How NFTs are Powering the Metaverse

This article was originally published in Blockchain Industry Review - a Crypto Curry Club Magazine published monthly and available in soft copy and the printed version.


Written by Guest Contributor Matt Hawkins,

Founder and CEO of crypto mining software, CUDO


Metaverse, the next frontier in social connections, has captured the tech industry’s imagination with a promise of a futuristic vision. Ever since Facebook announced that the platform’s future would be in the metaverse, companies are clamouring to figure out how they can skew their businesses to align with this burgeoning space.


Virtual worlds have been around for a couple of years, but Facebook, Microsoft, and Nvidia joining the metaverse bandwagon injected renewed interest in this area.


Pegged as the next-generation way that people will interact online, there isn’t a single way to define the metaverse. Instead, it is an embodied internet, a hybrid between the physical and digital world. This shared 3D environment lets people join with their avatars and shapes how the virtual “reality” looks.



Transferability and centralisation issues


While many virtual worlds exist online, users currently cannot travel between them. However, the future metaverse could solve this problem, letting users navigate a single, seamless entity. In that sense, the true metaverse is a long way from actualising, but these platforms could allow users to transfer the NFTs they buy or own between platforms.


So isn’t that how actual ownership should work in the metaverse? Ultimately, the future metaverse will allow unparalleled interoperability of digital assets and data across different virtual worlds.


Additionally, the metaverse expands the Web 3.0 concept, the antithesis of the current state of the Internet, crippled by centralisation and data ownership issues. Companies like Facebook, Google, Amazon own the information users share on their centralized networks, leaving the everyday user with no absolute ownership or control of their accounts. However, at its core, the metaverse will challenge that by establishing decentralisation and giving users true sovereignty over their privacy and data.



Riding the NFT wave


As users increasingly personalise and curate the space around themselves in the virtual world, NFTs have become their medium to take their avatar and movable assets to the metaverse.


NFTs will play a crucial role in driving purpose, commercial activity, and delivering utility in the evolving metaverse. In addition, NFT ownership could serve as a gateway to onboard millions of users into the metaverse. For instance, Dapper Lab’s NFT token marketplace, a leader in digital sports collectables, witnessed $500m in sales in April and around 150,000 to 250,000 daily logins in May. Simply put, adding the NFT component to the metaverse allows individuals to participate and define the experiences in these virtual spaces.


Seeing this potential, many have rushed to capitalise on the intersection between the metaverse and NFTs. For example, Dolce & Gabbana rolled out a collection of virtual clothing for digital avatars in the metaverse. Elsewhere, NFTs have had many use cases like utility tokens for exclusive concerts, display at virtual galleries, real estate investments, virtual sporting competition, among others.


Morgan Stanley forecasts that the digital demand for fashion and luxury brands, fuelled by NFTs and social gaming in the metaverse, is expected to reach $50 billion by 2030. Little wonder then that we will witness huge conglomerates shape the metaverse in innovative ways by crafting worlds involving gaming, fashion, entertainment, and social experiences in the coming days. But is this the direction we want to take?



A better way forward


It is difficult to imagine the metaverse without cryptocurrency and its underlying blockchain technology. Concepts such as transparent and traceable transactions, an open, interoperable network to exchange virtual assets, and storing virtual assets via a permissionless, trustless, verifiable ledger are all fundamental.


However, interoperability could emerge as a challenge even as NFTs create the foundations for the emerging metaverse. As tech companies build the infrastructure, solutions should keep the affordability of minting and transfer of NFTs in mind, making it accessible for the artist community. Further, it must facilitate frictionless integration with marketplaces and other custom smart contracts, allowing easy transfer of assets. Lastly, it’s crucial to embrace an environmentally sustainable way to ensure a positive lasting impact of NFTs in the metaverse.


While, undoubtedly, blockchain provides much promise to the metaverse, some limitations remain. For instance, scalability and our ever-increasing need for computing which, although available, is wastefully underutilised.


There are two unresolved problems, however. First, some layer one and two technologies are working to alleviate slow, expensive transactions to solve scalability but are far from perfect. Second, centralised offerings can fuel the computing demand but are structurally vulnerable to mass outages and ideologically conflicted with Web 3.0.


Decentralised computing could be a sustainable solution to harness the underutilised capacity of inactive business and personal devices globally. The future is an open-source, permissionless blockchain ecosystem that allows developers to build and deploy smart contracts and DApps, relying on decentralised computing to scale.


As the influential corporations control the centralised real world, it will be refreshing to be part of a virtual universe with no central authority, no surveillance, no data theft, but community-driven governance. Imagine a parallel world where NFTs will be used to authenticate ownership over digital assets with an opportunity to monetise virtual creations in the metaverse. From not owning anything, individuals could become stakeholders in the NFT-powered metaverse of the future.

 

Meet Matt Hawkins

Matt is an entrepreneur who enjoys building fast-growing technology businesses. He has a passion for developing innovative technology & services to improve the world we live in, from disadvantaged individuals & communities to corporate businesses.


Matt founded C4L in 2000 which was one of the UK's fastest-growing ISP's & winner of many fast-growth awards inc. Times Tech Track 100, Deloitte UK Top 50, Deloitte EMEA Fast 500 & many more. During the 15 years of growth, they won over 50 awards ranging from customer service to helping local communities.


They have also built one of the largest private networks in the UK including their own data centre, scaled to over 1% of the UK's internet infrastructure, built the UK's largest data centre marketplace. Customers inc. Government, FTSE 250, Top 100 VARs, ISPs, Resellers & SMB's.


Winner of Entrepreneur of the Year 2013, HSBC South West Business Thinking Winner & proud to be entrepreneur in residence at Bournemouth University. C4L was acquired in early 2016 after which he worked on technical & M&A strategies.


Matt started Cudo in 2017 designed to be the Uber of computing & provide the world with more sustainable cloud compute, by utilising the worlds computing power and helping individuals & good causes. This was followed by CUDOS enabling the worlds computing resources and data to power blockchain.


Their platform is installed in over 145 countries & is able to utilise the $1 trillion per year in underutilised hardware providing new ways for people & businesses to monetise their IT infrastructure. They're looking to use our technology to revolutionise the charity funding sector. Coverage inc. Forbes, BBC & Moneyweek.


Hus passions inc. creating innovative solutions to improve the world, helping entrepreneurs/startups, investing in great ideas & helping them succeed and projects that do good in the world.


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