A growing category of social media users now prefers using cartoons rather than their own photos to identify themselves online. They especially like cartoons that are as unique as their real faces.
Non-fungible token (NFT) technology makes it easy for a person to know they are the only person who owns such an image. The kind of NFTs that work best here are ones that have picked up their own bit of jargon: PFP NFTs, where PFP stands for “profile picture.”
Much to everyone’s surprise, the micro-blogging site Twitter has all of a sudden announced that it will embrace the trend and give PFP NFT users on the site a way to show that they have proven they really own the NFT in their avatar. So what will that mean for the digital collectible industry?
Lovingly Filtered Faces
It might look like Twitter is just following where users are leading it. For anyone on crypto-Twitter, such NFTs have taken over the timeline. Where once there were lovingly filtered faces, today folks love to show off their fanciest non-fungible token (NFT) as their profile picture. For example, many prominent Ethereum backers (such as DCInvestor, David Hoffman of Bankless, and Snowfro of Artblocks) have the original NFT: CryptoPunks.
But because Web2 giants have been wary about all things blockchain, no one really expected a company as big as Twitter to embrace Web3’s approach to profile pics. Then, Jack Dorsey’s social media company announced that it was testing a tool for loading an NFT onto a profile and allowing the user to show that they had proven — with a crypto wallet — that they really owned that digital object. And on Wednesday a member of Twitter’s marketing team showed a preview video of how it’s likely to work.
From what’s shown, it looks easy. It seems like this is really happening, which should dramatically increase the visibility of NFTs on the normie internet, potentially with market moving consequences.
For Electric Capital‘s Maria Shen, it just means that Twitter was the first to act on the inevitable. “Compared to other social media giants, Twitter has always been more ahead of the curve when it comes to crypto,” Shen told The Defiant. “However, it doesn’t matter whether or not web 2 companies want to learn about crypto, NFTs, and Web3. As more users leverage crypto, they will go where the users go and we will see more companies adopt crypto features.”
As more Web2 companies follow Twitter and integrate such NFTs, more of their users will start to understand crypto and Web3. Those users will inevitably want a crypto native social network, Shen and others told The Defiant, and many are on the way.
Alex Gausman, founder NFTX, which sits at the intersection of digital items and decentralized finance, also felt as though he had seen this movie before.
He told The Defiant, “We saw a lot of this kind of news in 2017 with cryptocurrencies (coffee shops accepting bitcoin, etc.) and it’s all pretty ‘meh,’ but it’s still cool to see Web2 world trying to play catch up. Definitely one step closer to iOS having built-in Ethereum wallets, which in many ways is the final boss, I think,” Gausman wrote
So PFPs are very simple. They are just images that have the right aspect ratio to fit nicely in a little circle on the internet, usually depicting some kind of face (seldom human) and sport features proportionally big enough to remain legible in a few pixels worth of screen real estate.
Maya Bakhai, with the pre-launch seed fund, Spice Cap, told the Defiant, “PFP NFTs are the least creative in my opinion — but it’s leveraging social clout to bring overall NFT adoption to the masses.”
The Forgotten Runes Wizards Cult is an NFT series where each one is a unique picture of a wizard. It works well for the PFP application, if magic and fantasy is your thing. Dotta, one of its co-creators, explained that the risk of social activity impacting real life explains why people are going anon online. Still, the anons need a unique face when they do so. NFTs let them ensure true uniqueness.
“Similar to how Facebook (share everything) gave rise to Snapchat (everything disappears), NFT-based profile pictures let you own your identity without real-world reputational risk,” Dotta told The Defiant.
PFP NFTs started to become very hot this summer with the Bored Ape Yacht Club phenomenon, but it’s never stopped. Every day it seems there are drops of new series of NFTs that work well in profiles. Occasionally one of them seizes the imagination of crypto fans, sending prices soaring and leaving users scrambling to get one for a profile pic.
Will this be good for NFT makers or is it the top signal to end all top signals?
It may at least be good for Twitter. Its NFT push suggests that the social media giant, which has 206 million monetizable active users, sees this crypto innovation as a way to show leadership in big tech. More than one source agreed: Twitter was first here (at least in big tech), but it won’t be the last, but others are optimistic about the boost it will give to NFT makers.
“I believe that it might be one of the biggest events in NFT to date,” said the anonymous founder of Hashmasks, a popular procedurally generated NFT project that sold more than 15,000 NFTs for around $16M in ETH over a weekend in February.
Find Your Cult
“So many people ask this question: ‘Why do you even buy an NFT when you can just download the JPEG?’ I believe the main purpose of an NFT is to flex and to brag and to show people you have something cool,” he said.
The stratospheric prices for some NFTs has been all that mainstream commentators have discussed so far, and while yes, it’s about the money, NFTs are also about much more.
NFTs are about making friends. So Twitter’s move might make it easier for people to make friends online. Who doesn’t need friends?
Marguerite deCourcelle, CEO of the NFT-powered roleplaying game Neon District agreed that authentication will be good for bragging rights. But she also told The Defiant that the flexing has a function, too.
“User-owned assets that are verified by the centralized platforms means that decentralized identities can be recognized across numerous types of platforms for identity purposes simultaneously,” she said. “The NFT one chooses to flex with helps like-minded people find each other more easily, as NFTs can signal allegiance to certain digital tribes.
Dotta explained how flexing one’s wizard helps the Forgotten Runes’ community find each other across the web. Wizard owners look for wizards avatars when they join new platforms because they know people flexing a wizard are probably into the same kinds of art and games as they are. “Wizards follow wizards,” Dotta told The Defiant.
But the cheapest wizard sells for about 0.44 ETH (a bit over $1200 right now), as of around 4 PM New York time Wednesday. Newcomers will probably be looking for a series with a floor price that’s more like 0.04 ETH, which is likely good news for a lot of projects that haven’t clicked with the crypto elite yet.
Bakhai foresees a price bump coming more for the second tier NFTs. “Newcomers who feel priced out by the popular avatar projects can finally create a community around a cheaper/newer project,” she wrote in an email, while the high floor price of the blue chip NFTs give these new groups something to aspire to.
And even though folks will be looking for cheaper entry points, they can still hope for price appreciation as Twitter’s eventual user-interface update attracts more people into crypto, and spurs demand.
In Twitter’s preview video, an engineer shows how to swap her profile picture from a photo to an NFT. After she does so, it shows a little Ethereum symbol at the lower edge of her avatar. This is presumably meant to indicate that its ownership has been verified with a crypto wallet.
Other Twitter users are going to start seeing those little badges and wondering what they mean. Andrew Steinwold, a digital collectible podcaster and NFT investor with Sfermion, told The Defiant that this is likely to bring more people onto the market for an NFT they can use to get the same badge.
“I think this will attract a lot of Twitter users just based on pure curiosity,” Steinwold said.