Metaverse economics: How does it work?
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The Metaverse is the evolution of immersive experiences and interactions currently taking place on the Internet. This is done thanks to new technologies such as virtual reality (VR), artificial intelligence (AI) and others.
But also, in this new digital era, a different economic system has been created, quite unlike the one we know in the physical world. How was this possible and how does the Metaverse economy work? We’ll tell you about it here, so read on!
The economics of the Web2-based Metaverse
Immersive worlds based on Web2 rules have their own tools to generate value. The most prominent of these is what is known as User Generated Content (UGC).
Games such as Roblox or Fortnite have evolved into platforms where users can create their own spaces and are rewarded with tokens that acquire value as digital assets. With such a strategy, it is the users who become creators, which increases their participation in a specific immersive world and their loyalty to it.
Pillars of the Web3-based Metaverse economy
Blockchain technology
A vast portion of immersive experiences existing in the Metaverse are based on the principles and rules of Web3. This means the application of blockchain, the use of Smart Contracts and greater control over users’ digital identity all help back the security of Web3 transactions.
Blockchain ensures there can be a secure record of digital assets that guarantees their ownership. The blockchain system allows for greater transparency and security of the economy, as there is a decentralisation compilation of data and no single agent ends up controlling the system. This greatly cuts down on digital fraud and leads to greater user confidence, as it is a fairer, more efficient and transparent system.
Digital assets
The digital assets that make up the Metaverse economy are those assets that are created, stored and have value for Web3 transactions. They are identifiable and may be owned by users or companies. The more attractive the offer, the more valuable digital assets will be in the future, and given that the Metaverse is ever-expanding, it is not yet clear where the limit is. This is why both companies and individuals are investing in this economic system today. Want to know what these digital assets are and how to access them? We’ll tell you all about it.
Tokens: fungibles and non-fungibles
- Fungible tokens are all those digital resources that have a value within a specific Metaverse space and are used as currency to purchase products or services. Tokens are based on blockchain technology but, unlike cryptocurrencies, these are controlled by a centralised agent. One example is Movistar tokens, which are progressively generated by interacting with the company’s services and can be exchanged for products and services.
- NFTs are a type of token that are characterised by their non-fungible properties. Ownership of these tokens is not exhausted with use, and they are unique and unrepeatable throughout the Metaverse. If a user acquires the NFT of a short story by Arturo Pérez-Reverte, only this user will have access to the story and, in addition, can use it in the different immersive worlds that support it.
Cryptocurrencies
Cryptocurrencies are all those virtual, decentralised currencies that are underpinned by the blockchain technology. Blockchains are responsible both for controlling the transactions and also for creating new units. Cryptocurrencies are characterised by the fact that they are not controlled agents inside or outside the Metaverse. Some of the best known examples are Bitcoin, Ethereum and Dogecoin.
What is a Wallet and how do you create one?
If you want to delve into the world of the Metaverse and buy digital assets, the first step is to make a Metaverse account and create your own digital Wallet. One way is through MetaMask, although there are many other platforms. Thanks to digital wallets, the user gains the ability to purchase and store the aforementioned items that make up the Metaverse economy.
One of the main features of the Wallet is that it is unique, or in other words, other applications are not needed into order to hold different currencies. It is also universal, so it can be used in any Metaverse space where Web3 is implemented.
How do you invest in the Metaverse?
The easiest way to obtain the first Metaverse resources is to buy cryptocurrencies or tokens through traditional currencies (euros, dollars, pesos, etc.) and, with these Metaverse virtual currencies, you will be able to acquire your favourite NFT collections.
One of the easiest ways for entry is to invest in cryptocurrencies. MetaMask offers the option to buy cryptocurrencies directly and easily add them to the Wallet.
If you prefer to start with tokens, these can be obtained in a variety of ways. You can get certain tokens the same way as cryptocurrencies, however, most are obtained by participating in events, investing in projects or playing games, the so-called play-to-earn, which encourages participation and rewards activity in the Metaverse.
Once we have cryptocurrencies or tokens in the Wallet, we can go to platforms such as TU Gallery to start buying NFTs from your favourite collections.
With these basic notions of how the economy works within the Metaverse, all that remains is take the plunge into the various immersive worlds and experience the infinite opportunities they offer.
Graduado en Publicidad y Relaciones Públicas, la creatividad y la sostenibilidad son mis dos grandes pasiones. Ahora, gracias al equipo de CDO Telefónica uno ambos mundos a través de la innovación y creación de contenido.
