Zuckerberg’s Midlife Crisis With Instagram NFTs

Facebook, sorry, Meta CEO Mark Zuckerberg announced yesterday that it will be possible to mint and trade?NFTs?on Instagram in the coming months. It’s Zuckerberg’s attempt to stay relevant to young people and to placate the stock markets, as he is being cornered by TikTok on the one hand and the massive market value of NFT marketplaces like OpenSea on the other.

Engadget?reports?about the?session with Zuckerberg at SXSW:

“We’re working on bringing NFTs to Instagram in the near term,” he said. He didn’t detail exactly how that would take shape, but suggested people would be able to show off their existing NFTs and potentially mint new ones. “I’m not ready to kind of announce exactly what that’s going to be today. But over the next several months, the ability to bring some of your NFTs in, hopefully over time be able to mint things within that environment.”

SXSW has increasingly morphed from the frat party where revolutionary tech talents announce their attack on the ruling powers like the Facebook empire, to a fireside chat where mom and dad dance after Friday afternoon bingo. That can be a lot of fun and uncle Frackers also regularly?organized things?during SXSW. But it was no coincidence that the session with Zuckerberg, who likes to present himself as a great technology visionary, was also open to conference attendees with a film and music badge, with the recommended level of knowledge: “beginner.”

Meta’s biggest moneymaker has always been Facebook, which has gradually become a photo album for us old folks who were born when tv was still black and white. Instagram is also moving in that direction, while WhatsApp remains difficult to monetize. The playful views that Zuckerberg sketches about the Metaverse have already terrified investors: this year FB (short for Meta, cough) has fallen by no less than 43%. That came after Meta estimated revenue figures for 2022 to be?much lower?than the market expected, primarily a result of Apple’s tightened privacy measures. In short, Apple is making it harder for Meta to track and stalk you everywhere online.

In addition, a number of new problems for Zuckerberg have surfaced recently. First of all, it is clear that his weapon in the battle for the youth demographic, Instagram, is completely surpassed by TikTok. Every successful feature of TikTok is?copied by Instagram?while it itself hardly introduces innovations that TikTok adopts. Instagram also turns out to deliver poor conversions for advertisers who want to drive sales, in other words: it’s nice for branding similar to a billboard along a busy highway, but it’s not a marketplace where people conduct in transactions from which Zuckerberg can always collect a percentage.

There is one fast-growing marketplace that generates huge revenues and good margins:?OpenSea, the marketplace for NFTs that was recently valued at?over $13 billion. Zuckerberg has obviously followed the advance of TikTok and OpenSea closely and hopes to kill two birds with one stone with NFTs on Instagram. This wish is not surprising, because the young TikTok users are largely crypto users and the primary target group for NFTs. TikTok is a meeting place for the digital vanguard, as OpenSea is for traders in NFTs.

Zuckerberg’s announcement about NFTs on Instagram is very reminiscent of the?bloated marketing speak?previously spouted about Libra. Remember Libra, Meta’s crypto project that was going to be the Next Big Thing that turned into the Slow Quiet Demise within three years. Because as incredible as it may sound: Libra was conceived three years ago, in 2019, and has already been buried without fanfare.

It’s not to say that Instagram NFTs are bound to fail, just that all the conditions for total failure are there: a poorly converting medium for transactions, an aging audience that comes for something completely different than NFTs, and stronger competitors on the chessboards where it counts: the active youth at TikTok and the NFT traders at OpenSea. We only have to wait for TikTok to do something with NFTs. Perhaps in a partnership with OpenSea, the dream scenario for traders who are short on Meta.

No, the more important crypto and NFT news of the past few days was elsewhere than with Meta. Singapore announced that it would levy income?tax on NFTs, very pragmatically and logically. It indicates how large NFTs already are in South East Asia. And Consensys, maker of tools like Metamask,?raised $450 million?from investors. If Consensys would only use those old school coins to develop user-friendly crypto wallets, then the breakthrough of crypto and NFTs to the general public is near.