Facebook owner Meta moves forward with digital collectibles plan

Facebook parent company Meta is pushing ahead with plans to roll out access to digital collectibles to its 3 billion users despite falling crypto asset prices as the social media group seeks to reinvigorate its growth.

In his first interview for the post, Meta’s new fintech head, Stephane Kasriel, said the company would “in no way” adjust its plans around so-called non-fungible tokens.

The efforts are vital to its goal of building and monetizing an avatar-filled virtual world known as the metaverse over the next decade – but they contrast with the wariness that Google and Apple have shown towards crypto assets.

“The Opportunity [Meta] sees is for the hundreds of millions or billions of people who use our apps today to be able to collect digital collectibles, and for the millions of creators who could potentially create virtual and digital goods to be able to sell them through our platforms ,” Kasriel told the Financial Times.

Mark Zuckerberg’s company has long been more bullish on digital assets than other Silicon Valley giants and wants to use them to bolster its appeal to teens and young adults as it battles Chinese-owned TikTok for users.

Non-fungible tokens use blockchain technology to certify the authenticity and ownership of digital art and goods.

Meta’s bet on NFTs aims to attract creators and influencers to its Facebook and Instagram apps by offering them ways to monetize their art or services in hopes that their fans will then flock to the platforms, Kasriel said.

TikTok has underscored the power of influencers by incubating an army of viral personalities that have helped the group grow its user base faster than Meta, whose $118 billion-a-year advertising-based business model is under threat.

Following its quarterly results in February, shares of Meta fell 25% when the company blamed falling profits and user numbers in part on “increasing competition” from TikTok.

Although Meta does not plan to charge users for creating NFTs, they could be monetized via “fees and/or ads” in the future, according to an internal document reported earlier this year by the FT.

Longer term, Meta hopes NFTs will help fuel his vision for the Metaverse, which he says could generate its own $3 billion economy over the next 10 years. He envisions people using NFTs to create digital goods for their avatars and sell them to each other.

NFT values ​​have plunged in line with a broader rout in crypto assets over the past two months, prompting layoffs among digital exchanges.

Kasriel acknowledged that the blockchain industry has been following a well-worn “hype cycle” – with excitement going from its peak last year to a “pit of despair” as a cryptocurrency bear market s installs and critics question the underlying technology. “There are a lot of things that are not going to survive,” he said.

Meta in May began testing a feature that will allow users to post their NFTs to their social media profiles, first reported by the FT in January. Last month, it announced it was expanding the test to more creators.

Facebook has already been burned in its attempts to establish itself in the freewheeling sector.

Kasriel took over this year from David Marcus, who led Meta’s botched attempt to launch a global cryptocurrency called Diem, which was ultimately scuppered by US regulators.

“We’re trying to understand what the regulatory landscape is so that we don’t invest in things that end up getting super controversial or being shut down,” Kasriel told the Financial Times.

Kasriel, born in Paris, was managing director of freelance platform Upwork and an executive at PayPal, before joining Meta in 2020.

Kasriel said using blockchain will help Meta ensure user trust given the transparent and “immutable” nature of the technology after the company suffered a series of scandals over issues such as privacy and security. competition.

He added: “Technically it doesn’t need to be on a blockchain — we could build an open development platform like we have historically. But do you really trust us? If we change the rules of the game, are you going to blame us?

Over time, the company hopes to make NFTs cheap and easy to buy and trade, Kasriel said, adding that accessing digital collectibles in existing marketplaces is currently expensive and “tends to be designed for crypto.” -conversion”.

The company claimed that the metaverse will not be a walled garden like its current apps, but that users will be able to transfer their digital identity and digital assets from one platform to a rival’s seamlessly – a feature that open-source blockchain technology could make it easier.

Meta is now exploring ways NFTs could be used to sell “memberships” and “subscriptions” to creator content that can be used across platforms, Kasriel said.

He said Meta is proceeding with caution, given the challenges of scaling the use of the most popular blockchains. “It is still very early. Most of these technologies are simply not ready for prime time. . . We make investments, but we are also realistic.

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