Why will you be hooked on a blockchain in the metaverse?

You may see the metaverse as a collection of linked virtual worlds, similar to the internet but accessible via virtual reality. This is generally right, but the metaverse also has a key, if a little mysterious, aspect that will distinguish it from today’s internet: the blockchain.

Web 1.0 was the information superhighway of linked computers and servers that you could search, explore, and inhabit, generally via the platform of a centralized firm — for example, AOL, Yahoo, Microsoft, and Google. Web 2.0 was defined by social networking sites, blogging, and the monetization of user data for advertising by centralized gatekeepers to “free” social media platforms like Facebook, Snapchat, Twitter, and TikTok around the turn of the century.

Web 3.0 will serve as the metaverse’s basis. It will be made up of blockchain-enabled decentralized apps that will support a user-owned cryptocurrency and data economy.

Decentralized? Blockchain? Crypto-assets? We can describe the technologies that will enable the metaverse as scholars who study social media and media technology.

Bits ownership

Blockchain is a technology that creates a permanent record of transactions, usually in the form of a decentralised and public ledger. The most well-known blockchain-based cryptocurrency is Bitcoin. When you purchase bitcoin, for example, the transaction is recorded on the Bitcoin blockchain, which means the information is spread to thousands of computers all over the globe.

It’s exceedingly tough to deceive or manipulate this dispersed recording system. In contrast to conventional banking records, public blockchains like as Bitcoin and Ethereum are transparent – all transactions are visible to anybody on the internet.

Ethereum, like Bitcoin, is a blockchain, but it can also be programmed using smart contracts, which are blockchain-based software routines that execute automatically when certain conditions are satisfied. For example, you might use a smart contract on the blockchain to establish your ownership of a digital asset like a piece of art or music that no one else can claim on the blockchain — even if they save a copy to their computer. Crypto assets are digital items that may be possessed, such as money, stocks, and artwork.

On a blockchain, non-fungible tokens include artwork and music (NFTs). Non-fungible objects are one-of-a-kind and cannot be replaced, in contrast to fungible items such as cash, which are interchangeable and valued the same.

Importantly, you might use a smart contract to declare that you are ready to sell your digital painting for $1 million in ether, the Ethereum blockchain’s native currency. When I click “yes,” the artwork and ether are transferred to us on the blockchain automatically. There’s no need for a bank or third-party escrow, and if either of us had a disagreement about the transaction – say, if you claimed I only paid $999,000 – the other could simply refer to the public record in the distributed ledger.

What does the metaverse have to do with blockchain crypto-assets? Everything! To begin, you may use the blockchain to possess digital assets in a virtual environment. You’ll not only possess that NFT in the actual world, but also in the virtual one.

Furthermore, the metaverse isn’t being constructed by a single organisation or corporation. Separate organisations will create different virtual worlds, which will eventually interconnect to form the metaverse. People will want to carry their belongings with them when they travel between virtual worlds, such as Decentraland’s and Microsoft’s. The blockchain will confirm evidence of ownership of your digital items in both virtual worlds if two virtual worlds are compatible. Essentially, you will be able to access your crypto assets as long as you can access your crypto wallet inside a virtual environment.

Remember to bring your wallet

So, what are you going to store in your cryptocurrency wallet? In the metaverse, you’ll certainly want to carry cryptocurrencies. Your metaverse-only digital items, including as avatars, avatar apparel, avatar animations, virtual decorations, and weaponry, will be stored in your crypto wallet.

What are people going to do with their cryptocurrency wallets? Shop, among other things. Traditional digital items such as music, movies, games, and applications will be available for purchase, just as they are presently on the internet. You’ll be able to purchase physical-world products in the metaverse, as well as examine and “hold” 3D versions of what you’re buying, which might help you make better judgments.

Also, much as you can carry your ID in your traditional leather wallet, crypto wallets will be linked to real-world identities, which may make transactions that need legal verification easier, such as buying a real-world vehicle or house. You won’t have to remember login credentials for all the websites and virtual worlds you visit since your ID will be connected to your wallet. Simply connect your wallet with a click and you’ll be signed in. ID-linked wallets will also be handy for regulating access to sections of the metaverse that are limited to people of a certain age.

Your crypto wallet might also be connected to your contacts list, allowing you to transfer your social network data from one virtual world to the other. “Come join me in FILL IN THE BLANK-world for a pool party!”

Wallets may be linked to reputation scores in the future, which may decide your rights to broadcast in public locations and connect with individuals outside of your social network. If you behave like a destructive misinformation-spreading troll, you risk damaging your reputation and having the system diminish your sphere of influence. This may provide an incentive for individuals to act appropriately in the metaverse, but platform developers must make these systems a priority.

Business is big

Finally, if the metaverse is worth money, businesses will want to participate. Although the decentralised structure of blockchain may lessen the need for gatekeepers in financial transactions, businesses will still have a plethora of revenue-generating options, maybe even more than in contemporary economies. Large platforms will be provided by companies like Meta, where people will work, play, and socialise.

Dolce & Gabbana, Coca-Cola, Adidas, and Nike are among the major companies that have entered the NFT market. When you purchase a real world item from a corporation in the future, you can also get a related NFT in the metaverse.

When you purchase that sought name-brand dress to go to a real-world dance club, for example, you may also become the owner of the crypto version of the same garment that your avatar may wear to the virtual Ariana Grande performance. You could also sell the NFT version for someone else’s avatar to wear, just as you could sell the actual clothing secondhand.

These are only a few of the numerous ways that metaverse business models will likely intersect with real-world business structures. As augmented reality technology become more prevalent, such instances will get more complicated, further combining features of the metaverse with the actual world. Although the metaverse as a whole hasn’t arrived yet, technical underpinnings such as blockchain and crypto assets are rapidly being built, laying the groundwork for a seemingly omnipresent virtual future that will eventually arrive in a’verse near you.