As global celebrities like Stephen Curry and Jay Chou choose to enter the game of NFT, it's not uncommon to raise a question from their vast fans and the public: what on earth are they buying? Meanwhile, people may also get curious about another highly-related buzzword: "metaverse." How will it change our lives? Whether it is a "turkey flying in a strong wind" or just a strong wind blowing money away? Let's take a closer look.
Why is metaverse so hot?
The metaverse appears to have taken off overnight in the second half of 2021, becoming the "number one trend" in technology. Metaverse, more or less a metaphysical concept at first glance, has become a constant discussion topic inside and outside the tech circle. This buzzword earned its sudden fame just half a year ago, but the concept is not a stranger to people at all.
The term "metaverse" first appeared in the 1992 science-fiction novel Snow Crash. Under Neal Stephenson's pen, this "virtual reality" is a 3D digital space that is closely linked to society and parallel to the real world, where geographically isolated people from each other in the real world can communicate and entertain themselves through their individual "avatars". This kind of scenario is quite similar to what people imagine for the metaverse even today.
But why do we have a feeling that metaverse seems to come out of nowhere? Now, let's have a review of how it earned this "instant success" within recent months.
Igniting: it all started with the prospectus of Roblox
In March 2021, Roblox, a multiplayer online creation game platform, launched an IPO on NASDAQ and saw a surge. In its prospectus, Roblox mentioned the concept of "metaverse" several times, earning it the title of being the "first metaverse IPO" that ignited the story.
Heating up: tech giants tried to secure their advantages by joining the metaverse
In May 2021, Microsoft CEO Satya Nadella said the company was working to build an "enterprise metaverse". Later in July, Epic Games, developer of Fortnite, announced that it raised $1 billion in funding for this sector. This is followed by NVIDIA, the leading GPU company that launched the world's first metaverse simulation and collaboration platform Omniverse in August. Besides, one of the most eye-catching might be Facebook, whose name had been changed to "Meta", which was announced by its CEO Mark Zuckerberg on 28 October at Connect 2021.
Chinese tech giants also made instant reactions to this trend. Netease released "IM+RTC+Virtual Human" and "Game/VR voice" as two metaverse solutions; Baidu joined the game by upgrading the "-6.0" version of its metaverse product "XiRang"; Alibaba set up a subsidiary called "Yuanjing Shengsheng" (the prefix 'meta' is translated and spelt as 'Yuan' in Pinyin), literally indicating that its future business is related to metaverse; ByteDance spent a bunch of money to acquire VR startup Pico, and strives to develop an immersive virtual social platform.
While many technology companies are ramping up their metaverse tracks, more traditional ones are getting involved in an attempt to get a head start. Fashion brand Balenciaga had announced to set up a dedicated "metaverse" department to study and seek virtual marketing and business opportunities. Zhangjiajie, a Chinese world natural heritage where James Cameron's epic movie Avatar was filmed, announced the establishment of the first scenic spot-based metaverse R&D center in China. Trademarks related to metaverse have been snapped up by many companies, including SAIC, MXBC, and Shuanghui Group.
Hyping: under the boom, chaos arises
With the rising popularity of metaverse, some relevant online training programs have been touted. However, the heat also brings chaos with the emergence of "property speculation groups" and some less-regulated "Wechat business" courses. As the hype surges while causing so much controversy, official media has also started to speak out against the chaos. On 18 November, People's Daily published an article on its WeChat public account: "people still need to rationally look at the current metaverse craze and be wary of any lull in the name of science, technology, and the future; it remains to be seen whether it is a cheap illusion or a future within reach, a capital speculation or a new track, some old wine in a new bottle or a genuine tech breakthrough that shapes the future."
From the global perspective, there are two reasons that metaverse emerges at the moment.
First, capital investors need new stories. Against the backdrop of the waving pandemic and a downward economy, several technology companies need to find a viable way to break out as the benefits of Internet traffic hit the top. At this moment, the once-silent VR/AR field has been given a shot in the arm with the rise of the metaverse concept. Facebook's name change, on the one hand, demonstrates its determination to be all in the metaverse, and on the other hand, it also diverts the public's attention from their long-lasting disputes. With this new name and vision, the social media company's controversial image that is too deeply involved in anti-trust inspections and user privacy cases has gradually disappeared.
Second, digital life needs new excitement. The COVID-19 pandemic has widely changed people's work and life patterns and accelerated global digitalization. Whether it's for home working or recreation, only "surfing online" no longer satisfies people's needs. Meanwhile, the consumer Internet hasn't seen a breakthrough for a long time, and it has been more and more difficult to entertain users in a virtual world; thus the immersive virtual experience offered by metaverse will bring more space for imagination.
Behind the fad of NFT, what on earth are they buying?
Although the concept of the metaverse is hotter than hot, the real metaverse may stay on the level of "imagination" with the current technologies. On the one hand, technological evolution needs to follow a gradual process. On the other hand, many "metaverse products" are just some reshaped versions of traditional applications and services at the moment, which do not bring incremental demand, except for NFT.
NFT has surged with the help of technologies related to the metaverse. Some people call NFT the "new kid on the blockchain", which is also regarded as the key to opening the gate of the metaverse.
NFT, or Non-Fungible Token is a blockchain-related term that is a "unique" asset in the digital world that can be traded, and its core value just lies in its "uniqueness".
"Every Day: The First 5000 Days" is an NFT artwork created by digital artist Beeple. The starting bid was $100, and then it sold for an amount 700,000 times higher than that.
NBA superstar Stephen Curry spent $180,000 to get a new profile picture, an ape formed by color blocks.
At the beginning of 2022, the metaverse platform Ezek and Jay Chou's fashion brand PHANTACi jointly launched the first NFT project Phanta Bear for a limited amount, and the project was sold out in only 40 minutes with a total price of RMB 62 million.
In all similar stories, NFT technology has played an essential role in adding "uniqueness" and "scarcity" to the ordinary digital artworks that obtain values of collection and investment just as those traditional artworks did. Since 2021, the NFT market has exploded in growth with a surge in transactions. As of early December 2021, the annual cumulative trading volume on the NFT trading platform OpenSea reached as high as $12.91 billion.
But what exactly does the metaverse have to do with NFT? In layman's terms, the primary trading order in the metaverse can be built by NFT.
As an immersive virtual world, the metaverse must enable shopping, socializing, entertainment, and other necessary activities for social life. But unlike the real world, all digital assets in the metaverse are a string of codes that can be copied and pasted without limits. Therefore, how do we safeguard our private digital assets and do all these activities without worrying? NFT just points out a way for us, as the blockchain-based NFT can be used to confirm the ownership of your digital assets.
In the metaverse, everything from houses to clothes can be forged as NFTs if users can privately own them. NFT confirms virtual assets' uniqueness and authentic rights, and counterfeits can be effectively eliminated. In addition, it allows users to forge their own NFTs and use them for leasing and selling, as well as to transfer assets across platforms to maintain the metaverse's decentralization.
But if you think deeper, you may also find something different. Although NFT is backed by blockchain technology which makes everything traceable, digital ownership in the virtual world is not equal to the same thing in the real world. However, stimulated by celebrities and various smashing wealth stories, more and more people are attracted to play the game of NFT.
The reasons behind the purchasing could vary, such as gaining a sense of identity or the possibility of being rich overnight. However, there is no doubt that the number of buyers and sellers of NFT continues to expand. When more people join, the money game can be better played. As no one can predict who will be the lucky winner, the game will be both crazy and fun.
How will metaverse change our lives?
Today, enterprises, capital, and human resources are flooding into the metaverse industry. Though it is still in its "embryonic" stage, we may see some changes in 2022.
Development of VR
Meta's Oculus VR products are almost dominant in the current VR market. It's foreseeable that the VR market will take another step up in its market volume in 2022, and we may also see some dark horses emerge this year as a few Chinese hardware companies completed large financing in 2021.
The launch of more metaverse products
Though Baidu's metaverse product "XiRang" is yet a half-baked product, it's certainly a signal that more tech brands are expected to step in and start their metaverse in 2022.
More new marketing paradigms are born
Metaverse has given rise to a range of marketing approaches that drive new eyeballs to a brand or product. Nike has created Nikeland in Roblox; Gucci has experimented with digital assets such as NFT and has reaped rewards; virtual beauty expert Liu Yiexi has gained millions of fans with two videos on Douyin; and hyper-realistic virtual idol AYAYI has become a digital host for Tmall Super Brand Day ... More metaverse marketing approaches are bound to be born in 2022.
Regulatory legislation
The development of the metaverse is to be put on the right track, and it is impossible to let it grow wild for a long time. Even as technology gets more mature in the future, the construction and governance of metaverse will encounter many problems,, such as social ethics and morality, of which the risk of uncertainty is extremely high. It is expected that in 2022, the metaverse will meet more challenges coming from governance, and relevant laws and regulations must follow.
Be rational: a "turkey flying in a strong wind", or just a strong wind blowing money away?
The concept of metaverse has been deconstructed, reconstructed,, and defined by countless people, but the boundaries and extensions of the idea are still confusing. The metaverse seems to be a new bucket that can be filled with anything, and the future of its development is not that clear right now. For this controversy, it is natural to see two distinct schools of thought on how to view the metaverse.
Those thinking optimistically believe that the metaverse has become popular, reflecting the progress and development of fundamental science and technology. From an industrial point of view, the metaverse can be seen as a carrier for integrating the virtual and real worlds, with latent opportunities for changes in games, socializing, and other scenarios. In the long run, its development is expected to create considerable incremental value and help promote the improvement of production efficiency and social operation efficiency.
While those who hold the opposite view believe that if everyone lives in an imaginary space, it will not bring actual development to human society. As Tesla's CEO Elon Musk said, "I don't see someone strapping a frigging screen to their face all day and not wanting to ever leave ."By keeping ourselves in a small box, human beings lose the possibility of conquering the real vast universe. Meanwhile, the so-called "decentralization" may not sound perfectly beautiful, as absolute freedom could lead to oppression.
The birth of something new is bound to be accompanied by new risks, just as moral and ethical controversies will always follow the development of new technologies. It is significant to reiterate that technology itself is not a criminal, but the people behind it are inclined to good or evil, which is the same for the metaverse. In the early days of change, even the most visionary person could not see the whole picture. Despite our expectations of the metaverse, we must examine it rationally, be cautious of the shifting from reality to virtuality, and keep in mind that there are speculators who will take advantage of it when everything is chaotic. There is still a long way to go before the metaverse becomes "reality", so caution and patience are both needed. The story could be about a turkey flying in a strong wind, or about a strong wind blowing your money away.
