The metaverse refers to online 3D spaces where users work, meet, play, and socialise together. Multiple aspects of life are brought together into the online world and open the doors to new social and gaming experiences. The metaverse can be seen as the forefront of the Web 3.0 internet evolution, blurring the line between digital and reality.
The metaverse as a digital universe will combine all aspects of life in one place and will change the internet we know today. It has the potential to transform our social interactions and afford new digital economic opportunities to users around the world.
While the metaverse is still emerging, the widest available metaverse experiences currently on offer are video games. Play-to-earn games, in particular, are examples of successfully mixing the blockchain world and virtual reality apps. These games have exploded in numbers this year led by the growth of Axie Infinity, a game inspired by Pokemon which uses NFT tokens. The game rewards players economically for their contributions to the ecosystem and this earned income can be directly used in the metaverse.
Decentraland, another famous Ethereum-based metaverse world, combines social elements with cryptocurrencies, NFTs, and virtual real estate. Using the native token MANA, players can purchase outfits, virtual scenes, or even parcels of land, a.k.a. LAND, a 16x16 meter land parcel. The combination of all of these creates a complex crypto-economy. Other games like SomniumSpace, Cryptovoxels, and Sandbox are also promising interesting virtual worlds. In Sandbox, the metaverse token SAND allows users to create a virtual world driven by NFTs. The emphasis on 3D virtual reality can be coupled with a diverse offer of services, such as virtual events like concerts and meetups. The game Fornite brought together 12.3 million players in Travis Scott's virtual in-game music tour in April 2020, in the middle of a worldwide lockdown no doubt but this still remains an impressive figure.
Cryptos and blockchain elements are fully incorporated in metaverse platforms: they support buying, ownership, transfer of value, governance and accessibility of digital worlds in a decentralised and transparent way. The blockchain technology is at the heart of the metaverse.
Crypto and NFTs are used to exchange value and as proof of true ownership. However, in-game currencies in multiplayer games are less secure than crypto on a blockchain. If users spend large amounts of time in the metaverse and earn money there, they will need a reliable currency to transfer and store value. Creating a wallet is open to anyone around the world on public blockchains and makes it a very accessible way to manage finances and digital identity. NFTs allow for the creation of unique objects that cannot be copied or forged and are set as true digital ownership of game assets.
The ability to participate in the rules of the metaverse is very important for users and, here again we see the use of tokens (DAO tokens more specifically) and how they permit a fair governance and a community-owned virtual world. Blockchain technology is also continuously improving compatibility between different platforms. Projects like Polkadot (DOT) or Avalanche (AVAX) allow for creating custom blockchains that can interact with each other. A single metaverse will need to connect multiple projects and blockchain technology already has solutions for this.
The potential of this internet evolution has started to attract Web 2.0 companies like Facebook, which is shifting to a metaverse company and is changing its name to “Meta”. Facebook co-founder and CEO Mark Zuckerberg announced in June 2021 that the social media giant is on a path to become “a metaverse company” and will spend $10 billion this year on metaverse-related initiatives and partnerships. At this inflection point, other leading Web 2.0 tech companies will likely need to start exploring the Metaverse to stay competitive, and the spotlight has prompted a new wave of investment in this emerging crypto category.
In conclusion, although gaming is one of the most immediately addressable segments already starting to naturally shift to Web 3.0, the metaverse opportunity extends far beyond gaming across advertising, social commerce, digital events, offices, and even homes.
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