With Facebook changing to Meta, which is essentially a holding company of a variety of technological companies and online platforms, the idea of the metaverse has become even more of a reality, or at least a virtual one.
With a social, financial, business, and game environment, more and more people are entering the metaverse, essentially living their entire lives on the internet.
What is the Metaverse?
The idea of the metaverse can best be depicted in the book and movie, Ready Player One. Obviously, this is an amplified version of the metaverse, where everyone lives their lives online. In this online world, people create their own avatar, becoming essentially anything they want to be, despite how they present in reality.
The metaverse is a reimagined internet, built on something called Web 3. Due to the internet being hyper-regulated in recent years, there has been a push to democratize the internet, making it more of an open and free market. This is the purpose of Web 3, where the infrastructure for the metaverse is being created and built to decentralize the internet.
Traditional internet involves going to different places to find the information you need. In contrast, the metaverse simulates a virtual town where your avatar walks around and comes across information like you would in real-time. Because this virtual reality is being created online, businesses focus on virtual market solutions and products.
Cryptocurrency’s Role in the Metaverse
Similarly, cryptocurrency is the financial arm of the metaverse, a decentralized currency with limited regulation. In the metaverse, you will find a virtual space to game, buy property, and hang out with people.
It has created a whole new restructuring of the internet. Due to the connection between both the metaverse and cryptocurrency, and their goal to function outside of the regulation and restriction of the government, crypto is the go to currency for virtual purchases.
It is important to note that although many individuals do accept virtual money via cryptocurrency, it is a very volatile currency that is not as stable as other currencies. Society at large still chooses to deal with government-backed money that has a proven track record, so although cryptocurrency may work in virtual land, it often must be converted into dollars in the real world.
NFT and Online Properties
As a result of these virtual realities, many other virtual assets have been created. A popular asset right now is Non Fungible Tokens (NFTs). These can include things like art, gaming, music, media, events, and virtual fashion. Interestingly, some of the NFTs are quite expensive, with the highest one costing over $90 million dollars.
Another virtual asset that is going for a large amount of real money is virtual properties. Unlike a hard asset or property that would need a property manager, virtual properties only exist in the metaverse. For example, there is a city being created called Genesis City that is equivalent to the size of Washington D.C. Here, 1,100 square feet of virtual space can cost over $200k.
Conclusion
The creation of an alternate/virtual reality is quite an interesting phenomenon. It’s sometimes difficult to fathom that many individuals are investing large amounts of money and capital into a virtual space where the assets are not hard assets. This does not negate the fact that money can still be made through the buying/selling/renting of NFTs and virtual properties.
As people move more of their lives to the online space, it will be interesting to observe how the metaverse will expand and lead to changes in real life.
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