What is the Metaverse?

In Neal Stephenson’s 1992 book Snow Crash, he imagines a world where society largely exists within a virtual realm which he christens “the Metaverse”. People access the Metaverse through virtual reality (VR) headsets, and once in, they enter a completely digital urban world that behaves much like the “real” world in terms of how people use it. In the Metaverse, people live out their lives much as they would in the real world, hanging out with friends in shopping centers or talking with business associates in private lounges. Everything in the Metaverse is just as real as the physical world in terms of how people interact with each other.

 

A couple decades later, Ernest Cline released his book Ready Player One, which built on Stephenson’s premise of a virtual alternate reality. But he took it to a much more vivid and colorful level. In Ready Player One, society primarily operates within the virtual realm, although it is not called the Metaverse in this novel. People go to work, school, do their shopping, play video games, and hang out with friends, all within consoles connected to VR headsets called the OASIS. Physical, treadmill-like devices allow them to move around in 3D space, and users wear haptic clothing in order to “feel” in this virtual environment.

 

Fast-forward to today, and “Metaverse” is suddenly a buzzword in the blockchain space. The popularity of non-fungible tokens (NFTs) has led to new interest in how our lives are shifting into the virtual realm. At this time, the convergence of gaming, VR tech, social media and blockchain tech are making both Stephenson’s and Cline’s worlds a reality. 

 

Web 3.0

Web 1.0 defined the AOL era of the Internet, where people would go online just to look up information or send emails and chats. Then came Web 2.0, which is the current social media era, where we’re now sharing high volumes of information about ourselves, news, and media with the ability to monetize that data. What comes next is Web 3.0, which is when the blockchain layer becomes ubiquitous across the Internet, and we no longer need to rely on centralized social media platforms to distribute and monetize our content.

 

We are transitioning into the Web 3.0 era as more blockchain services and decentralized applications (DApps) come online. For example, any website that requires you to “connect a wallet” to use its services is part of this Web 3.0 ecosystem. The blockchain layer of the internet allows you to carry your identity and assets wherever you go on the Internet. And Web 3.0 is the base layer for the Metaverse.

 

NFTs, which are digitally-scarce, one-of-a-kind blockchain tokens, are what ultimately add value to Web 3.0 and the Metaverse. An economy based on limited supply and demand is what motivates people to form a market around goods. Digital goods inherit that characteristic through blockchain tech and NFTs. And of course, cryptocurrencies are the native currencies for trading these goods. 

 

Early 3D Metaverse platforms such as Decentraland and The Sandbox utilize NFTs in the form of virtual real estate and in-game items, effectively encoding the virtual realm with finite land and resources that will follow the same supply and demand curves as physical reality.

 

 

Overall, NFTs and crypto are creating an “Internet of value” that will incentivize people to further participate in activities going on in virtual environments.

 

Gaming, VR, and blockchain converge

Gamers are no strangers to taking part in digital economies and immersing themselves in 3D virtual environments. So it’s no surprise that Metaverse tech such as VR is first finding adoption within the gaming industry. In addition, video games have already pioneered the idea of massively multiplayer online (MMO) structures, which allow people from all over the world to connect and cooperate in virtual spaces. Ultimately, the Metaverse will be one giant MMO with an economy that anyone can participate in, and gamers will be the first adopters of these spaces.

 

VR hasn’t yet taken off to the point of mass adoption. Right now, most games and 3D virtual environments are experienced on 2D screens. But as VR technology gets better, people will see the practical applications it has. Most complaints people have about current VR tech are the bad graphics quality, the price, and the lack of mobility. It’s mostly a niche market at the moment, but over time the graphics will get better, the price will come down, and they will be less clunky and energy-consuming. 

 

Likewise, there are very few Metaverse games that are actually playable, with the aforementioned Decentraland and The Sandbox being the best examples for now. But even those games leave a lot to be desired in terms of usability and features. There are some exciting things you can already do, but overall they feel like beta releases. However, as Metaverse games receive more attention, they will likely receive more funding, which means better production using state-of-the-art technology. One high profile collaboration has been between Enjin and Microsoft to help foster blockchain-based gaming mechanics into existing franchises. 

 

Once VR tech has advanced sufficiently, we’ll be able to immerse ourselves in realistic 3D virtual environments for a low cost. Second, more video games — particularly the big franchises like World of Warcraft, for example — will need to adopt blockchain technology allowing for in-game items to be part of a larger digital economy through NFTs and cryptocurrencies. And lastly, the general public will start to see how they can extract value by participating in a digital economy, and that 3D virtual worlds aren’t just for gaming, but for connecting and productivity.

 

The Metaverse platforms that we see today are just early examples of what will be possible in the coming decade as these trends are taken more seriously.

 

The fully realized Metaverse

Fueled partially by the COVID-19 pandemic, people are becoming more accustomed to shopping and connecting with others online. The Metaverse takes this to the next level and adds 3D virtual environments and digital scarcity that an economy can be built upon. Gamers will likely pioneer the transition into the Metaverse while the masses follow behind as they realize the practical use cases beyond gaming.

 

Here’s a possible future scenario:

 

In the chill of the early morning, you slowly stir to life, stretching your muscles as sunlight filters in through your window. As you initiate your daily routine, the familiar echo of reality takes a backseat to the enthralling digital adventure you are about to embark on. You cast off the ordinary trappings of your daily life, replaced with your VR headset, your personal gateway to the endless expanse of the Metaverse.

Before your eyes, a grand panel of character selections unfurls. Like a chameleon, your digital identity is fluid, evolving to match your professional or personal engagements. Whether you choose to mirror your physical self or assume a completely different persona, your avatar is an extension of your own creativity and self-expression. Each nuance, each piece of apparel and accessories, is an NFT you’ve carefully handpicked from the boundless digital bazaars of the Metaverse. Not mere digital trinkets, these tokens represent unique pieces of value, each carrying their own distinctive digital footprint and resell potential.

Perhaps, if your virtual investments have proven fruitful, you begin your day in an architecturally stunning digital mansion constructed from real estate NFTs. Each corner of this cybernetic abode is adorned with NFT artifacts, collected and curated over time, creating a unique expression of your digital self.

Traversing the boundless terrain of the Metaverse, you could zoom across this fantastical landscape on your NFT vehicle, bike, or scooter, or, with the flick of a crypto coin, teleport to your destination. On your journey, you might swing by a cozy coffee shop that synchronizes with your physical reality, instructing a Postmates drone to drop off a freshly brewed cup of joe at your doorstep IRL.

You enter your professional sphere, a digital agency designing innovative billboards for global corporations. Here, colleagues from across the globe converge, their creative avatars filling the virtual space. Thanks to blockchain “salary streaming,” your payment ticks up in real-time, marking each minute of your labor with tangible reward.

After the day’s work, the Metaverse transforms into a vibrant playground. You might swap your attire for something more casual and join your friends at an NFT film theater, housing rare digital productions exclusive to a privileged few. Or, you might visit an art gallery, immersing yourself in interactive NFT art that responds to your presence, creating an entrancing, dynamic experience.

Or, perhaps the siren call of a pulsating nightclub draws you in, where gravity can be switched on and off like a light, and the DJ spins songs encapsulated in NFTs, their immersive visuals undulating to the beat. The entry to such a tantalizing club demands proof of membership, manifested in the form of an NFT.

Maybe you opt for an adrenaline-fueled venture, joining your comrades to raid a game world riddled with legendary NFT treasures. These quests could yield items of significant value, sellable for cryptocurrencies both within the Metaverse and in the physical world. Some skilled gamers have even turned this pursuit into a lucrative career.

Wherever you roam, your public inventory follows, showcasing your digital wealth and affiliations for all to see. Spotting a rare NFT avatar like a member of the Bored Ape Yacht Club is akin to spotting a celebrity, signaling a high-status individual who holds a golden key to the most exclusive corners of the Metaverse, such as The Swamp Lounge.

Thus unfolds another thrilling day in the Metaverse, where every moment is woven with innovation, excitement, and endless possibilities. You traverse the fine line between fantasy and reality, and the line becomes increasingly blurred with each digital sunrise.

 

Mixed Reality

So far, I’ve mainly discussed the Metaverse as if it will be solely accessed through fully immersive VR tech, but the Metaverse can be overlayed across physical reality as well. For people who would like to access the Metaverse without total immersion, the advent of augmented reality (AR) wearables will allow the Metaverse and the real world to be experienced simultaneously. Putting on AR glasses, for example, can display graphical images over physical structures or people, showing information related to their status in the Metaverse. While wearing your AR glasses, looking at the person standing next to you on the subway train could show them wearing their super rare NFT outfit even though they are dressed casually IRL.