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What is the Metaverse?

1. Why it matters to you2. What is the Metaverse?3. What are the use cases of the Metaverse?4. What do NFTs mean for Metaverse?5. What companies are working on the Metaverse?6. What are the challenges in the Metaverse development?

1. Why it matters to you

Right now, the metaverse is yet to become a reality as it is in its very initial phase, and the current situation is similar to discussions about the Internet in the 1970s. We are currently in the process of creating the building blocks of the 3D immersive environment. But given that we spend most of our time digitally—from work to education and entertainment—it makes sense that Metaverse is coming, but we just don’t know  what it would look like yet.

2. What is the Metaverse?

The buzzword of 2022 is Metaverse, which is a network of 3D virtual worlds focused on social connection.

The hype around the term metaverse started its rise as the tech giant Facebook announced that it was rebranding to “Meta” to align with its long-term vision of building the metaverse. 

But as Matrix star Keanu Reeves said, Facebook didn’t invent the Metaverse—even coin the term. The concept actually goes way back. It’s just that Facebook being a big public company with millions of users has brought the attention of the mainstream audience to this new trend. 

It was author Neal Stephenson who coined the term “metaverse” in his 1992 science fiction novel “Snow Crash,” in which life-like avatars met in virtual reality environments.

Over the years, various developments have been made towards a real metaverse that incorporates augmented reality, virtual reality, 3D avatars, video, and much more. We have already seen this in online game universes such as Second Life, Roblox and Minecraft. However, technology hasn't allowed for the accurate recreation of multi-level worlds which you can immerse yourself into without bugs and lags.

This period could also be interpreted as “the moment in time where our digital life is worth more to us than our physical life,” as stated by Shaan Puri, Senior Director of Product at Twitch

3. What are the use cases of the Metaverse?

The Internet today hosts billions of users looking to access information, communicate with others, as well as sell goods and services. Metaverse is expected to replicate all this value proposition, but with a more immersive experience through the seamless integration of online and offline.  

Experts predict that the metaverse will eventually become an extension of the real-world economy. Individuals and companies will be able to participate in economic activity in terms of building, creating, trading, and investing the same way as we do today. 

This means that the emergence of a new dimension in business—a virtual one—has already started. After all, companies are already buying virtual plots of land and real estate, building virtual offices, virtual collections of goods and services, and working on avatars (and their personal brands) for a reason. Metaverses are not just another hype but a new additional toolkit.

Like the Internet or messengers in their early days, metaverse technologies open up new opportunities and new business practices.

4. What do NFTs mean for Metaverse?

Crypto and NFTs are also play a part in the metaverse world.

NFTs are digital assets representing the ownership of an item. These digital assets contain identifying information in smart contracts, which makes them unique. Being non-fungible and unique means no two NFTs are the same and no NFT can be replaced by another one. 

Because NFTs can be used to prove the ownership of any digital items, authenticity is their most essential feature.

Recently, an NFT-based metaverse real estate company bought a parcel of land on the decentralized virtual real estate platform Decentraland for $2.43 million. Adidas also sold its 30,000 Into the Metaverse NFTs for $23 million, while Instagram is actively exploring NFTs to make them more accessible.

In 2021, NFTs exploded into popularity, with more than $13 billion recorded in sales. So far, over 1.4 million unique wallets have bought or sold an NFT.

This year, we saw artists, musicians, and celebrities capitalizing on the NFT trend. But non-fungible tokens have a much broader potential and we could see their application in copyright and intellectual property rights, ticketing, movies, streaming, financial and medical field video games, software licensing, warranties, and more in the future. 

NFTs, along with crypto assets, make ownership and control decentralized by allowing users and builders to own pieces of internet services by owning tokens.

5. What companies are working on the Metaverse?

A lot of big names have already made significant efforts towards the development of this  new world. 

The tech giant formerly known as Facebook is the most prominent name that is spending billions of dollars to dominate virtual reality. Meta estimates it could take five to ten years before metaverse can really go mainstream, though aspects of it currently exist in the form of persistent online worlds, ultra-fast broadband speeds, and virtual reality headsets such as Oculus.

The next platform and medium will be an even more immersive and embodied internet where you’re in the experience, not just looking at it, and we call this the metaverse,” said Meta CEO Mark Zuckerberg.

Microsoft is another tech giant developing mixed and extended reality (XR) applications with its Microsoft Mesh platform and plans to launch Microsoft Teams in 2022. The US Army is also working with Microsoft on augmented reality Hololens 2 headsets for soldiers to train in.

Epic Games, the developer of Fortnite, is also invested in building the metaverse, starting with photorealistic digital humans.This will be achieved with the MetaHuman Creator where people can customize their digital doppelgangers in future open-world games.

The popular game The Sims, launched in 2000, already allows players to experience a simulated life through virtual avatars.

Online gaming platform Roblox has teamed up with skateboarding shoe company Vans to create a virtual skateboarding plan and opened a limited Gucci Garden, where you can buy clothing and accessories for your virtual self. 

Even the popular dating app Tinder has joined in and is planning its own Tinderverse that will blur the boundaries between offline and online. The company is also testing in-app currency for users to pay for services and receive rewards for good behavior on the app.

6. What are the challenges in the Metaverse development?

Meta company recognized that humanity would exist simultaneously in two spaces: real and virtual. Which one will dominate depends on consumer culture, online habits, and user experience (UX).

This virtual reality won’t be without any challenges in terms of privacy—especially with the entry of big brands and companies like Facebook, along with interoperability and synchronicity with other services and devices.

The next big technology platform attracting social networks, online game makers, and other technology leaders is calculated to be at least an $800 billion market opportunity. This convergence of the physical and digital realms is the next step in the evolution of the internet, presenting yet another opportunity for companies to capitalize on new revenue streams. 

Published: Jan 25, 2022
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