What Is A Metaverse?
In recent weeks, the metaverse has been a hot topic. The term became popular after Facebook, which owns the social network of the same name, as well as Instagram and the WhatsApp messenger, was renamed Meta. Facebook founder Mark Zuckerberg was the first to announce plans to build a digital space using AR and VR technologies. According to him, in the metaverse, people will be able to work, communicate, relax and shop. That is pretty much everything they do in the real world. Many in Silicon Valley believe that the metaverse is the next big leap in modern technology, one that could revolutionize the world like smartphones.
For the first time this term was used in the science fiction novel "Snow Crash" by American writer Neil Stevenson, published back in 1992. This work describes a rather gloomy future in which, after the global economic collapse, the world is ruled by large corporations and mafia structures. The main character is Hiro the Protagonist. In real life, he works as a pizza delivery man, and in the virtual world he is a famous hacker and samurai who must stop the spread of a dangerous virus.
Metaverse – NFT Universe?
There is a possibility that it is the NFT that will become the basis of the economy in the metaverse, including the metaverse of Mark Zuckerberg. Why is this so?
- First, in the metaverse, we will need to constantly confirm ownership of clothes, avatars, virtual real estate, tickets to events and much more. And NFT, due to the ability to create unique tokens and the transparency of transactions in the blockchain, is great when it comes to registering ownership of an object. Information about the owner is indicated in the metadata of the token, and in order to find out who owns the metaverse crypto token, you need to find the token on the site and see the metadata.
- The second point is business. The metaverse will, in large part, be driven by entrepreneurs who provide services, create content, and do a lot of useful things for the metaworld. And for entrepreneurs, the most important thing is to monetize their services as efficiently as possible. And here again non-fungible tokens come to the rescue. So, for example, a psychologist can issue a token that gives ownership of the right to an hour session, an online cinema will issue tokens for the right to watch movies for a certain period. Also, tokens can be a pass to a closed club, to an event or even to another planet. By purchasing an NFT, you can become the owner of a virtual land plot, build virtual real estate on it, create an NFT for this real estate and rent it out, earning money.
But why can't it all be done the old fashioned way? NFTs are created using smart contracts. A smart contract is a program that fulfills agreements between two or more parties, as a result of which, when certain conditions are met, certain actions take place. That is, when a previously programmed stipulation is fulfillу, the smart contract automatically executes the corresponding agreement. So, when a deal is executed in the format of a smart contract, it will not be possible to collect money and escape without fulfilling the conditions. At the same time, in order to receive a service, for example, to rent a property, you do not need to interact with anyone. It is enough just to purchase a token, all the rest of the work will be done by a smart contract.
A smart contract is developed in a special programming language (like Solidity), compiled into Ethereum Virtual Machine (EVM) and, with some exceptions, complying with a certain standard (ERC-20, ERC721, ERC1155, etc.). Standards are one of the components that make non-fungible tokens very powerful. They guarantee developers that assets will behave in a certain way and also describe how to interact with the underlying functionality of the assets.
Among other things, NFT is a very secure technology. Firstly, the blockchain itself has excellent security parameters – cryptographic algorithms for verifying transactions, hashing when creating new blocks, decentralization. But the process of storing NFT metadata can be organized very securely – they are stored either on the blockchain or in the Interplanetary File System (IPFS) – a peer-to-peer file storage system. That is, the names of the owners of the asset and other metadata cannot be changed in a fraudulent way: the blockchain will remember everything.
NFT is now the technology of greatest interest to crypto enthusiasts and collectors, and the metaverse is of greatest interest to digital techies. But the world is changing: the era of the metaverse and metaverse gaming is coming, in which blockchain and NFT will play a very important role.
Already Existing Metaverses
In 2021, the term “metaverse” began to hit the headlines in Forbes, The Washington Post, The Economist, and tech giants started calling metaverse building their new strategy.
Major players are in a hurry to stake out their place on the construction site of the new online world. Following Zuckerberg, Microsoft announced plans to build its own metaverse. The company promised that Teams users will be able to use their 3D avatars to visit virtual offices and other spaces as early as 2022.
Let's take a look at a few examples of pre-existing metaverses.
The metaverse can function as a mixture of software, immersion hardware, data centers, and blockchain technology.
- Software are projects of the virtual world that are created using 3D engines. The most famous platforms are Unreal Engine and Unity.These engines build the infrastructure of the virtual world: cars, houses, landscapes, characters. And they do it so realistically that movie studios use them to speed up the filming process.
- The equipment is VR glasses and AR gadgets for interacting with the metaverse. Let's call them guides of the user to the metaverse. There are about 7000 companies in this industry. But the main players are already well-known companies: Facebook, Snapchat, Microsoft, HTC, Google.
- Data centers are cloud storage for metaverse data. The AR data storage market is estimated at $50 billion by 2024, according to the Three Kit. Again, the main suppliers are well-known companies: Amazon, Google, Microsoft, Nvidia and others.
- A blockchain that will attach the data and money of each user directly to his or her digital account and will allow the purchased products to be used throughout the metaverse.
There are approximately 2,000 different projects that link themselves to the metaverse. These are workspaces, blockchain-based games, social networks, and more. Let's go through the most popular ones.
- Fortnite is the first project that comes to mind when the word "metaverse" is used. This is a royal battle game where 100 players land on one map, get weapons and resources, kill and even save each other in order to remain the only survivors on the map and take 1st place. There are quite a few popular battle royale games out there, like PUBG, Call of Duty Warzone, but Fortnite takes the top spot.
- Roblox is a construction platform game where independent developers can create story games for kids. The beauty is that each user can create their own game. You don't need to know the code or be an expert in the gaming industry to do this.
- Replika – bots endowed with artificial intelligence that can play the role of a friend or soul mate. Bots use text messages to communicate with people, play games, and even write songs and poems. Since September 2021, the bot has been working with Oculus Rift VR glasses.
- Gather. Gather’s investor, Sequoia Capital originally described this project as "Minecraft meets Zoom." Although the option "Minecraft and Zoom gave birth to a child" is more suitable. Gather is a virtual online 2D space that duplicates office space, wedding halls, conferences and other crowded places.
- Facebook. In July 2021, Mark Zuckerberg officially announced that Facebook would turn into a metaverse within 5 years. The company uses several products to achieve this goal. Two of them are known: Horizon and Rival Peak. The rest have not been announced.
- Horizon is Facebook in the virtual world. Due to Oculus Quest 2 VR glasses, users will be able to navigate a specific map, chat with their friends, watch broadcasts, play games and even cook. On August 19, Facebook Horizon launched a beta version of the remote work app. Let's call it Zoom with 3D avatars, where the avatar follows all your movements and facial expressions. The app is free.
- Rival Peak is a reality TV show where AI-controlled virtual heroes perform actions that viewers of the show present to them in real time.
Big Investors Bet On Metaverse
Many large venture capital funds have already bet on the metaverse trend.
Andreessen Horowitz is a large American venture capital fund. Enters deals in the early stages. The most famous fund investments: Facebook, Airbnb, Coinbase, Lyft and others. In 2021, 11 out of 143 investments were made in projects related to the metaverse. The most popular metaverse projects in the fund's portfolio are NFT gaming projects Dapper Labs, Roblox and one of the largest NFT-marketplaces – Open Sea. All projects are focused on metaverse games and NFT.
Sequoia Capital is another large American venture capital fund, which is already 49 years old. Enters early and late stages of startup development.The most famous fund investments: PayPal, LinkedIn, Stripe, Zoom and others. In 2021, 6 out of 106 project investments were related to the metaverse. The most popular metaverse projects in the fund's portfolio are Gather and RecRoom, a game/social network. All projects are related to a mixture of social networking and games.
Index Ventures is a European private equity fund. It mainly enters into deals at the later stages of startup development, when there is a working business model and competition. The most famous fund investments: Dropbox, Trello, Farfetch, Revolut. In 2021, 4 out of 83 investments were made in projects related to the metaverse. Focus is made on streaming platforms.
The metaverse concept is at a very early stage, and many do not believe it will grow into something worthwhile. The metaverse currently has four major difficulties:
- States want to control the virtual world. The Chinese government has already limited the amount of time children can play during the week.
- Content moderation. There have already been stories of sex parties and neo-Nazi club meetings in the metaverse.
- Privacy. Tracking all user actions is a large amount of personal data. It is important to keep them safe.
- Intellectual property. The metaverse should be like the Earth: everyone creates something of their own in it, but physically cannot own the whole planet.
Despite all the difficulties, the pandemic has accelerated the development of the virtual world. COVID-19 has shown how important the metaverse is: people buy virtual things for $69 million, make their living playing digital pokemons, spend more time on social networks and platforms that rely on the metaverse, and prefer to work remotely. Perhaps in10 years we will not completely transfer our life to VR glasses. But the fact that most of the time we will spend in the virtual world and say to each other "see you in the metaverse" is more than likely.
The metaverses of the future are fraught with inexhaustible opportunities. Boosty Labs will help a project or game to take its rightful place in this wonderful new world. The company's specialists have solid experience in areas such as NFT/blockchain gaming development, tokenomics consulting and development, and NFT marketplace development. Boosty Labs is a world-class fintech and cloud engineering team with a background of practice that combines consulting, strategy, design and engineering at scale.