Metaverse After the Hype – 4 Bold Question

The word “metaverse” is very vague. Experts who are enthusiastically uniform about metaverse after the hype, and unanimously perceive the metaverse, still hugely differ in its basic characteristics and the purpose for which it exists. Together with Ekaterina Smirnova, Digital & Analogue Partners, we answer the most relevant questions.

An exercise for the reader: to understand how wide and varied this term can be, imagine the following exercise: whenever you read the word “metaverse” in a sentence, substitute it with “cyberspace,” and 90% of the time, the meaning will remain unchanged. This is because the metaverse is about more than just one kind of technology. The metaverse is a spectrum of changes to how we relate to technology.

If you think as a whole, the technology portion of the metaverse may also include augmented reality (AR) and virtual reality (VR). However, even these technologies are not mandatory.

That’s why the game Fortnite has already started calling itself the metaverse: in this world, it is possible to visit a PC with nothing special, even a game console or a phone.

At the same time, approaches to the definition of the metaverse may be different, but at least some characteristics exist where the opinions of the researchers agree. Metaverse is the shared virtual space that includes the following elements and characteristics:

  • virtual worlds in which people can interact with each other and with digital objects in real-time;
  • constancy and synchronicity: the metaverse is always on and exists continuously;
  • social interaction of users using immersive technologies and creating the effect of presence;
  • digital assets that users can create, buy, sell, and invest in the metaverse;
  • augmented and virtual reality (AR/VR).

Unanswered questions:

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At the moment, it is yet unknown which of the features within the metaverse is going to prevail. Now, the four open questions will be presented, questions to which the answers will play a determining key role in giving the final shape to the metaverse. Singular or plural:

The metaverse as it stands does not have a single entry platform into it. It constitutes a succession of separate platforms, each controlled by its respective owner. Among them were Horizon Worlds by Meta (a company recognized as extremist in the RF), Fortnite by Epic Games, and Roblox by Roblox Corporation.

None of these platforms were able to include all the features of the metaverse and its philosophy. None of the above up until now can claim to be the one, the sole and full value of the Metaverse.

BIGTECH again:

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The Metaverse is part of the digital world.

And, like every other digital platform, it is vulnerable to the ravages of the network effect: value increases with more users and developers tending to interact with a platform. That way, it may bring to life some of the great and powerful platforms among digital giants that we already get used to: Google, Apple, Facebook (Meta is defined as an extremist organization on the territory of the Russian Federation), Amazon, and Microsoft.

That increases the probability even more significantly, as only BigTech companies could afford multibillion-dollar investments in metaverse infrastructure development, with paramount input concentrated on the creation of virtual and augmented reality glasses capable of a fundamentally new level of immersion into another reality.

This goes against the fundamental principles on which the metaverse is based: decentralization, user independence, self-administration of digital holdings, and personal data. To add to this, an absolute advantage on the part of BigTech may serve only to further stoke public concern over privacy, security, and content moderation. This leaves uncertainties as to which IT giants will rule the roost in the metaverse.

Will the metaverse be interoperable?

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The main characteristic within the metaverse is that of interoperability between the users in the transfer from one virtual world to the other, with their assets in each world: from digital clothing to digital currency.

This is, at the same time, a fairly complex problem, the solution to which can only be brought about by the development of some common standards and universally accessible protocols for all subjects of the markets. The leadership in the metaverse space from Meta (a company considered to be an extremist organization in the Russian Federation) to Epic Games are all incredibly loud in urging collaboration and the development of open standards. Companies at the same time see the difficulties of such an approach: it will require them to make friends and not engage in the usual cut-throat competition. In other words, IT giants will have to transition to co-opetition.

What is the role of blockchain?

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Today, the place of blockchain technologies in the metaverse is something entirely clear. Ideologically, blockchain fully corresponds to the metaverse.

Decentralized, smart-contracts-enabled, and user-friendly, suitable for a broad range of purposes, including but not limited to in-app purchases without expensive banks and app platforms charging their own. NFTs are an ideal tool for recording ownership of digital and real assets; Ideally, this takes the form of governance for the metaverse of the platform based on user input in decentralized autonomous organizations (DAOs).

Active use is a kind of universe: Decentraland, as an example. It has active NFTs in use, a cryptocurrency MANA for control, and DAO.

This means the share of people actively and skillfully using blockchain technologies is already quite small, not to mention the part of those who take the first place in different fields of the metaverse. Whether blockchain will be a fundamental part of the metaverse or remain a rare exception remains to be seen.

Metaverse After the Hype:

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Just as it happened with each new technology, after the first wave of overhype, interest in the metaverse somehow subsided, but it allowed us to understand truly viable use cases for the technology. Major world corporations already make active use of the Metaverse in digital marketing for a new way of exciting the audience with interactivity with the brand and its product available for purchase here and now in a virtual space.

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