What is the “metaverse” and how does it work?
WHAT IS METAVERS?
Metaverse, a term first coined in science fiction, is a combination of the prefix “meta”, meaning beyond and “universe.”
It refers to shared virtual worlds where land, buildings, avatars, and even names can be bought and sold, often using cryptocurrency. In these environments, people can walk with friends, visit buildings, purchase goods and services, and attend events.
The concept gained popularity during the pandemic, as foreclosure measures and work-from-home policies pushed more people online for business and pleasure.
The term covers a wide variety of virtual realities, from work tools to games and community platforms.
Most of the new platforms are powered by blockchain technology, using cryptocurrencies and non-fungible tokens (NFTs), making it possible to create, own and monetize a new kind of decentralized digital asset.
WHAT IS BLOCKCHAIN?
A blockchain is a database shared over a network of computers.
Once a recording has been added to the channel, it is very difficult to edit it. To ensure that all copies of the database are the same, the network performs constant checks.
Blockchain has been used to support cyber currencies like bitcoin, but many other possible uses are emerging.
WHAT ARE NON-FUNGIBLE (NFT) TOKENS?
Non-fungible tokens (NFTs) are a new type of virtual asset that has fueled much of the metaverse’s growth.
An NFT represents an intangible digital item such as an image, video, or game item. NFT owners are registered on the blockchain, which allows an NFT to be traded as a replacement for the digital asset that it represents.
The NFT market jumped during the pandemic with $ 2.5 billion in sales for the first half of 2021, down from just $ 13.7 million a year ago.
Some NFT enthusiasts see them as collectibles with intrinsic value due to their cultural significance, while others see them as an investment, speculating on rising prices.
A digital-only artwork “Everydays – The First 5000 Days” by American artist Mike Winkelmann, known as Beeple, sold for almost $ 70 million at Christie’s in March in the very first sale of this type by a large auction house.
WHO ARE THE BIG PLAYERS?
The Metaverse can be broadly broken down into two distinct types of platforms.
The first centers around building a blockchain-based metaverse, using NFT and cryptocurrencies. Platforms like Decentraland and The Sandbox allow people to buy virtual plots of land and build their own environments.
The second group uses the metaverse to refer more generally to virtual worlds, where people can meet for business or pleasure. Facebook Inc announced in July that it was creating a product team to work on the metaverse.
Roblox, Fortnite and Minecraft, gaming platforms where users can compete and collaborate in games as well as create their own, fall into this category.
BUY AND EARN MONEY IN METAVERSE
While many metaverse platforms offer free accounts for people to join, people who buy or trade virtual assets on blockchain-based platforms must use cryptocurrencies.
Several blockchain-based platforms require Ethereum-based crypto tokens, such as MANA for Decentraland and SAND for The Sandbox, to buy and trade virtual assets.
In Decentraland, users can redeem NFT artwork or charge entry to a virtual exhibit or concert. They can also earn money by exchanging land, the prices of which have skyrocketed in recent years.
On Roblox, users can earn money by charging other users for access to the games they create.
THE FUTURE OF METAVERS
It is not known to what extent a true metaverse, which fully replicates real life, is possible or how long it would take to develop.
Many of the blockchain-based metaverse platforms are still developing augmented reality (AR) and virtual reality (VR) technologies that will allow users to fully interact in space.
Accounting and consulting giant PwC predicts that VR and AR technologies will provide a $ 1.5 trillion boost to the global economy by 2030, up from $ 46.5 billion in 2019.
Big tech companies are leaping into the space, with Facebook Inc, Google owned by Alphabet Inc and Microsoft Corp investing in cloud computing and virtual reality companies in anticipation of its growth.