The origin story
It all happens in waves – the Pandemic, the Industrial Revolution, the Evolution of the World Wide Web.
The Web first started evolving in the year 1989. It was still Web 1.0 back then. It was used mostly by companies and corporations, and only experts knew how to actually work with it. Creators were few, viewers were many. It was the most basic form of the web with pages being created only using HTML.
Web 2.0 came about in the late 2000s. This in itself felt like a major level-up, as now, it made content creation widespread and not just limited to companies. It was for communities. The beloved Facebook, Instagram, Twitter exist as a result of Web 2.0. It is the version of the Internet that you and I are familiar with.
Could it get any better? Yes, it absolutely can.
Web 3.0 is the future. It is the future that is happening and still in progress. The focus was shifted to back-end development after years of front-end taking the attention. Blockchain technology is the cornerstone for Web 3.0. It functions on the principle of decentralization where data is not owned by one single entity; it is shared. It is for individuals, rather than just communities. Web3 encompasses Non-Fungible Tokens (NFTs), Decentralized Finance (Defi), Decentralized Autonomous Organization (DAO).
This is where Metaverse comes in. Metaverse is based on decentralization and a creator economy. Web3 and Metaverse have often been used interchangeably. They are linked but are not the same i.e. Web3 forms a cornerstone for the Metaverse but Metaverse includes a whole lot more. Metaverse, on the other hand, can help in the further amplification of decentralization as a process and a solution even in the real world.
Introducing the Metaverse
Metaverse was coined by Neal Stephenson in 1992. Meta means “beyond”, and verse comes from“universe”. So- Beyond the Universe. It is a coming together of the virtual world and the real world that is beyond the existing universe.
Was Stephenson a software developer? No. He was an author who introduced the term in his science-fiction novel “Snow Crash”. It is too soon to accurately and aptly define the Metaverse, but Stephenson’s depiction of the Metaverse is frighteningly close to what has been developing these days.
Metaverse, as apparent in its meaning, has no limits. It is not an extension of a single technology, but multiple. The borders and limits are also always changing (probably every day). It includes Virtual Reality as well as Augmented Reality.
You might have come across Virtual Reality in the gaming space where players put on some special goggles and experience a simulation of a completely different world. They can climb skyscrapers, play tennis, or fight ninjas on Mars, all while being in their living room.
Augmented reality is also similar to Virtual Reality. A very well-experienced example of Augmented Reality is photographic filters that are available on apps like Instagram and Snapchat. PokemonGo was all the rage a few years ago. It’s an example of Augmented Reality in the gaming space. Players would have to actually walk around in the real world to catch Pokémons that are in the digital world on their phones.
Two of the most innovative inventions of this decade come together and still form only a fraction of what is Metaverse.
Other important components of Metaverse are Blockchain tech and ultra-immersive social media. Instead of having just a two-dimensional presence, social media users can have a three-dimensional presence. Instead of having one avatar for each platform, users can create a universal avatar that remains the same on all platforms and is a virtual extension of the user’s real persona. It can also be used on shopping platforms where the avatar can try on outfits before purchasing them.
What implications does Metaverse have on Cryptocurrency and Decentralized Finance?
Have you heard of Decentraland? No, it’s not Disneyland’s new name.
It is a Metaverse project and a virtual destination that runs on blockchain technology where users can buy digital assets like land, avatar wearables, etc. Users can create and monetize their content here. But how does this monetization work?
It works because of crypto! The platform’s cryptocurrency, called MANA, is used to buy all virtual goods. Its market cap stands at $4.09 billion and ranks 31ston the list of cryptos.
The co-founder of a similar Metaverse concept called The Sandbox has said that users spend a huge amount of money in the digital world- hundreds, thousands, and even millions on digital assets. All these transactions take cryptocurrency to a whole new level.
Just like one would use USD or INR in the real world, cryptocurrencies are used in that universe and hold a lot of value in the Metaverse and its allied projects and applications. The way to get your hands on some of these crypto coins or tokens is by a Decentralized Trading mechanism. Cryptocurrency’s value is already increasing in the real world. It is prompt, it is swift, it is transparent and it is decentralized. Now its use in the Metaverse will make its demand only shoot up.
Even in terms of gains, Metaverse-based coins like MANA have gained a lot more than Bitcoin in 2021. Where Bitcoin has gained 100%, Metaverse-related coins are up by nearly 37,000%. But, this could be because of Zuckerberg’s announcement of his foray into the Metaverse. It is too soon to say if this trend will continue in the years to come considering all the developments that will inevitably take place.
The Metaverse can be considered an economic ecosystem. Since the growth in crypto and DeFi has been because of the Metaverse, a new term “MetaFi” is being tossed about by insiders. It covers all the financial tools of the Metaverse. If Metaverse is pushing MetaFi, MetaFi also has the ability to push Metaverse to unprecedented levels of growth and global financial inclusion. The inclusion here will be in terms of digital asset creators, users, traders, gamers – all those who have been shunned by the traditional financial systems. Developers all over the globe can reap its benefits without the inefficiencies of a traditional financial system. Bring DAOs into it, and you have a proper parallel full-fledged economy.
The coming together of Metaverse and NFTs
The increased curiosity of the younger generation in learning about monetization of content is already a big reason for the growth of MetaFi/DeFi. Memes have been the language of GenZ, and the thought of monetizing something as fun and creative as memes has added to the growth of NFTs, and consequently DeFi. NFTs help in creating a social environment in the Metaverse. They are, in a sense, a bridge that connects people to the Metaverse by providing a sense of identity and community. They can help in supporting a project or convey the perspective the user holds in the virtual or real world. They let a person take part in in-game economies when they add value while learning how to play a game.
Metaverse is a massive concept and NFTs are important in building this concept. But the aforementioned inclusion of creators into an economy is possible only if the creator community continues to expand and can set its own economic terms and rights.
The future of everything Metaverse
The concept of a Metaverse has been around for a while. It has been brought to the forefront due to the pandemic and increased virtual interactions. It has gained traction because of Mark Zuckerberg renaming his company to “meta”. His idea of a Metaverse is not yet here; it is still in the making and is still just a vision and a mission. With this announcement and Microsoft executing its biggest acquisition by buying a gaming company for $69 billion, the speculations and hopes for a fully functional Metaverse have been at an all-time high.
But in a sense, the future is already happening. Recently, a South-Indian couple announced that they would be getting married in the Metaverse. The couple also launched special edition NFTs to celebrate the fact that they are the first Asian couple to be getting married in the Metaverse. The collection is said to have 12 NFTs – 11 have the couple’s avatars, and the 12th has the wedding invitation (50 copies available). These NFTs sold out like hotcakes! They were sold and resold multiple times in a matter of minutes. The guests to the wedding are said to be given login ids, through which once they log in, they can choose avatars, walk around the venue, and even give gifts like digital vouchers, GPay transfers, or –wait for it – crypto! The platform hosting it is called Tardiverse and it defines itself as a “Mixed Reality-based Metaverse based on blockchain tech”.
Indian entrepreneurs are also looking to invest in Metaverse-based startups. Shark Tank India saw a developer introducing his gaming metaverse “Loka” to the sharks (investors). Through this, its users would be able to able to interact, game, attend events and even shop on websites like Myntra, Lenskart, etc. The investors invested a total of Rs.40 lacs for24% equity. If experienced and successful businessmen are ready to shell huge amounts to be a part of something that is still small, then there is definitely something big happening in the space.
The boom in web3 and Metaverse can be harnessed to the optimum only major governments refrain from banning cryptocurrency and crypto-trading. Since major corporations like Microsoft are now backing the concept of a Metaverse, it is highly unlikely that governments would do something as extreme as a total ban. But it can be expected that governments will come out with some regulations once Metaverse starts taking proper shape. Usually, regulations tend to suffocate innovation, but the ever-changing nature of the web and its ability to grow in unimaginable directions and scale might make it an innovator’s dream project.