Disentangling crypto from the metaverse
Cryptocurrencies and the metaverse are closer than technologists and science fiction novels. As the metaverse blossomed during discussions the cryptocurrency scene loosed their tentacles and grappled the burgeoning trends with a vice-like grip, and jettisoned a flotilla of products that espouse their connections.
Want to build a house in the metaverse? Hire a ‘metaverse construction company’ that can build the virtual home of your dreams, minted to the blockchain. How about decking yourself with a handbag, freshly marked on the same chain to verify the unique ownership? Don’t worry, a finance-hungry dev group is ready to sell you a fashion show of accessories for your every whim and context.
I have seen all of these projects shoot into my inbox, such as one where you can celebrate Valentines’ Day with your own unique NFT that can be used in the metaverse. All of them are tapping into the growing understanding and conversations around spatial computing, with products and services that espouse their deep and intimate connection with the trend. The only problem is that the metaverse doesn’t actually exist yet, and the metaverse is capitalising on perceptions rather than facts.
When I talk about the metaverse, I primarily talk about a wider ‘macro-metaverse’ where it is interoperable with multiple worlds. If the handbag I previously mentioned can be used in a Fortnite concert, or while skiing down the Alps with Mario at your side, then the metaverse is truly here. That transfer of ownership, that works across a wider net, is one of the signatory elements of the metaverse.
Nothing we have today matches that definition. At best we have a range of micro-metaverses, where all of the virtual worlds are as closed off to each other as the Earth is from Andromeda. No items and assets can pass between one another, as transactions and items are blocked from each other and communities can only grow inside their high walls. Cryptocurrency professionals serve items that can work in these micro-metaverses, but ownership cannot be moved between these worlds at all. The handbag is locked within locations like VRChat, without being seen by people that relax in Decentraland.
Worse, the purchase of an asset linked to the blockchain, such as an NFT, only really signify the true owner of said item. In theory, anyone can download it for themselves, unless the virtual world is so embedded with a blockchain network that it can block users from using items that they do not own. Such systems are rare, and can lock the users even deeper into their own world and, in tandem, bring them deeper in their systems. Cryptocurrency professionals would respond that a signage on the blockchain represents ‘true’ ownership, a higher echelon of exclusivity to be proud of. But the sense of status is a fabrication locked within a singular group, a self-perception that reinforced itself via group conversations with little substantiation.
While current use-cases border on absurdity and group-think, a bright future may come. As the metaverse develops, we need a system to verify ownership of digital items, as a basic principle to ensure the economics of the virtual world can function. A decentralised blockchain to verify the ownership of, say, a sofa, ensures that the item has value and people can pay for them. If enough micro-metaverses subscribe to the same system, then there can be a place where items can transfer between worlds and can work in many ways. If you really want to use the sofa to skip down with Mario, then you can.
Until the hypothetical scenario arrives, however, the will continue to see rampant fraud in the NFT space. The most compelling element of NFTs is that sense of exclusivity of being part of a club or project, and the largest projects – such as the Bored Ape Yacht Club – can transcend social media and hit mainstream mania. A fully-formed macro-metaverse with the same principles will be powerful. But until then, the promises of NFT ownership rarely matches its true value in reality.