It was 2022 when we first heard Zuckerberg’s pitch: imagine a Metaverse where you can walk through your own digital art gallery, populated with the NFTs you know and love.
Now, less than a year later, Meta has reportedly dropped NFTs from Instagram and Facebook. Meta’s decision (along with numerous celebrities now facing lawsuits for promoting crypto and NFTs alike) could be the final sign that NFTs aren’t ever going to make it mainstream, as the media-giant would have been a far more accessible way for non-cryptocurrency experts to take part in the trend.
Meta joined the NFT craze late last year by allowing users to connect their digital wallets to their accounts and share their NFTs publicly. Their goal was ambitious: let users create and sell their NFTs—and eventually display them in the Metaverse—all without leaving the app. It signaled the start of NFTs becoming more public, more fun, and more understandable.
Now, this might just be the final nail on the coffin for non-fungible tokens.
So what changed?
The usual challenges for Meta, of course, played a role. From layoffs and issues getting into cryptocurrency to other legal troubles, Meta decided to refocus its efforts back into the Metaverse—leaving no more room for NFTs.
But, there are much bigger reasons that could have led to Meta abandoning ship (or perhaps more accurately, the bored-ape yacht).
In 2021, NFTs were the new future for cryptocurrency and collectable art online. Collectibles sold for millions of dollars; in December 2021, one piece sold for $91.8 million.
But as early as 2022, the hype began to fade, with NonFungible.com recording their first quarterly loss in Q3 2022. They found there were more sellers than buyers, with only 4% of the U.S. population actually owning a NFT.
Despite this, businesses are still creating NFTs to take part in the action, and we are still seeing announcements for new NFT sales. But will it last?
Even now, 70% of Americans still don’t know what a NFT is (clearly they haven’t read ChatterBlast’s blog covering it more extensively). With prices dropping for sales and fewer active wallets taking part in NFT trading, it looks like the hype is ending. Even searches for NFTs have plummeted over the past year, with the U.S. coming in at #40 for customers’ search interest in the term “NFT” as of November 2022.
Like everything, there’s pros and cons in seeing the NFT world slowly shrivel up.
If you’re still a faithful believer in the concept, NFTs are dropping in price, meaning ownership is easier for the general public at the moment. Investing now when prices are down could help an NFT owner accrue more assets to sell off for more down the line. It’s also the easiest time to create NFTs, with AI-powered art tools popping up everywhere (though you might make an enemy of our graphic & motion designer if you take that route).
The cons are that pay-off may be a long time coming, if ever, and with the AI tools making them easier to produce, we could end up seeing a flood of NFTs with lower value over time.
Conclusion: with interest dropping and with one of the largest social platforms exiting the market, it looks like the time to invest in NFTs is over—at least for now.
We’ll have to watch and see if NFTs make it through 2023, but one thing is for sure: the Metaverse is going to have a lot fewer apes running around.