The Metaverse is Not Real, Yetby@barthillerich
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76,678 reads

The Metaverse is Not Real, Yet

by Bart HillerichOctober 7th, 2022
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Metaverse platforms will be quite different than today's currently available Web3 offerings. With the requirements like interoperability standards and the capability to support internet scale, it's clear that no such platform exists today. For now, all we can do is wait for the vision of the metaverse to be brought to life!

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With projects like Decentraland and Sandbox either live or running through public testing, it feels a bit controversial to state that the metaverse isn’t real.

It’s not uncommon to come across expectations that newly formed projects will be able to “build the metaverse” soon or within the next couple of years. To be blunt, that isn’t going to happen. Bringing the metaverse to reality is the single greatest technological challenge that humanity has ever been put up against. It’s the intersection of gaming, VR, AR, blockchain, DAOs, NFTs, cryptocurrencies, and many more advanced technologies, some of which have not yet been created. It will take many years, hundreds, even thousands of people working together, and $100M+ for a project to actually bring the first instance of a metaverse experience to the masses.

To really dive into when the metaverse will actually be a reality, we need to tidy up some common misconceptions and then dissect what defines the general concept of the metaverse.

Come along for the ride and discover what I’ve coined the “metaverse platform” and learn why it’s different than what is available for consumer use today.

No One is “Building the Metaverse”

“Our team is building the metaverse.”

Sound familiar? If you’re deep in the Web3 space, you probably hear it (or variations of it) all the time. I know I sure do. It’s exhausting.

The problem with those types of statements is that no Web3 team is actually building the metaverse. That would be akin to a late 90’s dot com bubble company claiming that they were “building the internet". That wouldn’t make any sense, right?

No one single entity will own or control the entire metaverse. It will be a vast network of what I like to call “metaverse inputs”, ranging from massive metaverse platforms down to Web3 worlds/games, NFT collections, and Web3-native tools, apps, and technologies. Everything comes together to form the metaverse just like hundreds of thousands of websites and tools come together to form today’s internet that you and I experience daily. Like Web2’s “internet”, the “metaverse” will be the overarching umbrella ecosystem in which everything else in Web3 eventually exists.

There is a key distinction to make between what I’ve categorized as Web3 worlds/games and metaverse platforms: platforms have not yet arrived, worlds and games have.

No one single entity will own or control the entire metaverse. It will be a vast network of what I like to call “metaverse inputs

Worlds and Games

Projects like Sandbox and Decentraland are two prominent examples of a Web3 world. These are large MMO games that offer an open-world experience where users can create, play, and earn the project’s native crypto token. There is no mandatory linear experience; users are in the driver’s seat when it comes to how they’ll interact with the world and utilize its offerings for fun and profit.

These worlds are like a halfway point on the road to a metaverse platform and are commonly confused for being a metaverse platforms. Although these worlds will play an important role in the metaverse industry, they’re not going to be at the apex of Web3 when the dust settles across a mature multi-trillion dollar industry and they do not achieve the full vision of the metaverse.

Similar to Web3 worlds but smaller in scale and less complex, Web3 games like Axie Infinity, Aurory, and highly-anticipated upcoming releases Parallel and Clementine’s Nightmare offer a non-open-world, more traditional gaming experience with the added integration of Play to Earn (P2E) and NFTs.

Aurory: "Tokané needs a hero to help summon the guardians"

Metaverse Platforms

When people think of the metaverse, they typically imagine an expansive, immersive 3D world akin to the Oasis in Ready Player One. This vision involves hundreds, even thousands of unique worlds all connected in one persistent MMO experience for users to explore. Enter the “metaverse platform”.

These platforms will bring the concept of the metaverse to a reality; until a true metaverse platform publicly launches, the metaverse is not real. They will feature vast virtual economies with a variety of Web3 worlds all seamlessly connected on the same underlying tech infrastructure. They’ll provide infinite opportunities for play, work, and earning cryptocurrencies. The key differences between a metaverse platform and our Web3 world examples are as follows:

  1. A Web3 world can’t import another Web3 world into it. Sandbox couldn’t bring the entire Decentraland project and $MANA into its ecosystem. A metaverse platform could.

  2. If a Web3 world fails, the project is over. However, on a metaverse platform with many worlds, the failure of one world does not mean the failure of the platform; there would be plenty of other worlds supporting the platform’s economy.

  3. In a Web3 world, everything is run on the same system of rules. If a partner joins Sandbox, they must transact in $SAND, use voxel art, etc. On a metaverse platform, a partner could create their own world with their own style of art, integrate their own unique cryptocurrency into the broader platform economy, and create an experience that operates on different rules (without presumably some boundaries) than others in the ecosystem.

until a true metaverse platform publicly launches, the metaverse is not real.

An analogy I consistently use to introduce the concept of a metaverse platform is that metaverse platforms are like modern day streaming services. When the metaverse industry has matured, I believe there will be anywhere from 3-10 major metaverse platforms that dominate the attention of consumers, similar to how today there are a handful of major players in the streaming industry.

Like streaming services where consumers must consider trade-offs between options (especially when it comes to the unique experience each streaming platform provides through deals, partnerships, and UI) consumers will gravitate towards their preferred metaverse platform because of the experience they can immerse themselves in. With this in mind, the race to acquire top partnerships is vital to the adoption and overall success of any given metaverse platform because they are a primary driver of the unique experience that users ultimately have.

When the dust settles and the metaverse industry has matured, I believe there will be anywhere from 3-10 major metaverse platforms that dominate the attention of consumers.

Defining the Metaverse Platform

So why exactly is the metaverse “not real, yet”? Quite simply, as I also explained in this Twitter thread, it’s because no publicly available projects meet the basic requirements to actually be defined as a metaverse platform. These requirements are outlined below.

Run on Blockchain and Crypto Integration

Blockchain and crypto integration are not optional features when it comes to achieving the vision of the metaverse. People must be able to maintain sovereign ownership of their digital assets; this is only possible with the use of blockchain. NFTs will enable users to freely own digital assets and cryptocurrency will provide the means necessary to transact them and create commerce within the virtual experience. This requirement notably rules out projects like Meta and Roblox, which are frequently incorrectly described as metaverse projects.

Be Capable of Hosting a Vast Network of Interconnected Immersive Worlds with Various Easily Exchangeable Cryptocurrencies that Form a Robust Global Economy

A true metaverse platform might start with just one Web3 world in its infant stages, but it must be built upon a layer of technological infrastructure needed to host many connected Web3 worlds simultaneously. The Web3 worlds available to the public today are impressive, but they don’t make the cut here.

A metaverse platform will be able to serve as a “world of worlds”, hosting many Web3 worlds and their unique cryptocurrencies on the same platform in a persistent experience. A player could earn tokens playing a FPS shooter on one Web3 world, travel to a new world, seamlessly exchange tokens for the new world’s local currency, and then use them to play that world’s games and interact with the local economy in any variety of ways.

The largest metaverse platforms will be massive in scope. For an example of just how large these virtual experiences will eventually be, look no further than Wilder World. Its first city (according to its founders, there will one day be many) alone will be 13.5x the size of Grand Theft Auto V.

Be Fully Decentralized

Because a metaverse platform must grant users sovereign ownership of their digital assets, the platform must, in turn, be decentralized because that is the path to truly achieve that requirement. Like the blockchain/cryptocurrency requirement, this rules Meta out as a metaverse platform.

On centralized platforms like Meta, users could be under the guise that they own their digital assets, but as we’ve seen in Web2 with the rise in frequency of account bans, the platform would ultimately be the owner of the accounts and assets. If you act in a way that the platform doesn’t like, or say something that doesn’t fit into their agenda, it’s game over for you and the assets you poured time and money into acquiring.

Large, centralized tech corporations have no place in the metaverse; we’re on the cusp of a new paradigm. Pre-Web3, the rise of new technologies fueled by network effect growth fed profits to a very small group of stakeholders in corporations like Google and Facebook. Crypto enabled venture capital, a world typically reserved for a select few, to be spread to the masses. The metaverse takes that concept to the next level with a virtual economy built from the ground up in which anyone can establish ownership for any amount of money.

A decentralized metaverse means the end users stand the most to gain in the platforms rise to prominence. It means that, through features like DAO governance, users hold the power to evolve the platform to best suit their needs and prevent changes that infringe upon their values and personal beliefs.

Enable Users to Create New Worlds, NFT Projects, and DAOs within it

The point of having a large-scale metaverse platform with the capacity to host many Web3 worlds is that users will be able to build their own! Creation on metaverse platforms will not be reserved for specific partners, wealthy investors, etc. There will be available tools for teams to create their own ecosystem within the broader platform ecosystem.

I’d imagine there will be some sort of approval process to the creation of new worlds, otherwise the platform runs the risk of having non-builders occupy significant space within the ecosystem. How this will ultimately work is yet to be seen, but I wouldn’t be surprised if DAO voting plays a role in the process that we eventually see established.

The Platform must Bleed into the Real World through Technology like AR

The metaverse will not be confined to the virtual domain. Through the rise of new tech like Apple’s upcoming AR glasses, it will be brought to the forefront of consumer attention with NFT-powered experiences in shopping malls, sporting events, etc. A teenager could be walking through Times Square, Apple glasses activated, and see a Cool Cats NFT appear that leads her on a quest to a special pop up store where she can redeem a free bucket hat for completing the quest. There’s even possibility for events like concerts to exist simultaneously in both realities. Experiences aside, another key point to a metaverse platform bleeding into reality is its cryptocurrency being usable IRL to purchase physical goods.

Because the metaverse will exist IRL, the ability to transact IRL with money used in the virtual domain of the metaverse must inherently be true as well. Retail plays a key role in this.

Concept H&M Virtual Store

In the metaverse, it is likely that virtual retails stores will exist where IRL items can be purchased as well. Picture this: you walk into a virtual Puma store in the metaverse with your avatar, and once inside, you’re able to try on virtual wearables that can be purchased as an NFT for your avatar, or alternatively, you can purchase the item IRL and have it shipped to your place of residence.

With these retail experiences on the table for the future of the metaverse, and a likely avenue for them to occur being through platforms inking official partnerships with retailers, it’s not far-fetched to assume that retail partners that operate virtual metaverse stores will sign on to terms and conditions that their IRL stores must accept the native cryptocurrency of the metaverse platform.

Provides Interoperability Standards so Anyone can Build in the Ecosystem

Metaverse inputs are going to plug into metaverse platforms. Over millions of instances, this activity will stimulate the virtual economy and contribute greatly to filling the platform with an abundance of characters, accessories, and compelling experiences.

Interoperability standards are essential for these inputs to coexist seamlessly within the same platform. In order for the vision of a user taking their NFT avatar across different Web3 worlds to come to fruition, that NFT must be interoperable across those worlds. This is one of the greatest challenges of actually building a successful metaverse platform; not only does the platform need to build interoperability standards and SDKs for an abundance of different types of NFTs, they also need to disseminate those standards across the broader metaverse industry and convince other parties to adopt them.

Unreal Engine 5

One potential vehicle to greatly assist in forming these interoperability standards is Unreal Engine 5 from Epic Games, which they’re calling “The world’s most open and advanced real-time 3D creation tool”. In speaking with many people across the metaverse industry, the general consensus among many is that UE5 will play a huge role in the future of the metaverse because of its extraordinary capabilities to create massive worlds filled with lifelike 3D content.

Enables any NFT Project to Fully Integrate (if They Meet Interoperability Standards)

Under the assumption that a metaverse platform must provide standards of interoperability, we can then reasonably say that, through those standards, other projects must be able to join the platform and integrate through means such as creating avatars, owning and maintaining land, hosting events, forming DAOs, integrating their native cryptocurrency into the virtual economy, etc.

This requirement brings about the concept of “the open metaverse”, which, in relation to the concept of a metaverse platform, essentially means a platform where assets can flow freely between Web3 worlds without barriers that currently exist between different user experiences. For NFT projects integrating through interoperability standards, this means that their assets in the ecosystem will be able to function across the entire platform in each activated Web3 world. Someone with an NFT avatar could use it to play an FPS, then a mini golf game, and then at a social event, all without having any barrier to doing so.

Be Capable of Supporting Internet Scale (Billions of users, Trillions of assets)

As I stated in my article covering the joint effort between Wilder World and Zero to create the world’s first true metaverse platform, such a project must be designed to support internet scale: that’s billions of players and trillions of unique assets.

In order to create a compelling world within a vast metaverse platform ecosystems, they’ll ultimately need to be filled with millions of NFTs. Consider the possibility of hundreds, even thousands of Web3 worlds within a platform, and now we’re reaching into billions, even trillions of NFTs. This is far more grand than the current capabilities of available Web3 worlds and is demonstrative of how far the industry still has to climb.

Having trouble picturing it? Imagine if everything you saw Grand Theft Auto V, from cars to land and clothing, was an NFT. Now imagine that world is only a small fraction of what metaverse platforms will ultimately become. Yeah, that’s a lot of NFTs.

For Now, we Wait

The time that we will need to wait for the world’s first metaverse platform to publicly launch is unclear. For anything significant to happen in the near future, I believe it will have to come from a project team that has been working in the metaverse industry for at least the last five years. As I said earlier, expectations that newly founded projects (within the last 1-2 years) will bring the metaverse into reality are unreasonable due to the amount of time and funding required to pull it off.

It is however, reasonable to assume that whichever team cracks the code and launches the world into the metaverse will have a massive head start on everyone else and rise to become one of the highest market cap organizations in the world. Be on the look out for teams that have been in the game longer than everyone else that shows signs of meeting the requirements of being a metaverse platform. It is there that the greatest opportunities in Web3 will lie.

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Disclaimer: This article is written purely for entertainment and educational purposes and should not be taken as financial advice in any way. Do your own research and, if you are seeking financial advice, find a professional who is right for you.