Instagram is one of the largest social media platforms in the world, with around 2 billion monthly active users. Early last year, parent company Meta began testing non-fungible token (NFT) sharing, allowing select users to connect to their digital wallets and view the NFTs they have created or purchased. The feature gained traction as NFT creators and collectors saw future opportunities to showcase their digital assets to a broader audience. Its wide range of applications.
Due to the positive feedback and eagerness to leverage the creator economy, Instagram began slowly expanding its digital collectibles feature, allowing select digital artists to begin minting and selling NFTs directly on the platform. Adding NFT trading to a platform like Instagram makes sense, given the huge global audience. The feature exposes users to Web3 concepts, many of them for the first time, in a way that doesn’t interfere with Instagram’s core business model. Users on
Instagram also pays for NFTs in fiat currency, eliminating an otherwise challenging entry point for newbies to Web3.
— Sandeep | Polygon 💜 Top 3 by impact (@sandeepnailwal) January 9, 2023
Bringing in Web3 builders
While blockchain natives may have been skeptical of Instagram’s foray into Web3, the platform’s partnership with well-known NFT artists has helped build community trust. Drifter Shoots (aka Isaac Wright), Refik Anadol, Amber Vittoria, Dave Krugman, and Micah Johnson have each released NFTs via Instagram over the past few months and have sold out each time. “Digital collectibles make a lot of sense given where a lot of us do our social signage,”
In an Instagram post, Krugman hinted that his first NFT release would happen in November. Other famous NFT artists, such as Maliha Abidi and Bobby Hundreds, have used the platform to showcase their NFT creations and praise the feature as an accessible way to reach potential buyers not just because it brings the NFT conversation to the platform, but because it allows us to reimagine the bright future we see ahead for NFT and Web3,” wrote Adam Bomb Squad, Bobby Hundreds NFT Collection, in a post. Shows one of his signature characters.
The relationship between traditional Web2 businesses looking to use a Web3 toolkit is frequently awkward. Some people view their attempts to publish NFTs or purchase real estate in the metaverse as “PR stunts” that cater to Web3 enthusiasts and are not always well received.
A blueprint for mass adoption
With so much buzz surrounding an image-centric, blockchain-rich social network, Instagram has made sure to showcase digital collectables in a way that feels organic to its core audience and its native audience. from Web3. For example, Instagram users can share NFTs in their feeds like any other image. Still, there’s also a dedicated digital collectibles tab to create a sense of integration and separation of content. The platform chose the Polygon blockchain to first launch its digital collectibles feature, a move that aligns with Layer 2’s stated goal of becoming a “funnel” for Web2 brands that want to jump on Web3. “We built this awesome funnel for partners to make Polygon onboarding really seamless,” said Ryan Wyatt, Polygon’s CEO. He told CoinDesk TV’s “First Mover” last month.
Polygon’s recent partnerships with Nike, Reddit, and Starbucks have been very successful. His holistic approach to brand integrations and focus on making the process easy for Web2 businesses have paid off. According to data from blockchain analytics platform Nansen, the number of repeat buyers per day in Polygon’s NFT ecosystem hit new all-time highs last month. Polygon also made a profit with native Web3 markup, albeit at a cost. One of Solana’s lead NFT projects, Y00ts, recently made the move to Polygon, with Polygon’s parent company DeLabs receiving a $3 million non-equity grant to make this possible.
Nansen data suggests that Polygon has nearly three times the number of daily transactions as Ethereum, seeing 823,000 unique daily active wallet addresses over the past day. However, Polygon’s overall NFT trading volume on the secondary market, where NFT collectors sell their digital collectibles for a profit, pales in comparison to Ethereum NFTs, reflecting the general blockchain’s low-cost approach to onboarding new collectors rather than promoting projects native to Web3.
Some polygon-based projects have also chosen to use the word “digital collectibles” instead of “NFT” in their branding, a move that distances them from the controversies plaguing the crypto market. The term is also considered friendlier to newcomers unfamiliar with cryptography. So far, Instagram’s methodical entry into Web3 has shown promise for other Web2 brands looking to take the plunge. Showing how NFTs and other crypto assets can be used to expand trading offerings provides an accessible entry point for curious Web3 consumers without isolating the Web3 natives who have supported the NFT market all along.