The Metaverse explained

Region: Europe
Jan 14, 2022, 11:00:00 AM Published By Wirex Team

Have you heard of the Metaverse?

We’d be surprised if you haven’t. After all, alongside non-fungible tokens (NFTs), the Metaverse took off in 2021, even being hailed as the “the future of the internet.”

Some see it as the “next best thing”; others, as simply a fad or some bizarre sci-fi hype.

Regardless, the Metaverse continues to make headlines, with major companies like Facebook, Microsoft and Square Enix all getting on board.

If you’re not familiar with the Metaverse, let us break it down for you.

What is the Metaverse?

While the Metaverse has been a hot topic in recent times, the term actually dates back to 1992 and originates from Neal Stephenson’s science fiction novel, Snow Crash. The story depicts lifelike avatars who communicate with each other in various virtual reality environments.

The concept of a virtual world isn’t new, as they have existed in the form of online games for years – remember World of Warcraft and Second Life? The Metaverse takes this a step further by combining aspects of multiple technologies, such as virtual reality (VR), augmented reality (AR) and artificial intelligence (AI), in which users can interact in a virtual world.

The Metaverse also translates into a digital economy, allowing users to create, buy and sell virtual goods. Decentraland is a prime example of this, as it offers users a 3D world that allows them to buy digital plots of land with its native MANA cryptocurrency.

How is it beneficial and what are its use cases?

  • It creates new marketing opportunities – through their avatars, users can shop, socialise and take part in leisure activities in the Metaverse. Many brands have already taken advantage of this by placing ads that mimic real life and blend into gameplay, such as virtual billboard ads or branded clothing appearing in-game.
  • It can be used as a virtual office space – remote working has increased in recent years, particularly following the Covid-19 pandemic. While tools such as Zoom, Microsoft Teams and Skype offer adequate tools to communicate with colleagues, the Metaverse takes this a step further by offering a virtual space that makes it feel as though everyone is in the same room together. Universities and their students can also use the Metaverse for virtual learning spaces, in which a student’s avatar can navigate between spaces, such as moving from one class to another.
  • It enables virtual world tours – this is where the VR and AR aspects of the Metaverse come into play, as they allow users to experience travel without being there physically. Both can create an engaging virtual world with realistic content, letting users enjoy a location through a first-person experience, much like if they were actually there.

How will crypto play a part in its ecosystem?

How does cryptocurrency come into the picture?

The truth is, crypto is a key element in the Metaverse and is needed to operate it safety and security. If multiple transactions are being carried out in a virtual space, users require assurance that their information is secure. This is where blockchain technology comes in, as it is immutable and is able to secure these transactions through cryptography.

Transactions will also need to be executed and completed quickly, which blockchain can also provide. For instance, the NANO cryptocurrency offers a median transaction time of less than one second.

Haim Isreal, the global head of thematic strategy at the Bank of America, described the Metaverse as a “massive opportunity” for blockchain and claimed that it will result in mainstream adoption of cryptocurrency transactions. However, he also commented that tokens such as Bitcoin (BTC) and Ethereum (ETH) would likely be too volatile, and that stablecoins (e.g. Tether, USD Coin and DAI) are more likely to succeed.

Which companies are bringing the Metaverse to life?

We already know that corporate giants like Facebook (who recently announced that they were rebranding to “Meta”) are fully engrossed in the Metaverse. The multi-billion company released its Horizon Worlds Metaverse in December 2021, in which players can explore the virtual plaza and play various minigames through a VR Oculus headset.

But Facebook wasn’t the first to create its own Metaverse. Decentraland was first launched in August 2017 and has since surged in popularity, with approximately 300k monthly activate users. It’s also been ranked the 2nd largest crypto game behind Axie Infinity. Its native MANA token has seen a tremendous increase in value, starting at $0.08 per token at the beginning of 2021, before skyrocketing to $5 in just over 11 months.

The Sandbox mobile game also launched its “Enter the Metaverse” campaign in November 2021, before officially going live the following month. The purpose of the campaign was to promote the SAND cryptocurrency and give new players the chance to win up to 10 tokens by participating. Like Decentraland’s MANA token, SAND is used as the basis of all transactions within The Sandbox Metaverse. In terms of gameplay, The Sandbox combines blockchain, DeFi and NFTs to allow users to create and customise games and digital assets.

What does the future hold for the Metaverse?

The Metaverse promises to be more immersive, interactive and collaborative than what the internet has been able to achieve so far. CEO of vEmpire, Dominic Ryder, commented that the Metaverse will be the next natural progression for digital interaction, and that the Covid-19 pandemic has pushed this progression even further forward.

“I believe that the pandemic has put this progression in overdrive, as almost everyone used to working in the office has been obliged to adapt to working remotely and digitally,” says Ryder. “It is only a matter of time before those people begin spending more of their time outside of work inside the Metaverse”.

While the Metaverse is still an emerging space, many believe that it will truly shape the future of the internet. Several crypto projects and big companies have already got the ball rolling with their own Metaverse virtual worlds, and with the growing popularity of DeFi, NFTs and many new innovative technologies, we could well see the Metaverse integrated into our everyday lives before long.