With millions of creators and billions of users, Instagram could turn NFTs into a cash cow, the company hopes.
Instagram’s NFT pilot is the first play in a creator monetization strategy that’s still taking shape.
Shortly after unveiling its “Digital Collectibles” product Monday, the Meta-owned social media platform signaled its interest in turning non-fungible tokens (NFTs) into a revenue stream for the creators catering to its billion-plus user base.
Figuring out how to leverage it is to be determined. At launch, Instagram’s NFT pilot will merely allow a handful of creators to share their digital art on the platform – no sales, trading, or fees involved.
Money will ultimately join the mix. In a job posting for Creator Blockchain Experiences on Monday, Instagram called for help to “define the strategy and roadmap for new blockchain-enabled creator monetization experiences.”
Creators could use blockchain tech “to build connections with their fans that are meaningful, monetizable and recognized anywhere,” the job post said. The product manager’s mission will be to help Instagram figure out how.
Jon Victor, who runs Web 3 and NFT strategy for crypto startup Protocol Labs, said that millions of users on Instagram and other social media platforms already sell merchandise and brand partnerships to their followers in the multi-billion dollar creator economy.
Not everyone will want NFTs, Victor cautioned. He cited the mainstream gamer backlash Ubisoft triggered with its botched entrance to NFTs early this year. That might explain why Instagram is limiting its pilot to just a handful of creators and collectors to start.
Getting these creators onboard with NFTs will click with some of their fans: maybe just one or two percent. Given Instagram’s immense size (its user base extends into the billions) that still translates to a massive business proposition for Meta and its creators.
“You’re seeing organic communities form around NFTs,” he said, citing the PFP market as one example. “It makes sense that this idea can be extended to creators that are already building their own communities.”
Instagram declined to comment for this article but directed CoinDesk to recent statements from Meta CEO Mark Zuckerberg promoting the platform’s need to “lean into all the different ways that creators could make money” including via NFTs.
Top brass at Meta have hammered at the ‘creator first’ messaging in recent months with Zuckerberg calling the monetization initiative critical to “set our services apart” in the April recent earnings call.
“One of the challenging things that we need to solve as an industry is how to help creators make a living doing what they love,” said Instagram chief Adam Mosseri in a video announcing the pilot.
Mosseri cautioned that digital collectibles wouldn’t resonate with everyone. But the “subset of creators” who want it could leverage the opportunity in meaningful, monetizable ways, he said.
One such creator, a street artist who goes by Masnah.eth on social media, generates income by painting customers’ larger-than-life “PFP” NFTs on the side of buildings – work he shares on Instagram.
Masnah.eth hesitated to throw himself into Instagram’s visions of an NFT-based creator economy, partly because it’s too early to tell what form the initiative will take. “I gotta read thoroughly!” he said in a twitter message.
Regardless, he said he’s not yet convinced.
“I don’t see why I would” pursue creator monetization on Instagram, said Masnah.eth, who already sells the rights to future street commissions as NFTs. “Doesn’t really make sense to me.”