fear. She argued, “You’re not thinking in the long run. What if you had bid farewell to the internet when the bubble burst in the 2000s? We wouldn’t have Google or even Meta today.”
Renowned artists like Chris Torres, the creator of Nyan Cat, also ridiculed the company for its poorly conceived and haphazard plan.
However, such abrupt actions from Meta are not entirely unprecedented, particularly in recent months. Meta’s Reality Labs division, which focuses on AR and VR products, incurred a loss of over $13 billion in 2022 alone, leading to cost-cutting measures. In November 2022, the same month when Meta introduced its core NFT features, the company laid off approximately 11,000 employees, marking the largest workforce reduction in its history.
Instagram and Meta have yet to provide a comprehensive explanation for their decision to discontinue NFT features, and it remains unclear whether their financial setbacks played a role in the consideration. Nevertheless, it appears that Meta’s ambitions to dominate the metaverse may not be off to a particularly auspicious start.
