Over recent weeks, the metaverse has gone from a relatively niche term to mainstream headlines all over the world, thanks to the Facebook effect. After the tech giant announced it was renaming its parent company to “Meta” as a reflection of its dedication to building a metaverse, the concept now has everyone talking about how our digital future selves will interact online.
Of course, Facebook wasn’t the first to come up with the idea of the metaverse, and it surely won’t be the last. A week after Facebook announced its name change, Microsoft confirmed it was making its own foray into the digital metaverse, although it’s taking a somewhat different approach to Facebook. While Mark Zuckerberg’s firm is firmly focused on accelerating VR adoption, no doubt due to its investment in headset maker Oculus, Microsoft is counting on its vast enterprise user base for its Teams application. Called Mesh, Microsoft’s interface is designed to enhance, rather than transform, the way we live online. It focuses on a more personal and interactive meeting experience for workforces who are becoming disillusioned with Zoom.
And these are just the big names. Long before Microsoft and Facebook began their metaverse-related ventures, blockchain projects had spotted the potential. Decentraland, a kind of decentralized Second Life based around its own token economy, had already launched a live version of what Facebook seems to be seeking to achieve back in 2018. The Sandbox is a more recent entrant established in 2020, but has seen considerable success, recently netting $93 million in funding from investors, including Softbank.
Walled Metaverses or Interoperable Networks?
This competitive approach, where firms attempt to become the first to develop the biggest and best metaverse that attracts the most users, is predictable and understandable. It’s how social media evolved and how the blockchain landscape has emerged over recent years. But we know from experience that fragmented ecosystems are less than the sum of their parts. Within a few years of Ethereum’s launch, many copycats followed suit. But few of them managed to gain any significant traction because Ethereum had the first-mover advantage.
It was only once the community woke up to the inherent value of interoperability that new platforms like Polkadot, Binance Chain, and Solana became legitimate competitors to Ethereum. Except, of course, in an interoperable environment, competition comes with a healthy dose of collaboration, too. One of the earliest projects to recognize the fact that a lack of interoperability in blockchain was hampering the growth of the ecosystem was Wanchain.
Many Chains, One Network
Wanchain provides the economic infrastructure for developers to build applications that span multiple blockchains and communities. Under the hood, it works using a non-custodial decentralized infrastructure. When a user wants to send assets, such as tokens or NFTs, to another blockchain, the Wanchain protocol effectively freezes them and issues proxy assets on another chain. The proxies can then be used in any supported application, such as a metaverse, on the other blockchain. When the user wants to return them to their originating chain, Wanchain burns the proxies and unfreezes the initial tokens.
As one of the most immersive forms of online engagement, there’s immense value to be captured from the metaverse, and brands are only just beginning to realize this. But imagine, for example, a retailer who wants to set up a virtual shop. If there are dozens of disparate, unconnected metaverses to choose from, how does the merchant know which one is best? One might have more users, but the other might have more big spenders.
Furthermore, users will undoubtedly be willing to spend more for assets they can use across multiple metaverses. For instance, a pair of NFT sneakers for a gaming avatar will be worth more if they can be used in any game, rather than just a few games based in the same metaverse as the sneakers. By locking users and merchants into one metaverse, operators are missing out on all the value to be had from interconnectivity.
How Can Centralized Tech Firms Continue to Compete?
So when we see Facebook and Microsoft and all the decentralized metaverses attempt to develop their own platforms, it raises the question – how long will it take for all this to become apparent? The blockchain community, thanks to early pioneers like Wanchain, soon woke up to the fact that fragmentation was limiting.
However, centralized tech firms have a significant interest in protecting their own walled gardens. But if the blockchain world is willing to embrace an open, decentralized future where assets can flow freely across boundaries and users, can the big tech firms and their closed ecosystems continue to compete?
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