An alternative world: 4 things to know about metaverse, next tech revolution

What is the metaverse?

Metaverse, a term first coined in science fiction, is a combination of the prefix “meta”, meaning beyond, and “universe”.

It refers to shared virtual worlds where land, buildings, avatars and even names can be bought and sold, often using cryptocurrency. In these environments, people can wander around with friends, visit buildings, buy goods and services, and attend events.

The concept has surged in popularity during the pandemic as lockdown measures and work-from-home policies pushed more people online for both business and pleasure.

The term covers a wide variety of virtual realities, from workplace tools to games and community platforms.

Many of the new platforms are powered by blockchain technology, using cryptocurrency and non-fungible tokens (NFTs), allowing a new kind of decentralised digital asset to be built, owned and monetised.

Two distinct platforms

The metaverse can be broadly broken down into two distinct types of platforms.

The first centres around building a blockchain-based metaverse, using NFTs and cryptocurrencies. Platforms like Decentraland and The Sandbox allow people to purchase virtual parcels of land and build their own environments.

The second group uses the metaverse to refer to virtual worlds more generally, where people can meet up for business or recreation. Facebook Inc announced in July it was creating a product team to work on the metaverse.

Roblox, Fortnite and Minecraft, gaming platforms where users can compete and collaborate in games as well as create their own, fall into this category.

Follow the money

While many metaverse platforms provide free accounts for people to join, people buying or trading virtual assets on blockchain-based platforms need to use cryptocurrencies.

Several blockchain-based platforms require Ethereum-based crypto tokens, such as MANA for Decentraland and SAND for The Sandbox, to purchase and trade virtual assets.

In Decentraland, users can trade NFT artworks or charge entry to a virtual exhibition or concert. They can also make money by trading land, prices of which have surged over the past few years.

On Roblox, users can make money by charging other users for access to games they create.

Future of the metaverse

It is unclear to what extent a true metaverse, which fully replicates real life, is possible or how long it would take to develop.

Many platforms in the blockchain-based metaverse are still developing Augmented Reality (AR) and Virtual Reality (VR) technology that will allow users to fully interact in the space.

Accounting and advisory giant PwC forecasts VR and AR technologies to deliver a $1.5 trillion boost to the global economy by 2030, compared with $46.5 billion in 2019.