Metaverse, NFTs and crypto are taking more and more space in daily agency activity, accompanied by a lot of interest and sometimes more confusion. Let’s try to demystify the topic, starting with some simple definitions and by separating what is technology from concepts among the main terms.
The metaverse is a concept, and the most accepted definition is that it is a virtual, persistent and connected world.
- Virtual means as opposed to physical.
- Persistent means is that it’s open 24/7 and the world continues to exist and if you are there or not.
- Connected means people can interact with or within it.
There are plenty of these virtual, persistent and connected worlds. Second Life was among the first, created a few years ago. Fortnite, Roblox and Decentraland also share those characteristics.
An NFT is in fact a 'technology'. It is a technology that makes it possible to authenticate digital goods or services. Where before a digital file could be copied infinitely, lowering its value. NFT blockchain technology can now certify the property and transactions through a line of code that is installed and unalterable. This technology, is creating suddenly new way to monetize digital assets, creating new economical models and businesses.
AR and VR (virtual reality and augmented reality) layer.
AR or VR are simply ways of accessing the metaverse through technological fields, to which we could also include the Internet of things. You can access the metaverse today by looking at a screen or by having an VR headset in front of your eyes.
Intrinsically, with these things working together, the metaverse is a new world where we can connect with new digital assets that working in an autonomous way without intermediaries.
So what has changed recently, and why the hype?
We have now more cloud and connection capacity, advanced infrastructures, calculation power and availability of virtual reality headsets that will allow these worlds to have more than one defined experience but also a much better visual experience.
Sandbox or Roblox are persistent and interactive worlds created by a group of creators. But the world does not move per se. You actually download the walls of those worlds to your computer and then you move within it. Decentralisation includes blockchain technology as well as smart contracts, open-source platforms, and the possibility of a self-sovereign digital identity.
And this is what we start to call Web 3.0, a decentralised world, based on blockchain, crypto and NFTs. Web 3.0 is when we can give users the ability to create elements within a decentralised world themselves and monetise it to smart contracts between you and the potential buyer. For example, the owner of these worlds can sell you a piece of its digital land. Once you get the land, you can create your own goods or services through NFTs and monetise your own activity in turn.
So in the metaverse world concept, the money are crypto currencies and the goods or services are NFTs.
It is important to also differentiate that NFT have many more applications outside of the metaverse, such as 'digital collectibles', which have literally propelled a new genre in the digital art space that is booming. Now, the “collectibles” market that didn’t grow that much since the Panini sports cards or Pokemon era is having a second life through companies like Sorare or Dapper Labs.
3. Mass participation
Now all the tech giants are stepping into the breach and it is almost vital for them to do so. Platforms like Facebook (Meta), Google, Tencent, Alibaba and Amazon have business models that rely on their capacity to get people's attention. Now most of that attention is being captured on mobiles phones and soon will be through the metaverse(s).
That battle of the maximum share of attention will only become more and more difficult as online time demands are filled by gaming, streaming and social media. Brands looking to capture the attention of the new generation will need a presence in the metaverse, bei it through digital goods, gaming with a new play-to-earn model, entertainment, digital art, or a yet to be defined experience.
One thing remains certain. Brands will need to be where consumers are spending time.
Ramzi Chaabane is managing director at Stink Studios.