Simply put, a metaverse is a space where humans can interact in a shared virtual universe that combines different virtual spaces. The term includes a wide range of virtual realities, including workplace tools to games and community platforms. The term ‘metaverse’ comes from Neal Stephenson’s science fiction novel ‘Snow Crash,’ where humans interact as avatars in 3D space. Another instance could be the film ‘Ready Player One‘, which depicted people entering a virtual world and transforming into a 3D being or avatar. In the movie, players were given opportunities to do things they wouldn’t be able to do in real life, such as performing extreme physical feats or driving technologically advanced vehicles.
Several platforms, like video games, contain metaverse-like characteristics such as in-game events and virtual economies,’ For instance, in the multiplayer game Fortnite, around 12 million players were a part of Travis Scott’s virtual music tour that took place within the game.
Metaverse-like applications based on blockchain are already live and provide people with liveable income. During the pandemic, the virtual metaverse concept in the video gaming industry grew in popularity as lockdown measures and work-from-home policies drove more people online for both business and pleasure.
Axie Infinity is one such game that runs on a play-to-earn concept. Decentraland and SecondLife are other successful examples of gaming cum earning hybrids. Also, NFTs and crypto payments are no longer a use case suited for crypto geeks well-settled in digital assets markets. They have entered the videogame domain and actively form a part of the developing metaverse.
The Significance of the Metaverse
Once active, the metaverse will have virtual 3D spaces to work, play, meet, and socialize together. You would be able to move within the universe and from one universe to the other. In a Metaverse, people would be able to buy and sell land, avatars, buildings, and even names, with the help of cryptocurrencies or native coins.
People would be able to walk around with their friends, visit buildings, buy goods and services, and attend events virtually, with the help of augmented reality.
Even if the metaverse falls short of many people’s high expectations, it can fundamentally alter how we interact with the digital world. A collective virtual experience, similar to non-fungible tokens (NFT), could open up new opportunities for creators, gamers, and artists, by not only just reshaping the creator economy but also inventing it.
The metaverse’s virtual world has the potential to become a trillion-dollar industry as an online world of entertainment, commerce, and in many cases, even employment. The metaverse is being referred to as the internet’s successor rather than an extension of it. It’s being built on top of blockchains and decentralized apps.
Many new demi-metaverse platforms, based on blockchain technology, use Cryptocurrency and non-fungible tokens (NFTs) while allowing for the creation, ownership, and monetization of a new type of decentralized digital asset.
The concept of metaverse can also help with social inequity issues. A person’s geographic location directly impacts their financial opportunities. This idea would no longer hold relevance in a world with parallel metaverses. As technology advances in the realms of virtual and augmented reality, remote work will become more effective and accessible.
In an interview with The Verge, Zuckerberg talked about his vision for the metaverse. He discussed the concept of ‘infinity offices,’ or virtual workspaces. He claims that working in virtual reality allows for more multitasking and that meetings held in a virtual, metaverse-like environment are inherently more collaborative and productive.
The Beeple artwork ‘Everydays’ that sent waves in the digital art world after it sold for a whopping sum will soon be displayed in a virtual world called ‘Souk.’ It soon will become the hub for live events, concerts, and thought leadership discussions once it goes live on November 4.
What Role does Cryptocurrency Play in the Metaverse?
Companies such as Decentraland and The Sandbox currently have virtual worlds that integrate cryptocurrencies, allowing gamers to create and monetize structures such as virtual casinos and theme parks. The currency used in Decentraland is known as MANA. There are even casinos in Decentraland where you can gamble in MANA and where dealers are paid in MANA simply for showing up. The integration of cryptocurrencies in the metaverse universe could bring in many utilities, such as:
- Cryptocurrencies can provide the necessary functions in a moving economy- digital proof of ownership, transfer of value, accessibility, and governance over the financial aspect in the metaverse.
- Being built over a decentralized framework, i.e., blockchain, cryptocurrencies will bring in the virtues associated with it, including, transparency, traceability, immutability, security and also, democratization and disintermediation.
- Cryptocurrencies can be useful in serving metaverse functions such as displaying a secure way of ownership, transferring money around the metaverse, and playing a role in the decision-making happening in the metaverse.
- Blockchain developers are highly influenced by the video game world and have already applied the concept of Gamification in several DeFi and GameFi platforms. In the future, the two worlds of cryptos and metaverse will be even more integrated, given the level of similarities between them.
- Avalanche(AVAX) and Polkadot (DOT) are two cryptocurrency projects that create custom blockchains that can interact with each other. As technology progresses, multiple metaverses will exist, and it will be essential that players or users move smoothly from one universe to another. Blockchain already holds solutions to improve upon the interactive capability of the metaverses.
NFTs will also play a key role in the metaverse, allowing players to fully own their characters, in-game items, and even virtual land. The most expensive sale to date was an NFT of a 259-parcel virtual estate in Decentraland for more than $900,000.
On interoperable marketplaces, gamers and universes will eventually be able to buy and sell virtual goods. Someone could, for example, sell their Decentraland virtual plot of land and use the funds to purchase Fortnite skins. All virtual objects and intangible items could be expressed as NFTs, making cryptocurrencies the sole legal tender in the metaverse.
While no one can say for sure what the metaverse will look like or when it will arrive in its final form, the importance of cryptocurrencies in its development is undeniable. As we watch the development of technologies like virtual reality and how current industry leaders like Facebook are getting involved, advancements in blockchain technology and the cryptocurrency sector will play an equal role in defining the metaverse’s future.