In a report on the metaverse sector, Coinshare provides insightful insights into how the metaverse can change society through cutting-edge blockchain technology.
Like many web3 concepts, the definitions and interpretation of certain language elements can still be unclear. The metaverse is one of these expressions. It can mean many things. And users don’t always agree on the exact definition.
First of all, if we analyze the etymology of the word, metaverse is the contraction of metawhich comes from Greek and means “after, beyond”, and pours to universe in English. We understand that this term therefore means beyond the universes, something more comprehensive. It is in “The Virtual Samurai” by Neal Stephenson that we find this concept of metaverse for the first time, in 1992, long before the creation of Bitcoin.
To give a general definition, the report tells us: Overall, we think it’s okay to strive for global, user-owned, interoperable 3D virtual worlds built on top of the existing Internet. To avoid confusion, Metaverse is neither a game, nor an application, nor a store. It’s not just virtual reality either. Nor is it a single digital world or space. It won’t replace the internet and won’t (probably) completely consume our lives. »
This vagueness surrounding the concept of metaverse will therefore affect investors’ and users’ perception of its possible uses and how it works.
More and more investors, but with different visions
The figures provided by Coinshare are particularly impressive, the number of companies in the metaverse sector has increased by 20% according to the compound annual growth rate (CAGR) since 2001 and registered a rate of 293% per year in 2021 due to its explosion in popularity. ” This is likely due to the excitement surrounding the possibilities and values that the metaverse could create. This has led to larger rounds of financing, an increase in the number of funds and the nominal value of invested capital. There are more than 455 companies in the metaverse in 2021, just 50 in 2018. Mark Zuckerberg goes so far as to name the metaverse as the opportunity of the century.
But this investment knows great territorial differences. According to Coinshare, more than half of the companies in the metaverse sector are in North America, followed by 31% in the Asia-Pacific region, far behind we find the EU with 14%, then 3% in the Gulf, despite the hard work of Dubai, which intends to change its place in Web3, and 2% in South America, the African continent is currently off the radar.
Coinshare claims that this situation is particularly alarming and contrary to the web3 mentality, “ Global initiatives should rebalance metaverse development to avoid a landscape dominated by big tech. This can help reduce Web2-like characteristics, namely data mining and privacy issues. »
This geographical disparity is not the only problem surrounding the expansion of metaverses.
Many problems for users and regulators
The first major obstacle to the development of the metaverse is the lack of cutting edge technology to take full advantage of these digital worlds. The metaverse will not be fully lived on a screen, for that it is necessary to be equipped with virtual reality (VR) helmets, augmented reality (AR) glasses and extended reality (XR) handheld devices. All of these tools are the future of the metaverse. But so far, they don’t offer an experience intuitive and immersive enough to be adopted by many.
Additionally, developments around the metaverse remain highly dependent on the cryptocurrency market. A big problem when you know the volatility of this market and the possible crashes it can suffer. This therefore affects the growth and sustainability of the development of metaverse projects.
At the core of the metaverse is the possession of NFTs. This market is also evolving and it is still difficult to know what will become of the real value of these digital goods.
” Although user ownership is an important attribute, digital ownership does not guarantee monetary value. Using blockchain technology, one could create a fixed number of NFTs representing a virtual country. It’s almost the same in the real world, where you can always increase the total physical land supply. But with a lot of trouble and money. See man-made lands such as the Palm Islands in Dubai. Scarcity does not always determine the value of an item. It is the demand that does it. One could create a fixed number of NFTs representing a virtual country using blockchain technology. Rarity only has value in desirable locations – location, location, location. »
For regulators and users, the big challenge remains data security and management. Because, before arriving at a fully decentralized universe, the metaverse goes through many phases where web2 and centralization remain ubiquitous. In addition, hacks and bugs remain a danger in web3, with the example of the 600 million stolen with Ronin Chain.
We are therefore at the beginning of the real metaverse. As when you want to define a new world, a new concept, many questions arise. Despite the difficulties and obstacles ahead, the metaverse is attracting more and more people. Thousands of stakeholders remain convinced that this new digital world of almost infinite possibilities is transforming our daily lives. Regardless of whether we consume, work, live or interact. The metaverse will be everywhere, so you might as well understand and master it as quickly as possible.
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Observer of the monetary, economic and social revolution.