Snap is disbanding its Web3 team amid layoffs

Snapchat’s parent company, Snap Inc., is reportedly shutting down its Web3 ambitions amid recent layoffs that could result in a 20% workforce reduction.

Jake Sheinman, one of the team’s founders, announced the news on Wednesday in a tweet that the company had made the decision to close its team. He also announced that he was leaving the company.

“After ~4 years with Snap, today is my last day,” Sheinman wrote. “As a result of the corporate reorganization, decisions were made to hire our Web3 team. The same team I started last year with other pirates who believed in digital property and the role that that is [augmented reality] can play to support that.”

Snapchat already allows developers to use augmented reality filters on Snapchat, allowing them to add persistent “holograms” to the real world. These AR filters, known as “lenses” on the Snapchat platform, can be used to add all kinds of characters, avatars, and other elements to what users can see through their devices for entertainment.

In July, Snap said it intends to experiment with non-fungible tokens and allow its developers to integrate them into its platform as Lenses. NFTs are a type of crypto-assets based on blockchain technology that represent ownership of digital items such as artwork, music, files, or video game items, allowing them to be bought, sold, and traded.

Web3, also known as the decentralized web, uses blockchain technology to create peer-to-peer apps and token economies where financial transactions take place without intermediaries like banks. NFTs are an application by Web3 that allow people to own ephemeral things like images or AR filters.

Web3 advocates say NFTs could open up a new way for developers to monetize their work, enabling ownership mechanisms that didn’t exist before and attaching contract-based license fees to software when trades and sales between users take place in marketplaces.

In 2021, the NFT market achieved $41 billion in trading volume, despite NFT sales volumes falling by 25% from 10 between Q1 and Q2 of this year after the crypto markets plummeted in 2022 during the “crypto winter”. billion US dollars to 8 billion US dollars.

Although Snap is disbanding its Web3 team, it’s not giving up its interest in augmented reality. In a letter to the Snap community about the reorganization and layoffs, Chief Executive Evan Spiegel identified AR as a priority for the company.

“We are restructuring our business to better focus on our three strategic priorities: community growth, revenue growth and augmented reality,” Spiegel wrote. “Projects that do not directly contribute to these areas will be discontinued or receive significantly reduced investments.”

Snap is disbanding its Web3 team at a time when other social media companies are building their own.

Reddit, the “Front Page of the Internet,” launched a storefront on its social media site in July for limited edition NFT collectible avatars for users to use as profile icons. The customizable avatars, cartoon-like portraits standing in for profile portraits, are NFTs stored on the blockchain that can be traded on marketplaces between users.

Twitter introduced NFT-based profile pictures for Twitter Blue subscribers in January this year, who receive a “soft hexagon” portrait.

Meta, the parent company of Facebook and Instagram, began testing NFT features on Instagram with a pilot program in May and expanded internationally to more than 100 countries in August. Meta Chief Executive Mark Zuckerberg has also been very vocal about his support for NFTs on Meta’s upcoming virtual reality and “Metaverse” platforms.

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