Snap is exploring ways for creators to showcase NFTs on its platform, the Financial Times reported on Wednesday, joining tech giants Meta, Reddit and Spotify in releasing NFT features amid a down cryptocurrency market.
Snap’s new feature would allow users to create NFTs off-platform and showcase them on Snapchat as augmented reality filters, which the platform’s been known for since 2015.
But it’s not happening yet, as Snap plans to test the feature with a few content creators beginning in late August, according to the Financial Times.
Snap joins several of its peers in early-stage forays into NFTs this summer: Reddit announced a marketplace for NFT avatars on July 7, Facebook launched NFT integrations on June 30, and Instagram and Spotify did similarly in May.
These companies’ NFT product launches come amid a crypto winter and reduced NFT sales, which totaled just over $1 billion in June, down from $12 billion in January.
And it’s all happening against a broader tech downturn, due in part to reduced profit forecasts—Snap’s stock price, for example, fell from $46 per share in January to under $15 now.
“If social networks ever got the memo about crypto’s decline, they have so far refused to acknowledge it,” Casey Newton wrote last week in his tech newsletter Platformer. “Whether out of optimism about the future or in recognition of the considerable sunken costs involved, the companies’ NFT product roadmaps appear to be largely intact.”
NFTs, or non-fungible tokens, grant ownership of a unique digital object. They are entries on a blockchain, the decentralized digital ledger technology on which cryptocurrencies like bitcoin are based. What makes NFTs distinct, though, is in the name: They’re non-fungible, which means they are unique, unquestionably authentic and irreproducible. The first known NFT was minted, or created, in 2014, but the NFT marketplace didn’t take off until last year, when NFT sales brought in $25 billion. TikTok and Twitter were some of the first mainstream social media platforms to explore NFTs. TikTok launched a creator-led NFT collection in September 2021, a rollout that some considered messy and largely unsuccessful. Twitter made NFT-based profile pictures available to paying users in January. These efforts—in addition to the more recent ones from Snap and others—are another tenet of social media companies’ push to compete for the biggest slices of the $100 billion content creator economy.
Because NFTs are hosted on blockchain platforms that require extensive auditing, it takes a lot of energy to make them, which has resulted in widespread criticism of their negative environmental impact. One digital artist calculated that mining a single Ethereum-based NFT used enough energy to power a house in the United States for nearly five days.
What We Don’t Know
How far tech companies will take these early-stage NFT rollouts. Demand is down right now, but with the historically volatile crypto market, it could go up again. Notably, though, Reddit’s announcement of its NFT avatars does not mention the word “NFT” but instead describes them as “blockchain-backed collectibles.”
Last week, James Murray, the former United States Secret Service director, announced that he will retire at the end of July and join Snap as chief security officer.
Snap explores plans to let users showcase NFTs as filters (Financial Times)