As non-fungible token sales appear to pick up again after a nearly two-month dry spell since its peak in May, one particular use case for NFTs is gaining more popularity than ever: metaverses. Metaverses have been gaining media attention lately, with big moves from companies like Facebook and Epic games. However, not everyone (even the most veteran of the cryptocurrency space) has realized what metaverses are, despite the hype they are causing. But as more companies, celebrities and artists venture into this space, it has become another area that deserves further consideration.
The metaverse is a network of virtual environments in which people can interact with each other, with digital objects, and with the real world through their avatar. Although the definitions of the metaverse vary, they orbit around technologies such as virtual reality, augmented reality, digital twins, and the blockchain. Herman Narula, CEO of Improbable, describe the metaverse as “more than a game, but less than the real world. The metaverse is to virtual worlds what a website is to the Internet.”
The metaverse chariot
For weeks, Mark Zuckerberg does not stop beating the drum of metaverses. The founder of Facebook sees virtual worlds as the next iteration of human interaction on the Internet. Zuckerberg sees Facebook as moving from being a social media company with a connected set of applications to a “meta-reverse company” with an interconnected set of experiences. And his recent initiative of implementar Horizon Workrooms it is a step in that direction. You are also in a prime position to pursue your goals related to metaverses, having invested heavily in VR technology for several years.
Another breaking onto the scene is game and software developer Epic Games. Epic, 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 within their flagship game, Fortnite. The billion dollars of financing received in April, with an additional $ 200 million deal from Sony Group, will help you pursue long-term growth opportunities with metaverses, especially as you are already redefining the future of live events.
Why the metaverse?
The metaverse offers a unique experience for everyone. It is a way for artists to connect with fans in a more interactive and perhaps individual way, which is a major advance over the live format offered by artists such as Post Malone, Dua Lipa, Gorillaz and many others when the pandemic began in 2020.
Secondly, Facebook’s Horizon Workroom is geared towards replacing boring Zoom calls with a more interactive environment (a virtual conference room, so to speak) for remote workers. Others also see a wide variety of applications for which the metaverse is going to be useful. Education systems, for example, can benefit from allowing students, especially in the medical field, to receive simulation training rather than one-way communication in which teachers simply deliver lessons to students.
Metaverses and NFTs
The link between metaverses and non-fungible tokens (NFTs) comes from the ability of these assets to add a certificate of ownership or authenticity to native assets in the digital world. Projects like Decentraland, The Sandbox, Landemic, CryptoVoxels and SuperWorld involve the acquisition of a part of this digital asset, which is mainly virtual land. NFTs help verify your uniqueness, and even provenance.
For instance, Decentraland is based on the Ethereum blockchain and uses ERC-721 tokens called LAND to facilitate the trading of virtual parcels. This makes each lot different and helps users establish ownership of a portion of all of Decentraland’s real estate assets. This is based on your consensus layer, which maintains a ledger that tracks ownership of each parcel.
LAND tokens allow owners to do various things within their digital property, such as hosting games or experiences, organizing contests and events, or even renting it out. The same concept applies to The Sandbox, NFT’s second metaverse project in terms of sales to Decentraland.
Download issue # 29 from the newsletter Cointelegraph Consulting fortnightly complete with charts, market signals, as well as fundraising news and recaps.
Metaverses and cryptocurrencies
Cryptocurrencies are the medium of exchange within the metaverse, allowing users to exchange virtual goods. The two metaverses mentioned above allow players to transact with cryptocurrencies. Decentraland’s ERC-20-based token, MANNA, is the legal tender for users to purchase parcels of digital land and SAND tokens for The Sandbox. These coins also give users the opportunity to participate in its development.
Users can use MANNA tokens to vote on policy updates, land auctions, and grants for new developments in Decentraland, while users can use SAND tokens for more or less the same purpose. Furthermore, cryptocurrencies can further open up the possibility of transacting goods from different games or metaverses in interoperable markets.
The growth of metaverses
Currently, metaverses have not reached their full potential, and companies are just beginning to explore the ways they could foray into the space. Facebook and Epic games are just the two most recent examples of big names to jump on the bandwagon. However, companies like Microsoft and Amazon are also getting into the game. Amazon, in particular, is developing a “Amazon Mall” virtual where users can buy and interact with the products they want to purchase. But it is still uncertain, and even unlikely, that they will be compatible with NFTs.
However, NFT sales of metaverses are slowly gaining strong ground against other categories. In the second quarter, its weekly sales exceeded $ 8 million at one point.
Total sales from 2017 to August 2021 amounted to USD 138 million, which is enough to capture a 6.77% share of NFT sales by category. This places the NFT category of metaverses in third place in NFT sales, behind digital collectibles and works of art.
And with more and more well-known personalities and large companies joining the trend, the numbers could well improve before the year is out. The growth of metaverses and NFTs, in general, is unprecedented, especially in 2021. NFT sales in the metaverse are already up 428% since 2020 and have averaged 149% growth over the last four years. SIf this explosive growth keeps pace, it would not be difficult to see sales surpass the USD 120 million in early 2022.
Cointelegraph’s Market Insights newsletter shares our insights into the fundamentals that drive the digital asset market. The newsletter covers the latest data on social media sentiment, on-chain metrics and derivatives.
We also go over the top industry news, such as mergers and acquisitions, changes in the regulatory landscape, and blockchain business integrations. Sign up now to be the first to receive this news. All previous editions of Market Insights are also available on Cointelegraph.com.