There’s been a resurgence of interest in the metaverse lately since Mark Zuckerberg announced the name of Facebook the company has been changed to Meta Platforms (Meta for short). What exactly is the metaverse? And how do blockchain technology and cryptocurrency fit in? These are important concepts to understand as society and technology continue to transform.
What is the metaverse?
As a rapidly evolving concept, the term metaverse does not have a single clear-cut definition. The name originally came from a 1992 sci-fi novel written by Neal Stephenson called Snow Crash. This fictional metaverse was a virtual 3D world that existed alongside the real world and provided real-time interaction between individuals.
The metaverse is gradually becoming a reality. As a potential successor to the mobile internet, which was a successor to the internet, it is thought of as an:
- Immersive 3D version of the internet.
- Open platform for worldwide commerce, leisure activities, and social interaction.
- Extension of real life that breaks down geographical and socioeconomic barriers.
The metaverse has the potential to grow beyond online gaming and virtual reality into income generation, education, retail, travel, large-scale social gathering, and more.
How does cryptocurrency relate to the metaverse?
Every successful economy needs agreed-upon systems for exchanging assets for goods and services. As an extension of banking, payment rails were developed to transmit payments over computer networks. Today, the most commonly used payment rails such as credit cards, ACH (automated clearing house), PayPal, and Venmo are controlled by governments and financial institutions—the opposite of free and open. Other drawbacks of these payment rails include impractical fees, delays in receiving funds, and geographical restrictions. These methods aren’t well suited for metaverse transactions.
Cryptocurrency is a newer payment rail based on blockchain technology that operates worldwide, outside the control of a central authority, in real time, making it affordable, flexible, and efficient. Blockchain technology moves value around the world independent of any financial institution or government.
How does a blockchain work?
A blockchain is a sophisticated virtual record-keeping system. Instead of operating on a single computer, a blockchain is spread out (distributed) over a network of computers that each maintain an identical copy of the blockchain. These copies are updated across all computers simultaneously as transactions are added to a blockchain. Once a block is updated, it cannot be changed.
Because transactions are permanent, blockchain transactions are secure (difficult to hack). Payments through a blockchain are programmed into the network’s code, which makes them anonymous and automatic. Learn more about blockchains in this blog post.
What are other applications for blockchain technology?
Beyond cryptocurrency, blockchain technology has a variety of potential applications because it is secure, transparent, affordable, and fast. Software development using blockchain technology ensures ownership of assets remains with creators and users. Other blockchain applications where security and accountability are critical include healthcare, voting, identity verification, real estate, patents, stock, and the supply chain (food and other goods).
Where are we today?
The internet took years to evolve into what it is today and the metaverse—with buy-in and collaboration—will continue this evolution. Blockchain technology can easily be used to safely and securely reward people for producing value that benefits others. Today, online virtual world platforms such as Fortnite and VRChat give us a glimpse into the metaverse; they promote innovation and collaboration between community members. Crypto communities like thenewboston are working to build a better worldwide economy through open collaboration and compensation for a diverse range of contributors including developers, designers, and marketers. Their blockchain is public and their code is open source. These are all signs that the future of the metaverse is bright and blockchain technology can help it flourish.