The future of the metaverse looks uncertain. According to Google Trends, interest in the Metaverse hit an all-time high in January. Interest in the term plummeted in the second quarter of this year and has since plateaued.
With so many billions of dollars in this industry, BeInCrypto is asking where this industry is going and where we are after a year of market drama and Metaverse hype.
The term “metaverse” first appeared in the 1992 novel “Snow Crash” by Neal Stephenson. It was originally a science fiction term to describe a virtual reality where users would escape the dystopian world outside. Since then, the notion has evolved from fiction to fact.
However, recent reports of Metaverse’s launch have been mixed. An article by CoinDesk — using data from DappRadar — reported that there were just 38 “active users” on Decentraland over a 24-hour period. The sandbox reportedly had 522 concurrent users.
Metaverse platforms have taken a back seat. It should be noted that DappRadar’s figures only include the interaction of the unique wallet address with each platform’s smart contract. Users not using their token in-game are not included. Many use the Metaverse as a purely social platform.
So where do we stand?
The concept of a metaverse built on the blockchain is far from the accepted future of interactive media. According to experts, it is not guaranteed to become the dominant medium. AR and VR have competed better for the attention of technologists, futurists and academics.
So is blockchain a necessity for the future of the Metaverse?
“Whether or not cryptocurrencies are critical to the metaverse is largely a matter of definition,” says Nils Pihl, co-founder and CEO of Auki Labs, which specializes in virtual and augmented reality. “If you’ve defined the metaverse as a spatial version of the internet where identity and ownership are managed by blockchain, then clearly it’s crucial — but that feels like a cheap trick.”
“If blockchain had never been invented, the Metaverse could (and would) still be envisioned and built upon. Neal Stephenson coined the term long before blockchain was even a concept, and he was far from the only visionary to describe this type of Cyberdelic future.”
Reflecting on the lull in interest, he says, “The hype was based solely on people hoping to make a profit, not inhabiting these virtual worlds. Everyone bet someone else would be interested. Build something people want to use, not something people want to sell.”
A mixed picture for the Metaverse
The layoff of over 11,000 Meta employees over the past week has set off alarm bells across the tech sector. Given the already existing and widespread skepticism about the Metaverse, people are once again questioning the viability of a business model based on the still ill-defined concept.
For others, the concept of “true ownership” remains a key reason for a blockchain-based metaverse.
“As our digital lives become an ever-larger part of who we are as individuals, true ownership of digital assets will be critical to the long-term success of any metaverse,” said John Burris, Chief Strategy Officer for VCOIN at IMVU. “Blockchain technology enables real ownership.”
We’re still in the early stages of developing Metaverse together, and I think over time we’ll see the industry gain traction… When the tipping point comes, we’ll all see it. In the meantime, we and other Web3 innovators will continue to build the infrastructure needed for a robust, dynamic user experience.”
“Most of the entrepreneurs and innovators we work with on a regular basis don’t rely on Meta to advance this space. While their difficulties are unfortunate for Meta, it probably won’t stop builders in Web3 from continuing to build.”
So what do polls say? It’s not entirely clear
While competing visions remain, an October 2022 Sitecore survey of Metaverse “enthusiasts” showed a keen interest in many aspects of these new digital worlds. This includes new experiences, escaping reality, online festivals and concerts, meeting new people, and testing new products and services virtually.
Again, this is a poll of enthusiasts. And many of these user experiences are inherent in the definition of a metaverse. But there are still hurdles to overcome.
A previous survey of the general public by Wunderman Thompson Intelligence also found similar enthusiasm, but also found that only 15% of respondents “knew what the metaverse was and could explain it to someone else.” This is a very worrying metric for the industry.
A November poll by TELUS International found that 65% of respondents believe the Metaverse will be “mainstream” within five years. More importantly for businesses, respondents said they would pay a 5% premium for a product or service backed by a quality Metaverse experience, with nearly a quarter saying they would pay up to 10% more would spend.
It is unclear how these survey results correspond to reality. But according to multiple metrics, there’s still buzz about the Metaverse when people ask about it. Whether this can be transferred to actual use is another question.
trends for the future
There are bright spots for the future. Gartner has identified six trends that will drive Metaverse usage over the next three to five years. That includes Metaverse Gaming — which Gartner says is poised to grow 25%.
Others include “spatial computing,” which can digitally enhance real-world objects and landscapes by adding invisible information.
To preserve its natural heritage, Tuvalu plans to upload its entire land to the Metaverse. Their foreign minister Simon Kofe said: “As our country disappears, we have no choice but to become the world’s first digital nation.”
One thing is clear: we still need a clearer idea of what the Metaverse is and how exactly it will work. For Web3 natives and decentralization advocates, blockchain will often be crucial. Whether or not that dream comes true is a story for another time.
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