The year 2021 has brought epoch making changes in the digital world with the Metaverse in the forefront captivating the public’s imagination and aiming to integrate our real-world social lives, work, and immersive technology. At the same time crypto, although still evolving, is already playing a key role in the metaverse while promising immense social and financial potential.
Many experts are enthusiastic that the metaverse world based on the blockchain technology will open up to an amazing virtual world that will also facilitate virtual monetary transactions via the crypto economy. With the 3D virtual world being able to spend virtual money it will enable virtual items exchangeable for real economic value beyond the confines of the metaverse.
Tapping into the wider crypto economy and incorporating immersive environments of virtual reality (VR), video games, and social interactions will align the metaverse to become a central element in this fast-growing world while assisting individuals in enhancing their connections, discovering communities, and growing their businesses.
This article further explores how the concepts of blockchain, crypto, and metaverse work in synergy with each other and have the potential to transform the digital world and the Internet.
An overview of the Metaverse, Crypto and Blockchain technology
Metaverse is one of the highest trending terms in the present digital era after Mark Zuckerberg formally renamed Facebook to Meta. Zuckerberg intended to refocus his company around the metaverse allowing people to be online from anywhere, and enabling a more maximalist version of Facebook, spanning social presence, office work, and entertainment.
The concept of the metaverse is quite old however and grew with the evolution of the gaming world. It has been increasingly gaining more recognition in recent times with more and more companies, besides Facebook, recognizing its immense potential and hopping on board the metaverse bandwagon.
To be more precise, Metaverse is a collective network of 3D virtual worlds created by the convergence of virtually enhanced physical and digital reality. Instead of simply browsing the internet with online browsers we can have an immersive experience in the metaverse. Users can wander into the metaverse that mimics the aspects of the physical world using virtual reality headsets, voice commands, eye movements, and feedback controllers. Technologies such as virtual reality (VR), augmented reality (AR), social media, Internet of Things (IoT), 5G, artificial intelligence (AI), spatial computing, and digital currency enhance an immersive experience for different activities such as gaming, job training, education programs, social interactions, remote work, travel, entertainment, and doctor’s appointments. Additionally, the Metaverse also monetizes the immersive experience through crypto trading, NFTs, shopping, and virtual estate transactions.
Blockchain is a technology where information is recorded in a manner that makes it difficult to cheat, hack or manipulate the system. You can call it a distributed ledger technology (DLT) that facilitates the process of recording transactions and tracking assets in a business network. Anyone can view and verify the list of transactions. Blockchain is ideal for delivering information and members can see all details of a transaction end to end such as tracking orders, payments, accounts, production, and much more. The use of a decentralized network and cryptographic hashing makes digital assets such as houses, cars, cash, land, intellectual property, patents, copyrights, or branding unalterable and transparent. Anything can be tracked and traded on a blockchain network as every transaction in this ledger is authorized by the digital signature of the owner. This provision to authenticate the transaction keeps the information on the digital ledger highly secure and safeguards it from tampering.
Today blockchain technology is being used to provide transparency in various sectors such as healthcare records, food supply chains, innovating gaming, and medical research.
Cryptocurrency or crypto is typically decentralized digital money that is based on blockchain technology and secured by cryptography. Being built on blockchain technology, which as discussed is a distributed ledger, it makes crypto transactions between users transparent, immediate, and immutable. Immutable means that any record on the blockchain is there for good and cannot be modified or tampered with, thus making it nearly impossible to counterfeit or double-spend.
Unlike physical money that is carried around and exchanged in the real world, cryptocurrency payments exist purely as digital entries and are stored in digital wallets. The transactions of cryptocurrency data between wallets to public ledgers are secured by encryption. Advanced coding and encryption techniques based on blockchain technology make crypto payments safe and secure.
Decentralization in cryptocurrency means there is no central authority that issues them, making them potentially immune to government intervention or manipulation. Hence it is a peer-to-peer system that doesn’t rely on banks to verify transactions. Anyone can send and receive payments securely without the need for a middleman like a bank or payment processor allowing the value to transfer globally 24/7. Bitcoin was the first cryptocurrency launched in 2008. Some of the other well-known cryptocurrencies are Ethereum, Tezos, EOS, ZCash, and Litecoin
It is obvious that Blockchain is an indispensable technology in the Metaverse world and can aid in the development of a secure digital economy with the help of decentralized cryptocurrency transactions. Let us have a look at some of the benefits blockchain and crypto can offer to the Metaverse world:
Security: Blockchain technology is of great relevance in the Metaverse as it provides secure and safe data storage. Users have direct control over their personal data and there is no fear of being cheated or manipulated by hackers or fraudsters.
Decentralization: A decentralized ecosystem based on blockchain technology will lead to more equitable engagement opportunities for participants in the Metaverse. As thousands of separate nodes will synchronize, ownership will be shared and all participants will be able to access the virtual world.
Smart Contracts: Individuals in the Metaverse can utilize blockchain smart contracts to effectively regulate economic, legal, and social relations between ecosystem participants. Smart contracts automate operations and ensure that operations such as trading and transactions follow a set of predetermined rules. It allows NFT generation and exchange between users easier.
Money Relations: The Metaverse facilitates real-world activities such as socializing, entertaining, and trading in the virtual world environment through the use of crypto assets. Cryptocurrency which is an integral part of blockchain technology functions as a common currency allowing users to command real-world value for their investments as well as perform various kinds of mutual settlements.
