5 | What is a metaverse?

A metaverse is an immersive digital world in which people can interact with each other, create experiences, and produce in-metaverse objects, buildings, landscapes and more. These virtual worlds typically have their own economies and currencies which can be used to buy, sell, and trade digital real estate, items, avatar accessories, and an endless array of possibilities. Metaverse-like environments have existed for some time now in massive-multiplayer online role playing games (MMORPG), but the integration of blockchain, cryptocurrency, and virtual reality into the sector is drastically altering who can participate in the metaverse and what they are capable of doing.

A crypto or blockchain-based metaverse is a metaverse that incorporates blockchain technology and digital assets such as cryptocurrency and non-fungible tokens (NFTs) into its base technology and economy. Utilizing the blockchain allows for the demonstration of the real-world market value of assets, interactions, and experiences in the metaverse. Metaverse crypto assets and items — such as digital land and NFT objects, for example — are typically represented by different types of metaverse tokens. Their ownership is recorded on the blockchain and can even be traded on internal or secondary marketplaces and exchanges.

As people move more and more into the metaverse for business, shopping, and pleasure, they will need a secure way of showing ownership and transferring value. People will also want to play a role in the decision-making processes of the metaverse. Blockchain provides a decentralized and transparent way of dealing with these obstacles. Utilizing NFTs to represent metaverse infrastructure, lands, and other valuable objects allows for provable ownership and transferability of these objects. Metaverses will also be governed by decentralized autonomous organizations (DAOs) that put the decision making processes of the metaverse in the hands of its community. DAOs rely on the blockchain for effective operation.

Blockchain developers also take influence from the video game world with gamification already prevalent in Decentralized Finance (DeFi) and GameFi and the introduction of such mechanisms into the metaverse has tremendous potential to provide a major impetus for blockchain and Web3 adoption through the metaverse.

Congratulations! You completed the introductory course on blockchain sectors! Now let us put your newly gained knowledge to the test. Quiz time!
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