New collections from Micah Johnson, Drifter Shoots and more sell out

Instagram is one of the largest social media platforms in the world, with around 2 billion monthly active users. Early last year, parent company Meta Platforms began testing non-fungible token (NFT) sharing, allowing select users to connect to their digital wallets and display NFTs they’ve either created or purchased.

The feature gained traction as NFT creators and collectors saw future opportunities to present their digital assets to a wider audience of Web3-curious consumers. Some even suggested that Instagram’s planned support could help NFTs finally reach mainstream adoption due to its expansive reach.

Encouraged by positive feedback and eager to embrace the creator economy, Instagram slowly began expanding its Digital Collectibles feature, allowing select digital artists to begin creating and selling NFTs directly on the platform.

The addition of NFT trading for a platform like Instagram makes sense considering the huge global audience. The feature exposes users to Web3 concepts, many for the first time, in a way that doesn’t add friction to Instagram’s core business model. Users on Instagram also pay for NFTs in fiat currency, eliminating an otherwise challenging on-ramp for Web3 newcomers.

But attracting a Web3-native audience presents several challenges. Would experienced NFT collectors be interested in buying assets sold on a highly centralized, Web2 platform? In addition, Instagram in-app purchases are subject to high fees of between 15% and 30% from Apple and Google, resulting in less profit for sellers.

Despite this, early NFT sales on the platform have been a success, with collections are sold out quickly. Instagram’s strategy of recruiting famous NFT artists to present the new feature has worked in two ways – it lured NFT collectors and helped bridge the gap between Web2 and Web3 users.

While blockchain natives may have been skeptical of Instagram’s foray into Web3, the platform’s partnerships with well-known NFT artists have helped build trust across communities. Drifter Shoots (aka Isaac Wright), Refik Anadol, Amber Vittoria, Dave Krugman, and Micah Johnson have each launched NFTs through Instagram over the past few months, selling out each time.

“Digital collectibles make a lot of sense when you consider how many of us do our social signaling,” Krugman wrote in an Instagram post teasing his first NFT release in November.

Other popular NFT artists, such as Maliha Abidi and Bobby Hundreds, have used the platform to showcase their NFT creations, praising the feature as an accessible way to reach potential buyers.

“We are excited to usher in the feature, not only because it brings the conversation of NFTs to the platform, but because it gives us the chance to reframe the bright future we see ahead of us for NFTs and Web3,” Adam Bomb Squad, Bobby Hundreds’ NFT collection, wrote in a post showing off one of his signature characters.

It is often a difficult situation when traditional Web2 companies want to use a Web3 toolset. Their efforts to release NFTs or buy land in the metaverse are sometimes seen as “PR stunts” aimed at Web3 enthusiasts, and are not always well received.

With so much hype surrounding an image-first social network that embraces blockchain art, Instagram has made sure to introduce digital collectibles in ways that feel organic to mainstream audiences and Web3 natives alike. For example, Instagram users can share NFTs in their feed as they would any other image, but there is also a dedicated tab for digital collectibles to create both a sense of integration and separation of content.

Reflecting this, the platform chose the Polygon blockchain to launch its Digital Collectibles feature, a move that aligns with the layer 2 blockchain company’s stated goal of becoming a “funnel” for Web2 brands looking to jump into Web3.

“We’ve built this great funnel for partners to come through and make the onboarding to Polygon really seamless,” Polygon CEO Ryan Wyatt told CoinDesk TV’s “First Mover” last month.

Polygon’s recent partnerships with Nike, Reddit and Starbucks have all been very successful. Its holistic approach to brand integrations and focus on facilitating the process for Web2 companies has paid off. According to data from blockchain analytics platform Nansen, first-time and returning buyers per day in Polygon’s NFT ecosystem reached new all-time highs last month.

Polygon has also logged gains with Web3-native brands—albeit at a cost. One of Solana’s top NFT projects, Y00ts, recently switched to Polygon, with parent company DeLabs receiving a $3 million non-equity grant from Polygon to make it happen.

Nansen data suggests that Polygon records nearly triple the number of daily transactions compared to Ethereum, logging 823,000 unique active daily wallet addresses in the last day. However, the overall trading volume of Polygon NFTs on the secondary market, where seasoned NFT collectors go to flip their digital collectibles for profit, pales in comparison to Ethereum NFTs, reflecting the low-cost blockchain’s overall focus on bringing in new collectors versus promoting projects for Web3 natives.

Some polygon-based projects have also chosen to use the word “digital collectibles” instead of “NFTs” in their branding, a move that distances them from the controversies plaguing the crypto market. The term is seen as more friendly to newcomers unfamiliar with crypto jargon.

So far, Instagram’s methodical entry into Web3 has shown promise for other Web2 brands looking to take the plunge. It highlights how NFTs and other cryptoassets can be used to expand business offerings and provide an accessible entry point for Web3-curious consumers without isolating Web3 natives who have supported the NFT market all along.