Non-fungible tokens (NFTs) have quickly been deployed in the entertainment, media, and sports sectors as the biggest brands, companies, and individuals seek a head start in creating their own digital collections.
They come in a myriad of forms, and just as blockchain technology is touted to meet the needs and problems of every industry, there is no limit to the imagination in developing and running NFTs around the world.
Social media has helped people connect with each other like never before, and these different platforms have played a role in the adoption and diffusion of NFT among different audiences.
However, leading industry giants like Facebook and Twitter have yet to fully integrate blockchain technology into the internal structure of their underlying systems. Users can post about exciting new NFT launches, but end-users cannot buy or trade these items without clicking a link that directs them to a platform on which the digital collection is based.
Facebook in particular has been subjected to heavy regulatory scrutiny in the past two years, as its native crypto and token wallets and the planned global payment system have far-reaching effects on the financial area. With an estimated 2.9 billion user base, the social media giant could transform the way hundreds of millions of people do business with each other every day.
When the Novi wallet and its Diem cryptocurrency were officially launched, the company didn’t forget the popularity of NFT. David Marcus, chief executive of Facebook Financial, confirmed this in August, saying that their Novi wallet is in an important position to help users support NFT.
NFTs are becoming increasingly popular and social media platforms like Facebook are moving fast to keep up with the growing space. What remains is seen as the look of a Facebook-based NFT, and as the company steps into the field, it will be of mutual benefit to the social media giant and the crypto industry.
Integration is inevitable
There seems to be a consensus among industry participants that the integration of NFT and social media platforms is only a matter of time. María Paula Fernandez, Advisor to the Board of Directors of the Golem Network, told Cointelegraph that the event has both positive and negative aspects:
“I’m not comfortable with the idea of Facebook jumping into the NFT, the NFT markets that are largely transaction and profit driven. I would be more concerned about other Web3 apps integrating with Facebook. “
Markus Bopp, trainer and founder of the multipath infrastructure platform NFT Unifty, also commented on the topic, telling Cointelegraph that the growing space could have some interesting use cases for social media platforms.
Going beyond just selling digital collectibles, Bopp believes the functionality of the NFT could provide solutions to some of the problems plaguing various social media platforms, as the identification and verification requirements show:
“An NFT-based system can handle this with very little effort and in combination with profile pictures. However, proof of identity is only a minor option. What NFT is really good at is gamification and value-added ownership. Social media companies will be able to use these powerful tools to explore literally thousands of new opportunities. “
With the integration of NFTs into social media platforms expected to become a reality, the next consideration is whether or not this will have a profound impact on the wider adoption of crypto space and blockchain innovations.
Bopp believes that the reach of the largest social media platforms will be critical to promoting crypto adoption, especially if the functionality becomes seamless: “The user experience for adoption, bulk adoption of cryptocurrencies needs to be at a level that users can use you don’t even need to know to communicate with a blockchain. “
Fernandez offered an alternative when she highlighted the troubles Facebook faced when its plans for Diem, originally branded as Libra, were blocked by multiple regulators. At the time, NFT was widespread: “Facebook tried and failed to incorporate crypto, and anyway crypto, blockchain and NFT went mainstream without them.” “We’re building an industry that Facebook doesn’t need to develop platforms that reach mainstream audiences all over the world, ”she added.
What will the built-in NFTs look like on Facebook?
The Libra Foundation continues its march towards the introduction of the Novi wallet and the Diem cryptocurrency, while preventing the enforcement of extensive regulations in the pound and the euro.
It is not yet clear whether the Diem wallet will include support for the types Bitcoin (BTC) and Ether (ETH). This should allow the company’s own NFT platform to be integrated directly into the Diem blockchain. Interoperability with decentralized tokens such as ETH may not be supported, so that a separate NFT ecosystem must be connected to the Novi wallet.
Bopp has agreed that the Novi crypto wallet and Diem currency will be an important part of supporting NFT as “the introduction at this level will be great for the crypto space,” but there could be some tradeoffs for that Users and different effects for which give wider space:
“Facebook has the ability to bring its own technology into the NFT, as it does with most things. We should expect a compromise on ownership as they try to use the technology for their own user base. This will likely work for them to a large extent, but at the same time it will encourage the discovery of more open and decentralized sources. “
Assuming that the NFTs powered by Facebook are powered by the Novi wallet and the cryptocurrency Diem, Fernandez does not see a centralized ecosystem that measures the similarity of the Ethereum blockchain, which spawns intelligent contract functions are communities, games, customizable smart contracts, that provide NFT properties, an ecosystem built on top of certain NFTs, financial instruments such as fractional ownership, and pools of liquidity. I don’t see Facebook able to top that. “
Cryptocurrency Community Keys to NFT Popularity
The fact that Facebook users can buy an NFT that will appear in their feeds is in some ways because the Novi and Diem launch dates have yet to be set due to ongoing regulatory considerations in various jurisdictions.
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At the same time, decentralized NFT markets are thriving, supported by the communities who built the infrastructure and traded the tokens that power their ecosystems. Fernandez offered a poignant goodbye, telling Cointelegraph that Facebook doesn’t have a community around it that compares to one like Ethereum:
“NFTs are not just cultural assets or collectibles – they are also financial instruments. The Ethereum community has mastered the art of building financial instruments and has now incorporated NFTs into these tools. Facebook can bulk sell JPEGs as much as they want, but there is no competition unless their transaction layer is above Ethereum. “