YouTube joins the "NFT" battle of social media giants

Author: Baize Research Institute

In the past year, the popularity of NFTs has skyrocketed, capturing the attention of individuals, businesses, and organizations across nearly all industries. NFTs are rapidly becoming a phenomenon that the mainstream public wants to participate in.

YouTube Moves Towards NFTs

Yesterday, Susan Wojcicki, CEO of the online video service company YouTube, released the annual letter to creators, sharing that the company has prioritized the creator economy for 2022 and is committed to expanding the "YouTube ecosystem" to help creators leverage emerging technologies, including NFTs.

In the letter, Wojcicki referred to Web3 as the "inspiration source" for YouTube's innovations, writing: "We are also looking to the future and keeping an eye on everything happening in Web3 as a source of inspiration for continued innovation on YouTube. Over the past year, the world of cryptocurrency, NFTs, and even decentralized autonomous organizations (DAOs) has highlighted an opportunity previously unimaginable to strengthen the connection between creators and their fans. We have been focused on expanding the YouTube ecosystem to help creators leverage emerging technologies, including NFTs, while continuing to enhance and elevate the experience for creators and fans on YouTube."

Wojcicki stated that NFTs could be another revenue stream for creators. However, she did not provide further details or a timeline.

Colin Fitzpatrick, CEO of the startup Animal Concerts, which focuses on virtual concerts, described YouTube's potential NFT integration as "a great way for creators to monetize their channels without relying on ad revenue." Fitzpatrick believes, "If YouTube intends to promote NFTs on their platform, their advertising partners may force content creators to monetize. Introducing NFTs could be a way for them to sidestep corporate interests and provide users with alternative ways to generate revenue."

Social Media Giants Embrace NFTs Collectively

Competition in the NFT space is heating up, with social media giants at the forefront.

TikTok

As one of the most popular short video apps globally, TikTok launched its first creator-led NFT series, TikTok Top Moments, back in October last year. This series focuses on influential creators and their popular videos in entertainment, culture, and community, turning their highlights into NFTs for release, with proceeds primarily donated directly to the relevant creators and NFT artists, aiming to provide fans and NFT enthusiasts a way to show support for their favorite creators. The NFT series is released on Ethereum and supported by the Layer 2 scaling solution Immutable X.

Nick Tran, TikTok's global marketing chief, stated: "The creations happening on TikTok help drive culture and spark trends beyond the platform. As the creator economy continues to grow, we are constantly looking for new and differentiated ways to support our creators. Now, fans can own a moment on TikTok that helps shape the internet while also supporting some of their favorite creators. We are excited to see how our community and the NFT community engage with some of the most popular cultural milestones on the internet."

To promote its popularity, TikTok ran a full-page ad in The New York Times. The last line of the ad seems to hint at the company's next steps in rewarding short video creation: "We want to be a platform that is constantly looking for innovative ways to recognize and reward our creators."

Twitter

Going back to September last year, social media giant Twitter first announced its NFT plans. At that time, Twitter stated that verification would allow creators to better showcase their work on Twitter and mentioned that they were exploring this.

Last week, Twitter officially launched this new feature, allowing users to showcase their NFTs. Twitter Blue subscribers on iOS devices can connect their Ethereum-based crypto wallets to their accounts and set their NFTs as profile display pictures. This feature will soon be rolled out to Android users. However, while currently only iOS users can set their NFTs as their profile pictures, everyone on Twitter can see them.

Twitter uses a third-party API to retrieve users' NFT data from the OpenSea marketplace for verification. If there are any issues with a user's NFTs on OpenSea, Twitter will not be able to verify the authenticity of the user's NFTs.

The Twitter Blue subscription service is not yet available globally, which will limit the adoption of NFT profile pictures to the markets where the product is currently launched—namely, the United States, Canada, Australia, and New Zealand.

The company had previously hinted at plans for a more comprehensive adoption of NFTs, as it has become an important topic on the platform. It is foreseeable that Twitter is "positioning itself as a social network for discovery, conversation, and education around NFTs, blockchain, and crypto technology."

This launch follows Twitter expressing interest in "integrating decentralized technologies into the platform," including supporting Bitcoin as a tipping mechanism. The company also attempted to mint its own NFTs last year and distribute them for free to users.

A Twitter spokesperson stated in an interview: "Twitter is where people talk about the things they care about, often where people first encounter cryptocurrency and NFTs. We are now seeing people use NFTs as a form of identity and as a way to join the thriving crypto community."

Meta

As early as August last year, David Marcus, head of Facebook's financial division, indicated that the company was "definitely considering" this, marking a significant hint at Facebook's first foray into the NFT market.

"When you design products that need to be future-facing, it is actually very useful to think of the metaverse as a completely digital environment. When I look at what the metaverse needs, it really is the seamless flow of value, for which we need new infrastructure and interoperability, as you need multiple wallets to participate in a metaverse. And I believe having programmable money and smart contracts on top of blockchain will be transformative for the metaverse. Because if you are a creator, if you are creating NFTs, you might want to rent out your NFTs or sell your NFTs, and you can think of various new business models that are not possible under the current payment infrastructure and smart contracts."

Shortly after Twitter began allowing its iOS users to display NFTs in their profile pictures, Meta also started to embrace the industry.

According to the Financial Times, Meta (formerly Facebook) is discussing the possibility of establishing an NFT marketplace and exploring allowing users to mint and sell NFTs. Additionally, Meta plans to allow users to showcase NFTs on Facebook and Instagram platforms.

However, compared to the earlier pioneers, Meta's efforts have not been smooth, as this move has not gained recognition from NFT artists.

Serwah Attafuah, an Australian artist focused on creating African futurism abstract NFTs, previously had 20,000 followers on Meta's subsidiary Instagram platform. As scams, data privacy issues, and copyright infringements of artworks have become commonplace on Instagram, her interactions on the platform have significantly decreased recently.

Itzel Yard, the world's best-selling female NFT artist, stated that there are imitators everywhere on Instagram: "Someone scraped my Instagram, took all my works from it, posted them on OpenSea, and then they started trying to sell them."

Some NFT experts and artists have expressed cautious attitudes towards Meta's strategy for various reasons.

Melaf Ozal, a blockchain expert and fintech professor at Rutgers Business School, believes that decentralized art sales "do not resonate well with companies like Facebook."

Dan Kelly, co-founder and president of the NFT trading tracking platform Nonfungible, stated that he holds a "cautious skepticism" regarding Meta's entry into the NFT space, but he believes that anything has two sides, and he thinks that Meta's involvement in NFTs could further mainstream the Web3 community and enhance broader public acceptance.

The NFT Wave Continues

Despite the cryptocurrency market having dropped over $500 billion since the beginning of this year, the NFT market seems unaffected.

On January 17, the largest NFT marketplace, OpenSea, reported a record monthly trading volume of $3.5 billion on Ethereum.
In addition to social media giants, celebrities such as Tom Brady, Paris Hilton, Jimmy Fallon, and Post Malone have also joined the NFT wave, with some launching their own NFT platforms and others purchasing top crypto artworks like Bored Apes and CryptoPunks. Furthermore, global auction houses and financial institutions are also flocking in.

Now, with YouTube joining the "NFT" battle alongside TikTok, Twitter, Instagram, and Facebook, the future of digital collectibles is worth looking forward to, and the potential for future development may far exceed our imagination.