As nonfungible token sales appear reanimated after a nearly two-month dry spell from their apex in May, a particular NFT application is gaining popularity more than ever: metaverses. Metaverses have gained their fair share of media attention lately, with big moves coming from companies like Facebook and Epic games. However, not everyone — even those who have been in crypto for a long time — has caught on to what metaverses are, despite the hype. But as more companies, celebrities and artists venture into the space, it has become another domain that deserves some thorough consideration.
The Metaverse is a network of virtual environments in which people can interact with each other, digital objectsand the physical world through their avatar. While definitions of the Metaverse vary, they orbit around technologies such as virtual reality, augmented reality, digital twins and blockchain. Herman Narula, CEO of Improbable, described the Metaverse as “something more than a game but less than the real world. The metaverse is to virtual worlds as a website is to the internet.”
For weeks, Mark Zuckerberg has been beating the drum for metaverses. The Facebook founder views virtual worlds as the next iteration of human interaction online. Zuckerberg sees Facebook transitioning from a social media firm with a set of connected applications to a metaverse company with a set of interconnected experiences. And its recent move to introduce Horizon Workrooms is a step in that direction. It’s also in a prime spot to run after its metaverse objectives, as it has invested heavily in VR technology for several years.
Another one bursting onto the scene is game and software developer Epic Games. Epic Games, of course, already has something to show for when it comes to metaverses, with the successful virtual concerts of Ariana Grande, Travis Scott and Marshmello that were held inside its flagship game, Fortnite. The $1 billion in funding that it received in April, with an additional $200 million deal from Sony Group, will help it pursue long-term growth opportunities with metaverses, especially as it is already remodeling the future of live events.
Why the Metaverse?
The Metaverse offers a vastly unique experience for everyone. It’s a way for artists to connect with fans more interactively and perhaps individually, which is a step up from the livestream format delivered by artists like Post Malone, Dua Lipa, Gorillaz and many others when the pandemic struck in 2020.
On the other hand, Facebook’s Horizon Workroom is geared toward replacing boring Zoom call meetings with a more interactive environment — a virtual conference room, if you will — for remote workers. Others also see a wide variety of applications that the Metaverse is going to be useful for. Education systems, for one, can benefit by allowing students, particularly in the medical field, to receive simulation training as opposed to just a one-way communication where teachers merely deliver the lessons to the students.
Metaverses and NFTs
The tie-in between metaverses and nonfungible tokens comes from NFTs’ capability to add a certificate of ownership or authenticity to the assets belonging to the digital world. Projects like Decentraland, The Sandbox, Landemic, CryptoVoxels, and SuperWorld involve acquiring a piece of this digital asset, which is primarily virtual land. NFTs help in verifying its uniqueness, and even its provenance.
For instance, Decentraland is based on the Ethereum blockchain and uses ERC-721 tokens called LAND to facilitate trading plots of virtual lands called parcels. This makes each land distinct and helps users establish ownership of a piece of the entire Decentraland real estate. This is built on its consensus layer, which maintains a ledger that tracks the ownership of each parcel.
LAND tokens enable owners to do various things within their digital real estate, like hosting games or experiences, organizing contests and events, or even…
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