There are two emerging metaverses. The real metaverse based on Web3 technologies such as blockchains. Second, the dystopic metaverse being built by Big Tech, which extends everything going wrong with the original “Web.” The second is much more immersive but also more intrusive—lacking digital property rights.
The metaverses’ goal is to include as many people as possible through virtual worlds where gaming converges with VR and AR. The metaverse is a collection of ideas, hopes, and fears about the future. It’s a framework that makes sense, showing the direction we are hurling toward.
A single game or social media platform cannot be “The Metaverse.” It can only connect to something larger than itself that interacts with other verses, particularly on an economic level, making the immersiveness and ubiquity of technologies like AR and VR possible.
A permissionless system like the crypto world remains the secondary goal. However, the problem here is that, if confronted with a borderless and permissionless super economy, regulators would prefer to choose Big Tech, giving up autonomy and providing centralized control. They would also prefer to incorporate CDBCs (Central Bank Digital Currencies) over cryptocurrencies as the latter are, in some cases, impossible to regulate.
The great user experience and hardware that big tech supplies feel compelling to the typical user, but the “Open Metaverse” must improve on that, and quickly. We will describe the way to this autonomous future and the hurdles delaying the open metaverse.
Online Growth
When asked to explain the internet, most may do so from a personal perspective. However, any answer provided now remains different to what was given given in the 1990s, the decade marking its infancy.
The metaverse currently stands at the same precipice. Where is it going? How will it get there?
Web 2.0 development felt significant but ultimately siloed. As we move into Web 3.0, we enter a phase of open-source development long in the making. For example, between 2015 and 2021:
- NFTs went from zero trading volume to $17 billion
- Daily active users of Minecraft and Roblox grew from $20 million to $150 million
- “Virtual skin” revenue grew from $5 billion to $54 billion
The Metaverse’s Potential
As the convergence of Web 3.0 happens, changes will come slowly but speed up exponentially. Since there are two competing metaverses, the pioneers and active participants on the permissioned (Big Tech) and un-permissioned (Web 3 blockchain) teams will conflict with one another as they beach build their vision.
Despite this, the web of our children and grandchildren will hold value, possibility, and wonder exceeding our current imagination. But will they be able to take control of their data without having to give up the internet’s benefits that make it the innovation that it is?
The Creation of Virtual Worlds
In an open metaverse, a virtual world is a simulated space with people, not corporations, forming its core of open-ended possibilities. This differs from a game that has set rules and goals.
Users retain independence and free will within the society being built around them. They explore and expand through participation in local societies and economies.
This convergence of time, value, and resources is what creates the communal utility. Whether digital or physical, any community can thrive given these building blocks.
Worlds Interlinking
Building a metaverse is a monumental task from both the resource and user engagement standpoints. There are a few well-capitalized metaverses attempting to build their respective “verse” from the ground up.
Decentraland, the Ethereum-based metaverse, started in 2015 and is the grandfather agnostic platform selling land for casinos, Japanese shopping centers, or the metaversal headquarters of Sotheby’s.
The Sandbox is the next ETH-based competitor holding relationships with Deadmau5 and the Walking Dead. But it is not at all dead with a Softbank-led series B funding round that raised $93 million, giving it a $2.5 billion valuation, with virtual real estate’s portion totaling $144 million (the highest in the space). The most of any metaverse.
Somnium Space is backed by the Facebook-famous Winklevoss Twins and is positioned as the high-end metaverse optimized for VR.
CryptoVoxels is popular for digital art and has islands of communities. It’s accessible from a smartphone with no VR headset necessary.
Bit.country does not have land scarcity, but an infinite number of interoperable worlds. It’s the closest thing to an accurate representation of an open metaverse.
Like in the real world, culture is the fabric that ties a digital society together. It is a shell until populated.
Each “verse” will have its own culture and customs. Decentraland had a first-of-a-kind four-day Metaverse Festival. Somnium Space has its Sky City Concert Hall.
These worlds will need to connect to be a true metaverse. Auki Labs has invented a way to effortlessly share AR (augmented reality) experiences across devices and applications, making it a true social experience.
Virtual World Colonization
Web 3.0 has digital rights and ownership tags, borders and virtual land plots. And there are already a wide spectrum of uses for digital lands.
Or these lands can be rented for simpler, more commercial reasons, such as creating passive revenue (i.e., ATM feesand advertising). Alternatively, the land can be sold through an NFT. The Sandbox has 12,000 landowners.
The next step requires the development of virtual structures and governments. Will there be zoning? Will there be jurisdictional differences and disputes? Will there be planning?
Separate verses within a metaverse necessitate some foresight to ensure harmony and to create bridges between diverse communities.
This is done with open standards, cross-chain NFTs, and populating more than one world with a single personalized avatar. These are the required developmental steps vital for giving the metaverse expansive depth.
Finance in an Open Metaverse
Our hope is that DeFi will be driven by the application layer of the metaverse. The current MetFi is like the metaverse; a layer above the real world, yet it’s always the base, application layer that matters most.
This layer enables the financial inclusion of creators, gamers, and other digital natives with their wealth not in traditional finance. MetFi is all-encompassing, with services, products, and protocols connecting non-fungible and fungible tokens within a wider ecosystem. With this layer and its tools, pioneers can create a parallel economy for users of the various metaverses.
Identity Through Avatars
As the metaverse grows, so too does its need for identity solutions. This will likely happen through avatars and wearables becoming more fluid and context specific.
Identity is what makes us unique. How we are identified shall be unique as well. Then, our avatar’s ownership must be indisputable.
In the real world, you create several personalities, reacting to different individuals, that are potentially pseudo-anonymous. It’s possible to do the same in the metaverse, but this brings an ethical question: Should anonymity remain permitted?
FilterYa brings the digital and real worlds together by providing a digital identity and replicating your actual self in the digital beyond. Similarly, CryptoAvatars creates NFT Avatars through a Virtual Reality Modeling (VRM) format that can be used in Twitch, Meet, and Zoom33, among others.
Summary
As we move into the metaverse, we contend with several questions at once. Do we want to turn over our rights and control to Big Tech, or do we want the metaverse to remain open? For the user who wishes to be free, the open pathway makes more sense. With the Web 3.0 pathway, your data is yours, not the property of a corporation.
Financial services may similarly come from centralized authorities, or they may come from a new system utilizing cryptocurrencies. NFTs may form a key pillar of this new system by allowing for fractionalization and democratizing access to capital.
Finally, the idea of the self will be tested. How identity is thought of will be in question. Will a digital identity be one and the same as a real-world identity? Will anonymity bear with it moral consequences?
All futures are possible with the metaverse. It’s important that we retain the right to choose the future best for us.
Disclaimer: The author of this text, Jean Chalopin, is a global business leader with a background encompassing banking, biotech, and entertainment. Mr. Chalopin is Chairman of Deltec International Group, www.deltecbank.com.
The co-author of this text, Robin Trehan, has a bachelor’s degree in economics, a master’s in international business and finance, and an MBA in electronic business. Mr. Trehan is a Senior VP at Deltec International Group, www.deltecbank.com.
The views, thoughts, and opinions expressed in this text are solely the views of the authors, and do not necessarily reflect those of Deltec International Group, its subsidiaries, and/or its employees. This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service, or offering. It is not a recommendation to trade.