If you’re a crypto enthusiast and want to take your game one step further, then you’ve probably got questions about metaverse crypto and how you can capitalize on it.
To answer your questions in detail, this article will explore what the metaverse is, how it works, and what cryptocurrencies form the underlying tokens for metaverses.
Let’s dive in!
What is the metaverse?
The concept of a metaverse was first introduced in science fiction as early as 1935 when Stanley G. Weinbaum wrote a tale called ‘Pygmalion’s Spectacles’ in which the protagonist, Dan Burke, explores a virtual world with a pair of special goggles.
Today, ‘metaverse’ is one of the most buzzed-about words in gaming and tech. A metaverse is an immersive, virtual world where players (in the form of avatars) can interact with each other, build objects and landscapes, and create unique experiences – much like in the real world. Roblox and Minecraft are very early examples of metaverse-inspired worlds where players can build virtual worlds and interact with each other.
The metaverse can be accessed through a computer, VR headset, or a smartphone. But a digital world can’t fully become a metaverse unless there’s some form of trading involved. Many metaverse structures existing today have their own economies and currencies and allow users to buy, sell, and trade items such as avatar clothing, digital real estate, accessories, and more.
Future metaverses will also allow virtual worlds to interact with each other seamlessly. Imagine your avatar from one game traveling to another game without any change in features, attire, or accessories.
Right now, the concept of a true metaverse is aspirational and not yet a stark reality, but we’re rapidly getting there. Facebook has expressed its interest in supporting a metaverse for a more immersive, connected, and decentralized world with tokens that hold real-world economic value. And their rebranding from Facebook to Meta is a big indicator of what future developments we can expect from this tech giant.
What is metaverse crypto and how does it work?
A crypto metaverse is a metaverse that uses blockchain as the underlying technology for its functionality and uses crypto assets as the underlying currency for users to trade digital items or earn rewards. Here, cryptocurrency is used to reward players and fund the platform where traditional money is non-functional.
The introduction of blockchain technology in crypto metaverses has been explosive. It has unveiled new ways in which users can interact with each other and the virtual world, as well as the real-world market value of items and experiences earned in the digital world.
Any digital property rights are recorded as NFTs (non-fungible tokens) and the secure nature of NFTs ensures that digital assets are accurately tracked when bought or sold. The use of cryptocurrencies and NFTs also allows users to trade in-game items such as avatar skins and digital real estate and earn money from them in the real world by exchanging in-game coins on exchanges like Binance, ByBit, KuCoin, MEXC, Huobi, BingX, and eToro.
These game tokens are rapidly growing as a sub-asset class and investors are spending on them in the hopes that what is metaverse crypto today could become the next iteration of the Internet and cryptocurrency in the near future. And early investors hope to make massive profits from them if they act now.
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Key Features of Crypto Metaverses
Crypto metaverses differ from other metaverses in several groundbreaking ways:
- Decentralization: Early game worlds were owned and controlled by companies but crypto metaverses built on blockchain tech are decentralized and owned jointly by all game participants. This means that even if the original creator of the crypto metaverse was to discontinue the game, the metaverse would continue to exist in lieu of a copy of it being stored on the blockchain that’s accessible by all participants.
- User governance: Due to their decentralized nature, many popular crypto metaverses put their users in charge of the game’s future, and decisions about changes and updates are made through user voting. This means that the future of crypto metaverses will mean more equity and democracy.
- Provable provenance: With NFTs used as tokens in crypto metaverses, it is easy to trace the origin of transactions and user upgrades using blockchain. And with such ironclad proof of ownership, there is little to no chance of tampering or fraud.
- Real economic value: Because of blockchain technology, crypto metaverses are connected to the wider crypto economy. This enables users to take their digital assets to the real world and sell them on NFT marketplaces.
- Security: A user’s identity in a crypto metaverse is directly linked to their cryptocurrency wallet. And unless they’ve shared their details or wallet key publicly, no bad actor can steal the information and manipulate their funds or digital assets. This is because blockchains are maintained by a node network and information about any transaction made is stored securely and irreversibly on the network for all users to access.
Challenges of Crypto Metaverses
- Since there’s no regulatory framework yet for crypto metaverses, investing in them could be risky and speculative since the market is volatile. For example, in 2022, the cryptocurrency market experienced a big decline, causing the value of many cryptos globally to fall. This included the cryptos used as sub-assets in metaverses like Sandbox and Decentraland.
- Many users in the crypto metaverse are anonymous, which makes it impossible to sue bad actors. However, some lawsuits have still been filed. For example, in June 2021, Roc-A-Fella Records sued Damon Dash for selling an NFT that used a Jay-Z album cover.
- Even though metaverses were designed to enable millions of people to interact simultaneously and in real time, the current infrastructure available is not robust enough to support millions of users and, subsequently, millions of blockchain transactions.
Top 3 Metaverse Coins in 2024
Let’s look at the top 3 coins used in the metaverse today! By studying this metaverse crypto list, you can decide what metaverse crypto isgoing to look like for you, should you choose to invest.
Decentraland (MANA)
Decentraland is a crypto metaverse that was created in 2017 but it gained popularity in 2021 when NFT trading became mainstream. Within this metaverse, NFTs are traded in exchange for MANA, the crypto coin for Decentraland. Decentraland is powered by the Ethereum (ETH) blockchain and although MANA’s value dipped during the 2022 bear market, it’s still one of the most popular metaverse coins in 2024.
Decentraland’s main feature is that it allows users to buy virtual land and create digital assets. In fact, many real-world companies have also bought digital real estate in Decentraland for their virtual offices – this includes big names like Samsung, Coca-Cola, Adidas, and Nike. Decentraland recently also sold a digital plot of land for a record $2.4 million!
MANA saw an all-time high value of $5.90 in November, 2021.
Sandbox (SAND)
Sandbox is another top metaverse project, which is powered by its crypto coin, SAND. Sandbox is essentially a game, and it allows users to build and trade assets, earn in-game tokens, buy and trade digital real estate, and much more! Sandbox released its first game in 2012 and is backed by gaming company, Atari.
Like Decentraland, Sandbox has also attracted huge artists, influencers, performers, and brands to its virtual world.
SAND saw an all-time high value of $8.44 in November, 2021.
Axie Infinity (AXS)
Axie Infinity is an NFT-based game that was created by Sky Mavis from Vietnam. This game also uses the Ethereum blockchain for its functionality and hosts more than 250,000 daily users. NFTs in Axie Infinity are in the form of digital pets called Axies that players can collect and trade for the in-game coin, AXS.
This metaverse is a play-to-earn game that allows its players to battle their pets in multiple virtual lands, with the winners collecting tokens. Players can also create kingdoms, complete quests, and build treasure troves. The most engaged players earn rewards but each player must have at least 3 Axies to participate in a battle.
AXS saw an all-time high value of $165.37 in November, 2021.
The Bottom Line
The world can’t afford to turn a blind eye to crypto metaverses any longer – not when there are people in Venezuela making a living by playing Axie Infinity, when metaverses are hosting virtual concerts and fashion shows, and when celebrities like Paris Hilton are using metaverses to create virtual experiences for their fans and following.
Brands are also looking to the crypto metaverse to engage their customers and provide innovative shopping experiences. For example, players can choose a digital asset such as Nike shoes from Nike’s virtual store, pay for it using metaverse coins, and then their avatar can wear that specific shoe style in the game. For some styles, the user can also get a pair of the same shoes delivered in the real world!
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FAQs
Is metaverse crypto a good investment?
Cryptocurrencies in and of themselves are very volatile in value. And that means that metaverse crypto, as sub-assets, are even more so. As an investor, you should do your research and understand how the digital assets market works and which cryptos have been performing well historically.
You should also diversify your portfolio to spread your risk. Remember, your investment in metaverse crypto is your bet on how profitable you think the future is for the metaverse – and you won’t be the only one who thinks so!
