What is metaverse in blockchain? A beginner's guide on an internet-enabled virtual world

Metaverse explained

These days, everyone seems to be talking about “the Metaverse” as the next big thing that will alter our online lives. However, everyone appears to have their interpretation of “the Metaverse”—that is, if they have one at all.

The term “metaverse” was first used in Neal Stephenson's iconic cyberpunk novel Snow Crash, published in 1992. But, what is the Metaverse? The Metaverse (always capitalized in Stephenson's fiction) is described as a shared “imaginary realm” that is “made available to the public across the worldwide fiber-optics network” and projected onto virtual reality goggles in the novel. Therefore, the phrase can apply to digital settings that have been enhanced with virtual reality (VR) or augmented reality (AR). 

Meta in the term means “beyond” and verse refers to the “universe.” Moreover, some people also use the term metaverse to refer to virtual worlds in which players can roam around and interact with other players; for instance, a world where developers can build buildings, parks, signs and things that do not exist in reality. It includes vast hovering overhead light shows and notable neighborhoods (where the rules of three-dimensional spacetime are ignored, and free-combat zones where people can go hunting and kill each other).

The COVID-19 epidemic ignited the interest in the metaverse. As more individuals work and go to school online, there has been a rise in the desire for techniques to make online contact more lifelike.

Mark Zuckerberg revealed in July 2021 that the company intends to construct a more maximalist version of Facebook that includes social presence, office work and entertainment. Facebook changed its name to Meta on October 28, 2021, reflecting its more significant commitment to creating a virtual environment known as a metaverse.

In this article, we will discuss metaverse coins, tokens and wallets as well as blockchain metaverse startups, crypto metaverse projects and how the metaverse works. 

What are the core attributes of a metaverse?

The most popular ideas about the Metaverse come from science fiction. The Metaverse is frequently depicted in this context as a kind of digital “jacked-in” internet — a manifestation of actual reality but one grounded in a virtual (often theme park-like) world. So, the core attributes of the Metaverse can be identified as:

• Synchronous and live: While pre-scheduled and self-contained events will occur, the Metaverse will be a living experience that exists continuously for everyone and in real-time, just as it does in “real life.”

• Persistent: It never “resets,” “pauses,” or “ends,” — it just keeps going endlessly.

• Available individually and concurrently: Everyone can be a part of the Metaverse and take part in a specific event/place/activity simultaneously and with their agency in the Metaverse.

• A fully functioning economy: Individuals and businesses should be able to create, own, invest in, sell and be compensated for a vast array of efforts that produce value that others recognize.

• An experience: It should span both digital and physical worlds, private and public networks/experiences, as well as open and closed platforms.

• A wide range of contributors: It should be filled by content and experiences developed and operated by many contributors, some of whom are self-employed, while others are informally organized or commercially-oriented businesses.

• Offer unprecedented interoperability: It should offer remarkable data, digital items/assets, content, and other interoperability between each of the experiences—a car developed for Rocket League (or even Porsche's website) could be transported over to work in Roblox. Today's digital world operates as if it were a shopping mall, with each store having its own money, unique ID cards, proprietary units of measurement for items like shoes or calories, and various dress rules, among other things.

What is not the Metaverse?

While the comparisons above are likely to be part of the Metaverse, they aren't the Metaverse, themselves.

For decades, virtual worlds and games with artificial intelligence (AI)-driven characters and those populated with “actual” humans in real-time have existed. Therefore, “a virtual world” isn't a “meta” universe but a fictitious and synthetic one created for a particular goal (a game).

Similarly, digital content experiences like Second Life are often referred to as “proto-Metaverses.” 

But various facets of virtual worlds, like the representation of humans by digital avatars, lack of game-like goals or skill systems and virtual hangouts persist and even though they offer virtually simultaneous content updates, they are insufficient for the Metaverse. Therefore, “a virtual space” isn't a metaverse.

Virtual reality (VR) is a method of experiencing a virtual world or area. A sense of presence in a digital world isn't enough to constitute a metaverse. Furthermore, while a metaverse may have some game-like aims, feature games, and use gamification, it is not a game in and of itself, nor is it focused on specific goals. Hence, it is neither “virtual reality” nor “a game.” 

A metaverse is not centrally programmed like Disneyland; therefore, it is not a “virtual theme park.” Similarly, a metaverse is not a “new app store”; instead, it is fundamentally different from contemporary internet/mobile paradigms, design and priorities.

How does the Metaverse work?

The metaverse can be divided into two sorts of platforms in general.

The first involves leveraging nonfungible tokens (NFTs) and cryptocurrencies to create blockchain-based metaverse startups. People can buy virtual land and create their own settings on Decentraland and The Sandbox platforms.

The second group uses the metaverse to describe virtual worlds in general, where people might meet for business or enjoyment. In July, Facebook Inc. announced the formation of a metaverse product team.

People who buy or trade virtual assets on blockchain-based platforms must use cryptocurrencies, despite many metaverse services offering free accounts. Several blockchain-based platforms, such as Decentraland's MANA and The Sandbox's SAND, require Ethereum-based crypto tokens to purchase and sell virtual assets.

Users can trade NFT artworks or charge for admission to a virtual show or concert in Decentraland. They can also make money by trading land, which has seen a significant increase in value in recent years. Users can earn money on Roblox by charging other users for access to their games.

What can you do in the Metaverse?

One can take a virtual trip, buy digital clothing, go to a virtual concert in the crypto metaverse projects. Amid the COVID-19 pandemic, the Metaverse could be a game-changer for the work from the home shift. Horizon Workrooms, a free open beta from Facebook, is now available for download on Oculus Quest 2 in regions where Quest 2 is supported. 

Workrooms is a virtual meeting space that allows you and your coworkers to collaborate more effectively from any location. You can join a conference in VR as an avatar or make a video call from your laptop or PC to the virtual room. You can collaborate on ideas using a sizable virtual whiteboard, bring your computer and keyboard into VR to collaborate with others, or have expressive discussions that feel more like you're in person.

However, tech firms must yet figure out how to connect their various web channels. To make it work, competing technological platforms will need to agree on a set of standards to avoid switching between the Facebook metaverse, Microsoft metaverse, or others.

Is crypto the key to the Metaverse?

The Metaverse's goal is to provide people with an augmented reality experience that, in many ways, may surpass physical reality in terms of experiences and opportunities.

Let's take a look at why the metaverse needs encryption to function correctly.

The unhackability and immutability of blockchain are critical properties for any virtual reality technology to gain broad adoption. Hacks and data breaches are common, but if people are supposed to operate in an entirely online and virtual environment, the underlying platform on which they will be operating must be secure.

Not only does blockchain allow for fast confirmation of information, but it also allows for cryptographically secure and protected transactions. Blockchain and crypto assets are a fundamental and integral aspect of how virtual reality will be deployed.

Building on the previous point, the Metaverse will want and require transactions to be completed on demand, which blockchain and crypto assets can help to enable. There will need to be transactions for an actual virtual reality environment to work and perform as stated. These transactions must be secure and virtually fast. Individuals in this ecosystem, in particular, will need to be able to: a) transact and engage as readily as if they were in person and b) have trust that these transactions will be completed.

Individuals and institutions can conduct transactions in a virtual, traceable and real-time manner via crypto transactions, which are feasible and proven methods. However, even without the continued use of blockchain and crypto-asset technology, the trend toward virtual and online payments has been growing. Transacting and engaging in commerce in an online environment has become a mainstream evolution that has become even more commonplace with the adoption of crypto payments by Visa, Mastercard and PayPal.

Crypto-enabled payments became even more prevalent in a virtual ecosystem, such as the metaverse, and it makes sense that such payments will move to the forefront in the future.

The Metaverse is still a developing and rapidly expanding field. Still, the bottom line is that to support and actualize a fully functional metaverse, blockchain and crypto assets will need to play a significant part in its future implementation.

Are there any concerns with the Metaverse?

A few other concepts could be fundamental to the Metaverse, although they aren't universally accepted. One of these concerns is whether participants will have a single digital identity (or “avatar”) that they will use throughout all of their encounters. This would be useful, but it's doubtful because each of the “Metaverse era's” leaders will still want their identification systems. 

Today, for example, there are a few dominant account systems – but none covers the entire web, and they frequently stack atop one another with limited data sharing/access. For instance, if your iPhone is linked to an iOS account, you might use your Meta (previously Facebook) ID to log into an app, which is linked to your Gmail account.

There's also debate over how much interoperability is required for a metaverse to be “the true Metaverse,” rather than just an evolution of the internet as we can see today. Many people also question whether or not a real Metaverse can have only one operator (as is the case in Ready Player One). 

Some argue that a Metaverse's definition necessitates a heavily decentralized platform based primarily on community-based standards and protocols (similar to the open web) and an “open source” Metaverse OS or platform (though this does not rule out the presence of dominant closed platforms in the Metaverse).

Is the Metaverse only a Facebook initiative?

No, the Metaverse is not just an initiative by Facebook. Microsoft and chipmaker Nvidia are two more corporations that are promoting the metaverse. Companies that make video games are also taking the lead. Epic Games, the maker of the famous video game Fortnite, has raised $1 billion from investors to help fund its long-term metaverse aspirations. 

Another major player in the game platform is Roblox, which describes the metaverse as a place where “people can come together within millions of 3D experiences to study, work, play, create and socialize.

Consumer brands are also attempting to capitalize on the trend. Gucci, an Italian fashion business, teamed up with Roblox in June to sell a line of digital-only accessories. Coca-Cola and Clinique both sold digital tokens that were marketed as a way into the metaverse.

Who else is capable of creating the Metaverse?

Although the Metaverse can replace the internet as a computer platform, its development path is unlikely to be similar to that of its predecessor. Private industry is not only fully aware of the Metaverse's potential, but it also has the most aggressive belief in its future, not to mention the most money, the best engineering skill and the most ambition for conquest. The leading technology companies want to own and define the Metaverse, not merely lead it.

Open-source projects with a non-corporate attitude will continue to play an essential role in the Metaverse, and they will attract some of the most exciting creative talents. However, there are only a few potential leaders in the early Metaverse, including Microsoft, Apple, Meta and Amazon.

The metaverse crypto projects include Microsoft’s Mesh platform. With this platform, the software giant builds mixed and extended reality (XR) applications that integrate the real world with augmented reality and virtual reality. The US Army is reportedly developing an augmented reality Hololens 2 headset with Microsoft for soldiers to train, rehearse and fight in. Furthermore, Xbox Live links millions of video game gamers all over the world.

While Apple has lagged behind companies like Meta and others in releasing the first AR and VR gadgets, the Cupertino corporation may not be too late. Apple has created a sophisticated HMD (Head Mounted System) Virtual Meetings app for the impending Metaverse. Apple's patent also covers several technologies that enable people to sense and interact with enhanced reality (ER) environments. 

The former Facebook has previously made considerable investments in virtual reality, including the acquisition of Oculus in 2014. Meta envisions a virtual world where digital avatars interact via virtual reality headsets for business, travel or leisure.

However, there's too much about the Metaverse that we don't know about to have strong opinions on who will lead it or how they'll bring us there. In reality, the Metaverse is most likely the result of a network of disparate platforms, bodies, and technologies cooperating (though grudgingly) and embracing interoperability.

The internet as we know it now is the result of a somewhat chaotic process in which the open (mainly academic) internet evolved alongside closed (primarily consumer-oriented) services that frequently sought to “rebuild” or “reset” open standards and protocols.

The future of the Metaverse

It's unclear how real a true metaverse that perfectly mirrors actual life can be or how long it would take to create. Many blockchain-based metaverse platforms are still working on AR and VR technology to ultimately allow users to interact with the environment.

PwC, a worldwide accounting and advising firm estimates that virtual reality and augmented reality would enhance the global economy by $1.5 trillion by 2030, up from $46.5 billion in 2019.

Facebook Inc, Alphabet Inc-owned Google, and Microsoft Corp have all invested in cloud computing and virtual reality companies to anticipate the industry's expansion.

There will be enormous money for firms that can monopolize certain regions, such as supporting platforms or services like payments, subscriptions or advertising, just as there was big money for companies who dominated “the internet.”