In 2021, tech giant Facebook changed its name to Meta Since then, the concept of the metaverse has been getting a lot of public attention. But what exactly is the metaverse? And how can it improve our daily lives? In the metaverse, you can connect, learn, collaborate, and play in ways that you have never imagined. Popular news press Gartner Predicts 25% of People will spend at least one hour per day in the metaverse by 2026. It seems interesting, right?
Surely! It will be, as here we will learn how inspiring blockchain technology is and how can both cohere with each other to change the future of how we interact, transact, and experience the digital world.
Understanding the Basics
What is Blockchain Technology?
In simple terms, a blockchain is like a digital record book for all cryptocurrency transactions. It gets bigger when new transactions are added. Each of the transactions is stored in a block, which has details about the transaction, a time stamp, and a special code that links to the previous block. This linking of blocks forms a chain, which is why the technology is known as blockchain.
Blockchain is like a super-secure technology bodyguard for things like money and digital stuff in the virtual world. When you save something on the blockchain, it stays the same and can't be secretly changed.
The Metaverse
The metaverse refers to a virtual world where people interact with each other through virtual avatars. This is also known as a second life because they can do almost anything in real life here, such as visit interesting places, make new friends, buy artwork, or sell real estate. People are able to connect there in all areas of their lives. With just one browser, users can access a number of websites and platforms. Users can connect with other Metaverse users, create avatars, and purchase and trade virtual goods.
Why is blockchain technology important in the metaverse?
Security and Trust
Blockchain technology is important in the Metaverse because it provides a secure and transparent way to verify and record transactions. With blockchain, all transactions made within the Metaverse are stored in a decentralized and immutable ledger, making it impossible for them to be secretly changed. This ensures trust and eliminates the need for intermediaries or central authorities to oversee transactions.
Decentralization
As blockchain technology operates on a decentralized network, it makes it impossible for hackers to steal or misuse information to commit fraud. Users get complete authorization over their information by using private. Tokens are also used as another element of blockchain technology. These are used for transmitting digital information, personal data, and authorized keys in cryptic storage devices. Thus, no other individual can access the private information unless given permission to.
Smart Contracts
In the metaverse, smart contracts can automate transactions, enforce agreements, and ensure that the rules of the virtual world are followed without the need for intermediaries or third parties. This enhances efficiency and trust in the metaverse ecosystem, as smart contracts are generated automatically based on predefined conditions.
Interoperability
Blockchain allows for the unrestricted interoperability and operation of many systems and interfaces. This is particularly important when it comes to NFT valuation and turnover.
Use Cases of Blockchain in the Metaverse
Because of all the advantages it provides, blockchain is an essential piece of technology in the metaverse:
Virtual Currencies
Virtual currencies are one of the places to use blockchain technology. It is not far away when the virtual currency will be considered crucial for making any purchase in virtual shops. People would be able to do daily activities like shopping and studying, but the metaverse will have its own token to purchase digital collectibles. That's where blockchain plays an important role in bringing the metaverse from concept to reality.
MANA, a token used to purchase virtual property in the game "Decentraland," is an example of how virtual currencies can be used in the metaverse. Besides, not just in Metaverse Games, virtual currencies can also be utilized in DeFi for virtual lending, borrowing, investing, and trading within the metaverse.
NFTs
According to many experts, NFTS (non-fungible tokens) will play a key role in the metaverse. These tokens will be used in digital art, tracing, and where they are already used as a proof of ownership.
An NFT is a key that provides access to specific sections of the metaverse. Tokens will eventually be used as a reward in metaverse NFT games in addition to fungible tokens.
Real Estate
Real estate would be considered one of the primary digital assets in the metaverse. But here’s a catch: how can you access a virtual real-state object and regulate a market when the metaverse actually represents an infinite digital space? That’s where blockchain technology can be used as a registry that records all the actions performed with virtual real estate assets, such as creation, change, purchase, sale, or disposal.
Self-identity Authentication
Blockchain provides a reliable solution for verifying one's identity securely. By utilizing cryptographic algorithms and decentralized consensus mechanisms, blockchain technology eliminates the need for a central authority to authenticate and validate identities, reducing the risk of fraud and unauthorized access. Privacy is a major concern in the metaverse, and blockchain helps balance the need for transparency with the protection of users' anonymity.
In-game Assets
The players' virtual assets will soon be offered as non-fungible metaverse tokens, according to a number of blockchain experts. This will allow players to earn real money that can be used as payment within a particular ecosystem. Players can truly own their in-game items and even move them between games or platforms, a concept that was not possible in traditional gaming models.
The top 3 blockchain projects in the metaverse
Decentraland
One of the earliest pioneers in the metaverse, Decentarland, is a 3D metaverse where users can create avatars, buy and equip land plots, organize various events, and generate digital content. The primary economy of Decentraland operates on the blockchain, which enables digital identification and confirmation of in-game asset ownership.
Virtual land, or "LAND," is the primary digital asset in the game. Moreover, the metaverse has a native ERC-20 cryptocurrency token, MANA, which is used as an internal means of mutual settlement between the players.
The Sandbox
Another prominent entry in the list of the best metaverse crypto projects would be Sanbox. This NFT game is extremely popular at the moment. The Sandbox was originally created as a regular mobile app, but over a period of time, it has evolved into a complex Ethereum-based metaverse with its own SAND token. As of January 26, 2024, this token’s market cap is over $1 billion.
Enjin
Enjin Coin (ENJ) is a digital cryptocurrency operating on the Ethereum blockchain. It not only operates on the blockchain but also offers opportunities for creating NFTs that they could use as in-game items. or trade with other players. Enjin Coin has gained significant traction in the gaming community due to its seamless integration with popular gaming platforms and its ability to provide a secure and transparent environment for trading virtual assets.
Enjin also ensures digital assets are highly liquid by converting Enjin NFT into ENJ metaverse tokens. Enjin also empowers scarcity and digital collectability, thereby qualifying it for the metaverse.
Although there are many different interpretations of the metaverse concept, practically all analysts believe that it is a promising market sector. The primary components of the metaverse—digital ownership verification, money transfers, governance, accessibility, and interoperability—clearly depend on blockchain technology. In the upcoming years, there is expected to be an even deeper connection between blockchain technology and the metaverse.