Rabindra Ratan, Associate Professor of Media and Information, michigan state universityand Dar Meshi, Assistant Professor of Communication Arts and Sciences, Michigan State University.
You might think of the metaverse as being a bunch of interconnected virtual spaces – the world wide web but accessed through virtual reality. This is largely correct, but there is also a fundamental but slightly more cryptic side to the metaverse that will set it apart from the internet today: the blockchain.
In the beginning, Web 1 was the information superhighway of connected computers and servers that you could search, explore, and inhabit, usually through a centralized company platform—for example, AOL, Yahoo, Microsoft, and Google. Around the turn of the millennium, Web 2 was characterized by social networking sites, blogs, and the monetization of user data for advertising by centralized gatekeepers of “free” social media platforms, including Facebook, SnapChat, Twitter and TikTok.
Web 3 will be the basis for the metaverse. It will consist of blockchain-enabled decentralized applications that support an economy of crypto assets and user-owned data.
Blockchain? Decentralized? Crypto assets? As researchers who study social networks and media technology, we can explain the technology that will make the metaverse possible.
Blockchain is a technology that records transactions permanently, usually in a public, decentralized database called a ledger. Bitcoin is the most well-known blockchain-based cryptocurrency. Every time you buy something from bitcoin, for example, that transaction is recorded on the Bitcoin blockchain, meaning the record is distributed to thousands of individual computers around the world.
This decentralized recording system is very difficult to cheat or control. Public blockchains, such as Bitcoin and Ethereum, are also transparent: all transactions are available for anyone to see on the internet, unlike traditional bank ledgers.
Ethereum is a blockchain like Bitcoin, but Ethereum can also be programmed via smart contracts, which are essentially blockchain-based software routines that are automatically executed when some condition is met. For example, you could use a smart contract on the blockchain to establish your ownership of a digital object, such as a piece of art or music, that no one else can claim ownership of on the blockchain, even if they keep a copy on file. your account. computer. Digital objects that can be owned (coins, securities, works of art) are crypto assets.
Items like artwork and music on a blockchain are non-fungible tokens (NFTs). Non-fungible means that they are unique and non-replaceable, the opposite of fungible items like currency: any dollar is worth the same as any other dollar and can be exchanged for it.
Importantly, you could use a smart contract that says you’re willing to sell your digital artwork for $1 million in ether, the Ethereum blockchain token. When I click “accept”, the artwork and the ether automatically transfer ownership between us on the blockchain. There is no need for a third party or bank escrow, and if either of us were to dispute this transaction, for example, claiming I only paid $999,000, the other could easily point to the public record in the distributed ledger. .
What does this blockchain crypto asset have to do with the metaverse? Everything! For starters, the blockchain allows you to own digital goods in a virtual world. Not only will you have that NFT in the real world, you will also have it in the virtual world.
Also, the metaverse is not being built by any group or company. Different groups will build different virtual worlds, and in the future, these worlds will be interoperable, forming the metaverse. As people move between virtual worlds, say from Decentraland’s virtual environments to Microsoft’s, they’ll want to take their stuff with them. If two virtual worlds are interoperable, the blockchain will authenticate proof of ownership of your digital goods in both virtual worlds. Essentially, as long as you can access your crypto wallet inside a virtual world, you will be able to access your crypto stuff.
don’t forget your wallet
So what will you keep in your crypto wallet? You will obviously want to carry cryptocurrencies in the metaverse. Your crypto wallet will also contain your exclusive digital goods from the metaverse, such as your avatars, avatar clothing, avatar animations, virtual decorations, and weapons.
What will people do with their crypto wallets? Among other things, store. Just as you probably do on the web now, you’ll be able to buy traditional digital products like music, movies, games, and apps. You’ll also be able to buy items from the physical world in the metaverse, and you’ll be able to see and “hold” 3D models of what you’re buying, which could help you make more informed decisions.
Also, just like you can use your old leather wallet to carry your ID, crypto wallets will be able to be linked with real-world identities, which could help facilitate transactions that require legal verification, like buying a car or home from the public. real world. Because your ID will be tied to your wallet, you won’t need to remember your login information for every website and virtual world you visit; just connect your wallet with one click and you are connected. be useful for controlling access to age-restricted areas in the metaverse.
Your crypto wallet could also be linked to your contact list, allowing you to carry your social network information from one virtual world to another. “Join me for a pool party at FILL IN THE BLANK-world!”
At some point in the future, wallets could also be associated with reputation scores that determine the permissions you have to stream in public places and interact with people outside of your social network. If you act like a toxic troll spreading misinformation, you can damage your reputation and potentially reduce your sphere of influence by the system. This could create an incentive for people to behave well in the metaverse, but platform developers will need to prioritize these systems.
Lastly, if the metaverse is money, then companies will want to play too. The decentralized nature of blockchain will potentially reduce the need for gatekeepers in financial transactions, but businesses will still have plenty of opportunities to generate revenue, possibly even more so than in current economies. Companies like Meta will provide great platforms where people will work, play and meet.
Major brands are also joining the NFT mix, including Coca-Cola, Adidas and Nike. In the future, when you buy an item from the physical world of a company, you could also gain ownership of a linked NFT in the metaverse.
For example, when you buy that coveted brand-name outfit to wear to the real-world dance club, you can also become the owner of the crypto version of the outfit that your avatar can wear to Ariana Grande’s virtual concert. And just as you could sell the physical outfit secondhand, you could also sell the NFT version for someone else’s avatar to wear.
These are some of the many ways that metaverse business models will likely overlap with the physical world. Such examples will only become more complex as augmented reality technologies come more and more into play, merging even more aspects of the metaverse and the physical world. Although the metaverse isn’t here yet, technological foundations like blockchain and crypto assets are constantly developing, setting the stage for a seemingly ubiquitous virtual future coming soon to a ‘verse near you.
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This article is republished from The Conversation under a Creative Commons license. Read the original article.