The world is entering into a new and exciting age of technology, the expansion of which has only ever been witnessed in science fiction. Take a step forward and leap into the Metaverse.
Fantastic new worlds are about to emerge, full of potential, where one is not limited by the boundaries of the physical body, nor the laws of physics.
The potential applications of these virtual worlds are essentially boundless, as everything within them is defined by those who create them.
The term “Metaverse” has been used to describe these virtual landscapes that we are about to examine here.
What is the Metaverse?
If we start at the beginning and build up a mental image of these virtual worlds, they emerge with essentially nothing but endless space. An infinite, but ultimately empty arena, waiting to be defined.
Upon this void, we firstly define the universal laws that govern it, like gravity. We then set out to build the world itself; the elements of the virtual world that make up what we can interact with. We add solidity to it, so we have somewhere to stand, somewhere to play and somewhere to interact with one another.
Once the virtual world has been defined into the most minute detail, we populate it with citizens from the real world.
These citizens transition from the real world into the metaverse, through the aid of technology and transcend the barrier, in order to become whoever they desire to be.
They leave their physical form behind and enter the metaverse as a digital representation of themselves, called an “Avatar”. Only now, when the metaverse is populated, can it be considered complete.
These new virtual worlds, or metaverses, can take on any shape and form, but to a large extent, they will derive structure from the physical world that we already know.
The difference being, that inside these virtual worlds, things normally beyond our reach can become a reality. What we can only dream of, can be experienced and enjoyed in a lucid state, in the playgrounds of these arenas of wonder.
At the core of the idea of these virtual landscapes, lies the concept of freedom. The freedom to choose to see things from another perspective. The freedom to experience the world and social interactions outside the realm of convention. The freedom to become unchained from the restraints of the physical realm, and enter into a world, where one can be imbued with nothing less than magical powers.
In other words, we enter into the realms of artificially Augmented Reality (AR) and fully immersive Virtual Reality (VR).
These new worlds, or metaverse, can be either social platforms, gaming platforms or a mix of the two.
Gaming platforms are more common and can form entire ecosystems of players doing anything from interacting socially with other users and taking part in games and events.
One of the most highly developed gaming ecosystems today is the game The Sandbox.
This virtual wonderland will be something to behold and it has also attracted a multitude of sponsors, raising up to $100M USD in funding. The project is large enough to entice all sorts of partner companies to gravitate towards it, eagerly ready to engage in commerce and advertisement, among other things.
The potential for revenue is only limited by our imagination.
If we take a closer look at that concept, we soon arrive at the question; what is possible within the metaverse? The answer is; anything that we can conceive and put into effect technologically.
The technological applications of virtual reality extend into every branch of human activities, be it social interactions, entertainment, business, science, art or education.
This brings us to the socially orientated metaverses that are designed to function as meeting places for people around the world, where they take part in all sorts of social and cultural activities.
There is naturally, also a business aspect to these metaverses, where advertisement and commerce will also play a large role.
Countless visitors will marvel in awe and also spend crypto currency tokens to both take part in activities and purchase NFTs, or “Non-Fungible Tokens”, to further enhance their experience within the metaverse.
Although the construct and purpose of these metaverses vary, a very good example of an upcoming project that falls into this category is Bloktopia, a 21-story virtual skyscraper that will host all sorts of social activities, both educational and entertaining in nature.
The entire project is also designed as a virtual place of commerce and advertising space, where ads gain more and more exposure, the higher up you go. This project, and more, will be featured in our upcoming reports.
Simply put; the metaverse is merely another name for three dimensional virtual worlds, in which users can interact with computer or user generated world elements, as well as other users.
Many, if not most of these metaverses are currently taking form on decentralized blockchain technology. Some will be presented in a more traditional way, and viewed on either a computer or mobile device screen, while others will delve deeper into the realms of augmented reality, where the real world and the virtual worlds meet, as well as fully immersive virtual reality experiences that require specialized hardware.
Ideally, these virtual landscapes would also become connected to one another, forming a vast link of networks, woven together in order to create a larger whole. Bridges between the various services would enable the users to transition from one virtual landscape to the next seamlessly.
These ideas are not new, but the way they are rapidly being applied, however, is. The decentralized nature of cryptographic blockchain technology is causing a shift in control and ownership of digital assets to the individuals, instead of authoritarian institutions, like production companies or large financial collectives.
Here again, we arrive at the notion of freedom for the individual.
Different developers have different visions on what the perfect metaverse would look like, so many of them are emerging at the same time. Some will prove to be more successful than others.
NFTs or Non-Fungible Tokens
Traditionally, users have not been able to claim ownership over digital goods inside virtual arenas, like games or social platforms, as all the virtual assets belonged to the developers, under strict laws.
Yet, users were being charged funds for the right to essentially borrow these items within the confines of the particular virtual arena they found themselves in.
The digital asset could not be removed from this environment, nor sold for profit, when it was no longer of any use.
The introduction of unique, non-fungible tokens, or NFT, changes all that and flips the entire concept on its head. Once acquired, the digital asset becomes the property of the user and can be used or sold freely at one’s own discretion, even outside the metaverse.
Much like the various iterations of the metaverse, NFTs can also take on many forms.
Any idea, transformed into a digital form can become an NFT. Typically, these are divided into two distinct categories; collectables and utility tokens.
Examples of the first would be digital art, in all its forms, and examples of the latter would be game-related or social platform assets that can both appreciate in value and be put to good use inside the various metaverses.
Preserving the value of NFTs
Now then, it’s fairly obvious that even a perfect copy of the painting of Mona Lisa by Leonardo da Vinci has no true value.
The same applies to copies of NFTs. It’s fairly simple to make a copy of a digital representation of something, but that copy holds no value, compared to the original NFT.
The ownership of digital tokens is maintained by the ledger on the crypto blockchain, which makes it almost impossible to forge records. Copies of the blockchain are kept on countless computers and each item, contract and transaction on the blockchain are linked to every entry that comes after it.
Forging a record on the blockchain, means you have to re-write the record you want to change, every subsequent entry after it, on every copy of the ledger, all at the same time. NFTs are locked inside smart contracts and those contain metadata about the owner, as well as other pertinent information.
This is both how the authenticity of the item, as well as the identity of its owner, are ensured.
The fact that these measures are in place, means that the value of digital tokens can be preserved.
The different types of NFTs take shape and form, depending on the virtual landscape where they belong. Digital art, for example, functions much in the same way as physical art, as do NFT collectables that have no use beyond being admired.
NFTs created for social or gaming platforms have a dual purpose; they function as usable items inside the metaverse, but also as potential investments. The price of all NFTs is driven by scarcity, popularity and demand.
The items in the second category are slightly more complex in nature, as they can change form in various ways and increase in value through transmutation. In some cases, in the form of combining or breeding NFTs to one another, thereby sometimes giving rise to increasingly valuable “offspring”.
There’s a multitude of these gaming NFTs, but mostly we are talking about character customization options or gear, as well as land. In the same way virtual real estate can be owned, developed or monetized, as in the games The Sandbox or MonkeyBall, featured in our product report.
Art and collectables can be displayed in virtual galleries and even admired in virtual or augmented reality. There is a bit of overlap between the two categories, as collectables can also find their way into social and gaming platforms, where predominantly utility tokens dominate.
The function of these utility tokens can range from customizing the personal appearance of one’s metaverse avatar, to providing the character with powerful objects or powers that ensure higher chances at survival or success during gameplay or similar activities.
In terms of social platforms, this translates into personal expression and defining how one wants to be viewed by others. This is not strictly limited to conservative ways of presenting oneself and may even take on fantastic forms.
What is of the essence here, is that people are provided with the opportunity to express themselves freely.
The various games and social platforms featuring NFTs are too many to list, but needless to say, they are all in high demand and rare ones also fetch a very high price.
This is especially true when it comes to virtual land property. It is the foundation upon which the entire ecosystem is built.
Crypto Currency in the Metaverse
The idea of the metaverse is that it will be accessible to anyone who wants to visit, but also that the metaverse will provide investors with business opportunities, for which the users must pay a fee.
So, it’s no surprise that one cannot really get far inside the metaverse without spending some hard-earned coins.
That being said, most game type metaverses also provide the opportunity to earn crypto tokens by completing tasks.
This idea revolutionizes the concept of gaming, as it has been strictly pay-to-win and not play-to-earn, up to this point.
The underlying financial structures of these mechanisms are currently complex and often rely on more than one token, network or protocol.
Each metaverse will have its own currency or token that can be used, in order to pay for services or to acquire desirable items.
Whether it be for the purpose of personal expression of one’s avatar, or to gain the upper hand in games, it will all be sold and bought for cryptographic tokens.
The more popular the metaverse, the more the value of the token will appreciate, as more and more users will need to acquire the token, in order to spend it.
In addition, more often than not, different types of decentralized finance opportunities are also linked to the games and some have complex multi-token mechanisms that also allow investors to govern the way the game takes shape.
Digital Commerce, Advertising and Financial Prospects in the Metaverse
Let us take a look at the financial business perspective that the metaverse environments and NFTs bring to the table.
If we dispense with the rather straightforward business of collecting and trading valuable digital art, we can move on to the financial spectrum of gaming and social interaction.
As we mentioned earlier, one of the fundamental parts that make up any metaverse is the land itself. As in real life, digital real estate also has the potential for huge monetary gains.
Often, the land is finite and therefore, increasingly difficult to acquire once sold. Typically, the value of the land depends on its location inside the metaverse. Prime locations will be highly sought after and attract the most buyers, but also users.
There are many ways to monetize land in virtual landscapes. One can rent out the land for profit or establish some form of activity on the land that will generate passive income, as the users pay tokens to partake in the services or entertainment provided there.
Games, spectacles, wonders, live entertainment, VIP events, gambling and every possible social activity that one can think of, is possible to arrange inside the metaverse, as long as one has access to land, and there’s profit to be made from these activities, as long as they are carefully planned out and put into action.
In addition to entertainment and commerce, other forms of business are also equally possible.
Furthermore, let’s not forget that advertisement will play a big role inside these metaverses and any party that wishes to establish or promote itself therein, will have to either buy or pay rent for land, in order to set up whatever business venture they have in mind.
Providing services or entertainment, while promoting one’s business, would be a good way of attracting users to the site and thereby generating more income.
Apart from profiting from the land itself, the utility tokens or NFTs themselves can also be valuable investments, especially if created and sold at little or no cost.
The metaverses or virtual reality worlds present a solid business opportunity in many ways.
In order to make informed decisions in tokens, one must first be able to identify the projects that will become popular and also recognize the underlying supporting networks and protocols that make everything possible, as they have become crucial and therefore constitute a sound investment.
Decentralized finance platforms running alongside the gaming or social platforms also provide another way to make a profit from these new virtual venues.
Here at Gamelabs, it’s our job to figure out all of this crucial information for you and provide you with the all keys that you will need to unlock the doors to success.