We will be in-person on July 19 and July 20. Join leaders of data and artificial intelligence for talks and networking. Register today!
NFTs are coming of age as investors discover new use cases for them beyond the initial frenzy of digital artwork and collectibles. A prime example is seamless connection with the metaverse industry, a fast-paced development which will inevitably shape NFT application and exponentially grow adoption in the long term.
Metaverses hold great promise for a more open and fair economy, one that is backed by the blockchain. NFTs will serve as the gateway to a metaverse, as they empower the identity, community and socialization of the metaverse economy.
Recent developments in the metaverse industry are setting NFTs on a new path to the future, and it is safe to say that the first NFT was minted in 2015. There are lots of speculative opportunities emerging for businesses, investors and entrepreneurs. The metaverse is relying on NFTs to fulfill five functions.
Amusement parks, movie theaters, concerts, and live spectator sports are all forms of entertainment spending, but the gaming industry is more popular. It should not be a surprise that when Mark Zuckerberg announced Facebook's name change, he mentioned gaming as one of the leading motivators.
Consumers are familiar with 3D avatars and world-building because gaming has been associated with virtual reality. Today's virtual reality gaming is mostly done on a mobile phone or headset. This is a more realistic experience than traditional video games. In a metaverse, players can interact with each other and play games through human- computer interaction.
The next frontier of gaming is enhanced by social gaming, play-to-earn and portable game assets. NFTs hold the keys to all of the concepts. NFTs are the in-game currency for P2E. The more value you add to the game, the more you earn. The P2E game is more open than traditional platforms. Thanks to the ownership capabilities afforded by NFTs, players fully own their assets, instead of the earnings being controlled by a centralized game operator.
NFTs are intended to represent unique assets. NFTs can be traded and sold on virtual platforms. The next wave of the creator economy is being ushered in by NFTs.
The creator economy is built by artists, writers and other creators across physical medium. The creator economy was only officially used during the digital age. Over 50 million independent content creators, curators and community builders are part of the creator economy in the United States.
Each asset has codes and features that can't be duplicated. The value of the asset is exclusive to the owner. The code can include additional rights and obligations, such as sell-on fees that give the creator a percentage of future transactions of the digital asset. The key mechanisms of smart contracts andcopyright tracking enhance intellectual property rights and solve problems faced by creators in the cyberage.
The metaverse industry is a major step forward for the creator economy, offering a virtual world where content can gain value and creators can gain equity for their work. These features are only possible because the product is tied to NFTs.
NFTs will play a leading role in enabling the communities, personal identity mechanisms and social experiences that will define the metaverse. Users could explore a hobby or support a project by purchasing NFT assets. NFT owners will be able to come together to form communities, share their experiences and collaborate on relevant content creation.
NFT avatars are a critical concept in the socialization system of a metaverse, representing not just a player's actual self but also an identity they imagine. Users could use NFT assets to build their identity and gain access to new experiences in a metaverse.
In a metaverse, NFTs can be seen as the extension of our real-life identities, giving us each complete ownership, control and flexibility for creating our virtual persona.
The social experiences of the metaverse model can be transitioned offline as well, with NFTs effectively bridging the gap between physical and digital worlds. The Bored Ape Yacht Club, created by four pseudonymous founders, is trying to connect virtual and physical reality. The BAYC NFTs give owners access to exclusive clubs and features of the community, such as first-access to new NFT collections, and even private events. The yacht party and warehouse rave was hosted by BAYC.
Virtual property spaces are being assessed to the tune of millions of dollars, as the metaverse industry brings real estate into a new realm. An asset of virtual land in the browser-based metaverse Decentraland was sold for over two million dollars. In December of 2021, a user spent $450,000 to become a neighbor of the rapper, who is also the creator of the interactive world he is developing in the platform.
NFTs allow for the virtual plot of land to be transacted. The value of the digital real estate market is dependent on the amount of space available. The land in Decentraland is roughly 50 feet by 50 feet. Digital scarcity is a concept that has been discussed in relation tocryptocurrencies.
The average parcel of virtual land across the four main metaverses doubled in six months, from $6,000 to $12,000. Virtual land is growing in value at the same rate as physical land, yet there are no interest rate increases that will slow it down.
The metaverse industry is still in its infancy and being shaped by changing digital behaviors. NFTs are on the same track.
The metaverse model creates an interoperability environment with seemingly endless possibilities for consumers to gather, socialize, play, earn and transact. Businesses must move the needle on their NFT investments from exploration to activation as NFTs are the linchpin for creating value and engaging users in the metaverse economy.
Jonathan Teplitsky is the CEO of PipeFlare, a platform that helps game developers monetize their work.
The VentureBeat community welcomes you!
Technical people doing data work can share their insights with experts at DataDecisionMakers.
If you want to read about cutting-edge ideas and up-to-date information, join us at DataDecisionMakers.
You could even contribute an article of your own.
Data decision makers have more to say.
All Rights Reserved © 2024
