I don't think that anyone serious is asking Mastodon to creating NFTs.
What it is being asked of the devs is to separate the technology from the common applications.
NFTs are more than just overpriced JPEGs being sold by scammers, they already work really well to have permissionless domain names and Decentralized Identifiers.
It would be a great weapon against censorship and it could solve the identity portability problem.
@jon @Mastodon not necessarily. In order to have censorship-resistant domain names, you'll have to make changes at some point of the name resolution stack: either get an ICANN-sanctioned top-level domain (hardest, but endgame for ENS and what it wants to do with .eth), or get OS vendors to be able to resolve ENS (hard, but less so), or (easiest) activity-pub servers can extend their implementation of webfinger.
Meaning, Mastodon devs can do if they wanted to.
@jon @Mastodon yes, but forks also bring more fragmentation, which is not what you want in a part of the system that depends on network effects.
Say you start having some instances with ENS domains getting popular. Will Mastodon push to block these instances on the grounds of "crypto is bad and we will not federate with them?"
@jon @Mastodon you wouldn't have to, *if* it was at the application level.
A ENS-enabled Webfinger could just resolve every IP address from any .eth domain by making a CNAME query to the corresponding .eth.link address (which is maintained by the ENS devs)