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In one year, the number of companies working on the Metaverse has grown from 200 in July 2022 to more than 500 today, according to a Metaverse report from market researcher New Zoo.
A year ago, many people could presumably say they had never heard of the Metaverse. But with the explosion in demand for virtual life thanks to the pandemic, the metaverse quickly spread as a vision of life in persistent 3D spatial worlds all interconnected in an online universe.
Today, just about every major tech company, brand, influencer, and gaming company is getting involved in the metaverse, the universe of virtual worlds that are all interconnected, as in novels like Snowfall and Borrow player one† This is how you reach the younger generations of tomorrow. Last week, McKinsey said the Metaverse will have a market value of $5 trillion by 2030. And Khronos Group announced a coalition of groups and companies to come up with standards for the Metaverse.
Roblox is one of the most popular games in the world and it has become a platform where players can create and take advantage of their own games. Roblox and Epic’s Fortnite have added features such as virtual concerts, and influencers are claiming their rights.
The metaverse gives birth to virtual shows hosted by the most popular fashion and luxury brands. And the first iteration of blockchain games focuses more on the economic aspect and lacks the “fun” element to support new players. But the hope is that these games will become stepping stones into the metaverse by bringing interoperability and true digital ownership.
Newzoo said in-store digital shopping sessions are likely to become more realistic and mainstream as XR and VR technologies evolve. Virtual Earth — which is essentially a 3D advertising space — has taken the non-fungible token (NFT) space by storm.
Mihai Vicol, head of Metaverse at Newzoo, said in an interview with GamesBeat that the hype has cooled in recent months due to the global macroeconomic downturn, but said interest in the Metaverse is growing as a natural successor to Internet Web2. .
Newzoo said the move from Web2 to Web3 will decentralize the technology economy, changing the way brands interact with users and technology intermediaries. And it will certainly change the way consumers experience life, work and entertainment, Vicol said.
He said the evolution of simulated 3D worlds presents a huge opportunity for brands, with a transition from diffuse physical spaces to virtual worlds offering brands an opportunity to reach a condensed mass of users difficult to reach by other forms of commercial break.
Major companies such as Nike, Louis Vuitton, Balenciaga and Meta have recognized the change and are executing metaverse strategies.
When NFTs grew into a multi-billion dollar market in 2021, they crashed along with the cryptocurrency market due to fears of a global recession. Coin valuations and public interest have fallen in recent months, but Newzoo remains optimistic that the best projects will succeed. The report examines key trends in the metaverse and blockchain space.
The report notes that there is no single definition of the metavers. Jonathan Lai of A16z described the metaverse as persistent, shared 3D virtual spaces in a virtual universe.
Tim Sweeney, CEO of Epic Games, called it a real-time, 3D social media where people can create and participate in shared experiences as equal participants in a social impact economy.
And Newzoo defines it as an interconnected and interoperable network of persistent virtual worlds populated by a large number of players interacting with each other through 3D digital avatars, giving users a heightened sense of immersion and presence.
Newzoo cited investor Matthew Ball for noting aspects of the metaverse, such as scaling, where the limit on virtual spaces will go from 100 people per area to potentially infinite. He said it will have persistence, where it will feel like a permanent place where you can be immersed in new experiences. It will be interoperable, have its own economy and allow users to express their own identity through spaces. It will combine digital and physical experiences and will be populated by a wide variety of individuals, informal groups, organizations and commercial enterprises.
Where is the blockchain going?
One of the key questions is whether blockchain technology is the stepping stone to the metaverse, enabling interoperability and ownership through authentication on the blockchain’s digital ledger. But could there be another way? I asked Vicol why some hardcore gamers are resisting NFTs and whether blockchain games are about to become mainstream?
“You mentioned the dislike of most native or hardcore western gamers for blockchain games, and frankly I don’t blame them,” Vicol said. “Just 15 months ago, blockchain games were virtually non-existent. Maybe we had a few titles like CryptoKitties or Axie Infinity. But play-to-earn games didn’t exist.
Now we’ve seen the rise of Axie Infinity, as well as the subsequent collapse of some of those games. The problem is that they are not played by players. Instead, they are played by cryptocurrency fans who want to make a profit on the games.
“The problem is that these games are not sustainable. And if you ask the people who play those games, almost everyone wants to enjoy those games,” he said. “And in a sustainable ecosystem, it’s just not possible for 100% of the players to make a profit. There must be some players playing the game for fun, so they bet five dollars and at the end of the day they don’t expect to get away with $10 or $50.
Vicol believes that blockchain games will only grow if top developers release high-end games that are fun to play. These games must find a new use for NFTs if they are to succeed. Only then will the games appeal to more than crypto investors and appeal to mainstream players. Some games like collectible card games like Gods Unchained may have found the right tool for NFTs, Vicol said.
“You have to have a sustainable ecosystem, and in 90% of crypto games I don’t think that’s been the case,” Vicol said. “I believe sustainable blockchain-based economies can be built in six months or maybe two years. But we’re not there yet. †
It is also unclear whether the metaverse also needs cryptocurrency to be successful. Yield Guild Games CEO Gabby Dizon predicts we will have 10 million crypto wallets this year, but crypto is in a world of pain with Bitcoin dropping to less than half its recent value. The number of crypto wallets depends on a recovery.
Vicol did not say when he expects blockchain games and the metaverse to reach the mainstream.
“The real question is whether people will actually play these games,” he said. “It’s too early to say. You can throw billions and billions into the industry, and you could at least get some decent games that will be played by millions of players. But I think it’s too early to call him. I really don’t think the future of the metaverse is necessarily linked to the success of blockchain games.
He added: “Whether or not you need blockchain to create an open metaverse is an ongoing question. There are people on both sides of the argument. But I think titles like Roblox or Fortnite have shown that you don’t need blockchain.
Vicol thinks shared standards are needed for the metaverse to get the entire platform off the ground. He sees brands entering virtual real estate and virtual world apps such as Decentraland and The Sandbox. These worlds do not have many users, but are also in a very early stage of development.
Newzoo has not made its own prediction for the revenue associated with the Metaverse or its ultimate value.
“I was a little intrigued by all these big consultancies that are handing out numbers like $8 trillion (Citi) by 2030,” Vicol said. “I was a little surprised. So we don’t have metaverse revenue estimates yet, but we may consider making estimates.
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