Distribution 3.0: Secondary Markets for Digital Assets on Social Media
No longer confined to connecting people and sharing content, social media platforms are on the path to becoming marketplaces for trading digital assets — not just cryptocurrencies but tokenized assets used in everyday life as well. This convergence of social interaction and digital commerce signals a future where the boundaries between networking, trading, and asset management are increasingly blurred, ushering in an era with Distribution 3.0. For the rest of this article, I will focus on digital tokenized assets that represent time-sensitive assets like event tickets, airline tickets, hotel room bookings, and more. We discuss the possibility and future of how social media platforms are going to evolve into “everything apps,” as envisioned by Elon Musk for Twitter.
Distribution 1.0:
Conventionally hierarchical physical distribution — where physical paper and ledger/journal-based distribution of event tickets and airline tickets was executed.
Distribution 2.0:
The leap towards digital distribution, where inventory was no longer managed on books but on databases. However, it continued to be hierarchical in nature due to the remnants of how conventional businesses used to operate.
Enter Distribution 3.0:
Digital distribution has become the norm in most industries. Secondary markets thrive on the peripheries of standardized practices in the industry, creating what we call dark markets — not necessarily illegal but mostly opaque. Distribution becomes more peer-to-peer, allowing asset owners, event organizers, and airline operators to directly distribute inventory to end-users, consumers, and fans. Blockchain-based solutions also unlock the ability for transparent secondary markets to persist between consumers.
The Evolution of Social Commerce
Social commerce, the integration of social media and e-commerce, has been steadily growing for years. However, with the advent of blockchain technology and digital assets, it has taken a significant leap forward. According to insights from Influencer Marketing Hub, social commerce is projected to become a $3 trillion industry by 2026. This staggering figure underscores not only its monumental growth but also the shifting consumer preference toward integrated shopping experiences within social platforms.
This evolution is characterized by several key trends:
- Integration of Commerce into Social Interactions: Social media platforms are embedding shopping features directly into their interfaces, allowing users to purchase products without leaving the app. TikTok is a prime example of this — with business revenues for 2024 estimated at $17.5 billion, a tenfold increase from 2023.
- Rise of Digital Assets: The popularity of digital assets like NFTs and cryptocurrencies is reshaping how value is exchanged online, with social media serving as a critical conduit for these transactions. Social media platforms like Twitter have undeniably contributed immensely to the growth of the crypto ecosystem. Multiple players like Reddit, Twitter, and Instagram have at various points integrated digital assets into their platforms to engage this captive audience, apart from the benefits that digital assets and NFTs, in general, can offer to social media platforms.
- User Empowerment: Individuals are gaining unprecedented control over how they buy, sell, and interact with digital assets, fostering a more decentralized and user-centric marketplace. With Gen Z starting to contribute to the economy with higher disposable income and uniquely differentiated digital spending patterns, their preferences have evolved as well. Digital ownership and access to assets are no longer a “nice to have” but an expectation.
Instagram: Pioneering Digital Asset Trading
Instagram stood at the forefront of this upcoming change. With the introduction of features like Instagram Checkout, users in select markets can purchase products directly from posts and stories without exiting the app. While initially focused on physical goods, the platform’s infrastructure hints at a natural progression toward digital assets.
The platform has shown interest in NFTs, allowing users to showcase NFT profile pictures and potentially trade digital collectibles. Instagram’s visual-centric nature and massive user base make it an ideal candidate for integrating digital asset marketplaces. This integration could enable artists, creators, and brands to sell NFTs directly to consumers, leveraging Instagram’s seamless user experience. While Instagram launched a digital assets initiative in 2021, much of that seems to have been abandoned. It would be interesting to see what the upcoming crypto wave can trigger for them.
Twitter (Now X): The Vision of an “Everything App”
Twitter, rebranded as X, is envisioning itself as an “everything app,” similar to WeChat in China. This concept involves integrating various services — social networking, payments, shopping, and more — into a single platform. X has already experimented with digital assets by allowing users to display NFTs as profile pictures.
The platform’s move toward comprehensive service integration suggests that digital asset trading could become a significant component of its ecosystem. By incorporating cryptocurrency transactions and NFT marketplaces, X aims to position itself as a central hub in the global digital economy, where users can trade everything as effortlessly as they share updates.
Farcaster: A Web3 Native Social Network
Farcaster represents a new breed of social media platforms built from the ground up on blockchain technology. As a Web3 social network, it inherently integrates digital asset management with its core functionalities. Features like Farcaster Frames allow for native interactions with NFTs, including distribution and verification.
By leveraging blockchain’s decentralized nature, Farcaster ensures transparency, security, and user ownership of data. Social interactions on the platform are intertwined with digital asset trading, making every user engagement potentially transactional. This model exemplifies how future social platforms might operate, where the distinction between social networking and commerce is virtually nonexistent.
How Buk Protocol Is Navigating This Space
At Buk Protocol, we have always been clear that we intend to be a B2B infrastructure that will enable all B2C platforms — whether they are on Web3, Web2, or social media platforms. We are happy to announce Buk Protocol on Farcaster Frames. The web-native social media platform Farcaster introduced Frames, allowing NFT holders and NFT minters to sell and distribute NFTs natively inside the platform, including payment and transferable ownership.
We bring you today the first-of-its-kind initiative to resell and transfer a hotel booking directly inside a social media platform. Natively integrated, a user can transact and purchase a hotel room booking without leaving their favorite social media application. This is our contribution to Distribution 3.0, where time-sensitive assets like tickets and hotel room bookings will be distributed via social media platforms, enabling not only direct access for creators to fans but also mass peer-to-peer transfers.
Full video demo available at: https://youtu.be/rByFwYC9mjs
Warpcast Link: https://warpcast.com/arul/0x2c6343da
The possibilities are immense — imagine a travel influencer bundling her favorite stays into a package as an NFT and selling it to her social media followers right within the social media application, or a Swiftie trying to sell their prized possession event tickets because they cannot attend, right inside Instagram Reels.
Coming soon, we will be launching a similar product where users can purchase and resell bookings inside Twitter natively. Stay tuned at @bukprotocol on all social media.
