A Metaverse Guide for Meatbags.
If you’ve been reading the tech and blockchain headlines, it has been impossible to avoid “the metaverse”. Large corporations like Roblox and the company formerly known as Facebook jumped all in to create their versions of it. Crypto and NFT enthusiasts are trying to build it. But there isn’t much of a clear definition behind it.
The concept of the metaverse gained notoriety through dystopian science fiction novels, Neal Stephenson’s Snow Crash in 1992 and then later in Ernest Cline’s Ready Player One in 2011. Snow Crash features a version of America that is dominated by large corporations (quite foreboding) and a virtual world where people have 3-D avatars. Important to note, however, these aren’t the only instances in science fiction involving the metaverse. In both novels, the expansive virtual reality world also generates real value in the outside world.
Despite the metaverse being a feature of dystopian societies run by megacorporations, Mark Zuckerberg who runs the megacorporation recently renamed “Meta”, is committed to building a metaverse. While other gaming companies have long had online social worlds, such as Second Life, the improvement in video game graphics is ushering in new and far more immersive platforms.
Unsurprisingly, many people don’t want large corporate entities controlling the metaverse, they want to have a say in how it all works and functions. The pathway towards building a decentralized metaverse involves building virtual worlds using NFTs and blockchain technology. This way in-game items have value across virtual worlds, and people using different games can actually vote and govern how they continue to grow and develop. Virtual worlds like Decentraland are building a universe that will contain many different games and social events.
Can NFTs and decentralized organizations be key for the metaverse going forward?
Maybe yes and maybe no. There is no single working definition of the metaverse and the goodwill built up through Decentraland and other independent communities sprouting out across the blockchain might be co-opted by Facebook and other companies to build out their products. In some sense the metaverse is a vague term that can be applied to any product in development, building hype, and retaining relevance. Would anyone care if Facebook announces a 3-D version of social media?
The metaverse is complicated, intelligent, misguided, useless, the future, or a corporate dystopia depending on how it’s defined. For science fiction fanatics, it’s also problematic that corporations are following the example of dystopian fictional worlds.
The metaverse might or might not already exist depending on the definition you’re using.
Meta (aka Facebook 2.0), offers us a definition that happens to sound a lot more like a new and improved version of social media:
“The Metaverse is a set of virtual spaces where you can create and explore with other people.”
Meta, Building the Metaverse
And according to venture capitalist Matthew Ball who wrote The Metaverse Primer:
“The Metaverse is an expansive network of persistent, real-time 3D worlds and simulations that support continuity of identity, objects, history, payments, and entitlements, and can be experienced synchronously by an unlimited number of users, each with an individual presence.”
Matthew Ball, The Metaverse Primer
Both of these definitions leave a lot to be desired and they lead to a number of new questions.
- Would the metaverse be one sprawling virtual universe, like Decentraland?
- Will it involve multiple Decentraland-like platforms?
- What kind of interactions are meaningful or sufficient enough to confer metaverse status?
Of course, there are many more vague definitions which would only further muddy the waters here. Right now, the metaversal concept depends on your preconceptions and biases. Without any agreed-upon spaces functioning as a metaverse in the current moment, it remains challenging to define.
Janet Murray, a Professor at Georgia Tech offers this slightly more cynical take in The Archeology of Virtual Worlds:
“When people talk in intoxicated terms about the metaverse, they are imagining a magical Zoom meeting that has all the playful release of Animal Crossing.
But if there is one thing we can all learn from this pandemic, it is that reality is reality, and we cannot generate an alternate media-scape in which we can hide from the mortal perils of embodiment.”
Why is All This Happening Now?
With everyone working from home, unemployed, or facing the existential dread of the next pandemic combined with the coming climate collapse, people are stressed and they are spending more time online and in digital spaces. This might be a little bit of an understatement.
These are a few of the factors influencing the changes we’re now starting to see:
The Metaverse looks like it’s going to be very profitable.
Like the worlds of many dystopian science fiction novels, corporations like Amazon and Facebook have monopolies and GDPs that rival nations. Single entertainment entities like Disney have bought up so much intellectual property that it made the Marvel Cinematic Universe possible. With everyone looking to capitalize on the next extended product, full of exciting crossovers, entertainment companies and social media look to take advantage.
Video games are improving.
Arguably, some gaming companies have already developed a metaverse. This includes the world of Minecraft, Cyperpunk 2077, and even Fortnite. Gaming companies are focused on integrating social aspects into their games. It’s no surprise that people are still playing certain video games even years after their release. These games focus on bringing entertainment value as well as building a platform where people can make friends while playing. With everyone stuck at home, more people are inevitably drawn to gaming.
NFTs are here to stay.
For better or worse, massive platforms like NBA Topshot have made it easier than ever for tens of thousands of people to enter this ecosystem. NFTs like Cryptopunks regularly sell for millions of dollars. Many legitimate NFT projects are including 3-D avatars and metaversal applications into their developmental roadmap.
People like NFTs and so far they’re willing to spend a lot of money on them. Rather than just serving as a tool for speculation, some projects want to enable their NFTs to function across different games and platforms, or even to serve as a 3-D avatar and entry to a whole new social world.
The Metaverse as it Exists on the Blockchain Today
Let’s dive right into the most popular and profitable metaversal worlds on the blockchain (as of October 2021). No doubt that within a year or two, this list will look a lot different.
Decentraland allows users to explore a virtual 3-D world using NFT avatars. Since it wasn’t created by a social media or gaming company, it is not controlled by a central entity. It allows users to buy land, lease it, as well as rent and monetize different types of content. Importantly, it allows NFTs to be used across different games.
To quote a strange whisper from the movie Field of Dreams: “If you build it, they will come.” That’s the philosophy of Decentraland, which provides a place for different types of developers to gather and build-up games, applications, and worlds. The native token for this ecosystem is called MANA and it allows people to participate in the governance of Decentraland.
Featuring Snoop Dogg as an eager early adopter, The Sandbox is another Ethereum-based 3-D world, that isn’t controlled or owned by a social media or gaming company. It allows users to participate within the world using avatars as well as create, sell, and buy various NFTs. Virtual properties called LAND can be rented and your NFTs can be monetized using SAND. There are currently 40 games in development and more than 15 teams and studios involved in creating the games for the world.
Note as of this writing none of this has been released.
The Enjin multiverse is governed through the native Enjin token. The developmental environment makes it easy for partners and companies to create new games inside of the multiverse. Using Ethereum-based NFTs, different objects can be used and monetized across different games inside of the Enjin multiverse. Enjin has also built partnerships with many traditional gaming and technology companies, cementing their spot as one of the leaders in the blockchain metaverse.
Investing in the Metaverse
To invest and engage within the metaverse, you’ll need to decide which definition fits and best and whether you believe this will become a major part of our lives moving forward. Virtual reality and augmented reality had a lot of hype decades ago, but never became integral parts of most of our lives. The metaverse will need a solid, easy-to-use application to take this next step.
Ways to Invest in the Metaverse Today
With all this in mind, there are a few different ways you can invest in all this potential.
- Start by finding a project you like and believe in.
Don’t invest in anything that you don’t like simply because you think it will be worth a lot of money to someone else later on. It’s challenging to determine what will succeed and with many unscrupulous developers looking to make a quick buck, some projects will never deliver. If you like an NFT that’s part of the metaverse, learn about how it works and why people like it.
- Participate in the communities behind decentralized metaverses.
Don’t invest blindly, instead check out the Discord communities for Decentraland or Sandbox, or Enjin online. Here, you can figure out what kind of community is backing the project and even ask questions directly to some of the developers. If you like what you see, consider buying some of the governance tokens before going all in.
- Buy virtual real estate.
Virtual real estate and land are a limited commodity. If you believe that a certain project will take off, the land will also appreciate as you’ll be able to rent the space to other gaming companies and networks.
There are of course technical risks and challenges that can make it hard for a metaverse to succeed. Most of the projects so far exist on the Ethereum blockchain using a specific set of rules, called ERC-1155, to allow these tokens to be used across different games and ecosystems. But it is more challenging to bridge the gap with NFTs built in Solana and elsewhere. Here are a few challenges emergent from this space.
How do game developers make rules for the function of in-game objects that come from a different ecosystem?
If I have an NFT sword to use in one adventure game, it is unclear how its attributes would transfer into another action game. It is relatively simple for aesthetic skins and avatars, but with more functional items, it gets more complicated.
When NFTs from other blockchains are brought on, is a duplicated object created and bestowed upon the user? Will the user be required to upload it themselves?
This process can be technically fraught and tricky, especially since the actual data behind many NFTs is not encoded using the same computer language.
Can the different metaverses cooperate in a meaningful manner?
If everyone is using a different metaverse, will any of them succeed? Consequently, if everyone is stuck within a few specific metaverses, perhaps it will build another monopoly, like Facebook has over the social media landscape.
Will enough people use these worlds to make the metaverse take off?
Many people don’t care for the metaverse. Will there be enough uptake from the next generation to finally make it happen, or will it go by the wayside like Virtual Reality, Segways, and liveable wages?
Cynically, the Metaverse comes down to Facebook’s rebrand and money grab to create social media without calling it social media.
It might be something that already exists across gaming worlds, where players can interact with each other in real-time and play various minigames.
Crypto and blockchain enthusiasts are also trying to build the metaverse, but in a decentralized manner where the people who use the metaverse will govern its rules and development.
After reading many vague definitions, it’s clear that the metaverse is whatever you want it to be. This ambiguity also applies to investing in different types of metaversal worlds and applications, and also allows anyone to use the metaverse to hype up their product.
But the metaverse isn’t a sure thing. There are plenty more challenges left to overcome, thus investing in the metaverse will be a personal decision. Do your own research as always and of course, don’t invest money you can’t afford to lose simply to speculate: that could be a recipe for financial disaster.
Using an Ethereum-based standard, worlds like Decentraland and The Sandbox are selling virtual real estate that can be developed into games and applications. The NFTs can be transferred and used across different worlds and games within these metaverses. You can even use an NFT you bought in Decentraland inside of The Sandbox because of this Ethereum standard. But there are plenty of other blockchains with NFTs and it isn’t clear how they’ll integrate into these worlds.
The simplest rule for investing in the metaverse might just be figuring out if you actually like the application. Check out the Discord, the developers, the applications and watch some interviews. From there, you can invest in governance tokens that give you a say within the world’s community. Then if you’re still convinced, land will likely prove to be a valuable commodity that you can rent and lease out to developmental studios.