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Chapter 6:  dApps & Defi
May 02, 2022 |
updated Mar 18, 2024

Metaverse: A New Perception of Reality

Interesting Fact:
Did you know that the term "Metaverse" originated from a science fiction novel called "Snow Crash" in 1992?
9 minutes

Ever since Mark Zuckerberg - the CEO of Facebook - announced his company’s expansion into the realm of metaverses back in October of 2021, the concept has seemingly not left the lips of many people around the world. And YES, you might be surprised to find out that metaverses were a standalone concept long before Zuckerberg’s announcement - specifically, since the early 90s, and today I’ll explain to you what Metaverse is, the whole concept literally on my five fingers!

In this section, I’ll tell you all about the metaverse - what it is, what it has to do with crypto, and how is Mark Zuckerberg involved in all of this, in the first place. Let’s jump right into it!

So, then, first things first - let’s define the concept of a metaverse, shall we?

What is the Metaverse? (Meaning + Animated Examples)

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Video Explainer: Metaverse: A New Perception of Reality

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What is the Metaverse? (Meaning + Animated Examples)

What is the Metaverse? (Meaning + Animated Examples) What is the Metaverse? (Meaning + Animated Examples)

What is the Metaverse?

Now, admittedly, you’ll find many different definitions of the metaverse online. There are multiple explanations that are much more confusing than helpful!

The term itself came from the science fiction novel "Snow Crash" by the American writer Neal Stephenson in 1992. 

Indeed, Mark wasn’t the first genius who came up with it! 

Even in those days, Neil described the Metaverse as a virtual world, with virtual real estate - even the connection to it was made via special goggles, as we call them now, VR glasses! He was describing the whole subculture of “avatars” who choose to remain connected to Metaverse for-life, by wearing portable terminals. And you know what? Today this seems to me like the upcoming reality, not fiction.

By the way, it is a great, old book, I really recommend it to break your imagination!

So, to put it simply, a Metaverse is a digital world. The most common examples given revolve around some of the more popular video games today, such as Animal Crossing or Second Life. Within this digital world, you have your own avatar and are able to interact with the terrain, items, and other people’s avatars around you.

When someone talks about metaverses, most individuals will imagine a person with a VR headset on their head. This is because VR tools allow you to be more immersed in the aforementioned digital worlds - in other words, you are able to experience them in 3D.

What is a Metaverse: Concept of a Metaverse.

Notice how I use the plural version of the term - metaverses. That’s because, honestly, there can be multiple metaverses out there! This is not something that’s limited to a one, single project or design.

Let’s go over what users can actually DO in a metaverse, and why do we need it?

For starters, many individuals imagine metaverses as spaces for new-generation gaming. Today, there are already multiple VR-powered gaming options - different activities such as VR Saber or mountain climbing, and even cooperative games to play with friends.

There’s widespread speculation that, in the future, metaverse users will be able to virtually improve their working spaces, arrange meetings with friends or colleagues, visit digital meet-up hubs, travel to distant and alien lands, and do so much more. It probably wouldn’t be too surprising if, in 10 years' time, many of our daily activities (shopping, playing games, meeting friends) would be transferred to the metaverse, into a new illusive dimension or reality?

What is a Metaverse: What can you do in a Metaverse?

That being said, however, when people say “the metaverse” today, another concept that they are often referring to is a digital world built on blockchain technology. Let’s break that down, shall we?

A “blockchain” is an information storage area, you can call it “the new age database”. Just like you would store your family’s photos in an album, blockchains store information. Most of the time, this information relates to cryptocurrency transactions - that’s because many blockchains have their own, native cryptocurrencies associated with them.

Now, I can already hear you asking - what in the world do blockchains have to do with the metaverse? This is so confusing!

I can understand your frustration. Worry not, though - things are actually much simpler than you’d think!

When I say that the metaverse would be built on blockchain technology, it simply means three things:

  • The metaverse would be decentralized, at least in some form;
  • The metaverse would allow you to transact with cryptocurrencies;
  • Your profile information would be stored on the blockchain - the new generation database.

Most blockchains are decentralized. What this means is that there is no one central authority overseeing them. The simplest way to imagine it is this: when you go visit a social media platform, your experience will depend on the owners of that platform. The company behind the platform will moderate what you can and can’t see, what you can and can’t say, how you interact with others, and so on.

What is the Metaverse: Metaverse on a blockchain.

A decentralized version of such a social media platform wouldn’t have any of the aforementioned restrictions, if the community would decide to not impose them. In other words, decentralized platforms don’t have a single ruling authority behind them, and depend on the communities to be the decision-makers.

Within a decentralized metaverse, you would be able to make decisions with the rest of the community, in the form of democratic votes. The well-being of the metaverse would depend on each individual and not some central authority - how cool is that?

Now, let’s move on to the cryptocurrency transaction question in our new Metaverse world.

What is the Metaverse: Metaverse on a blockchain.

As I’ve mentioned earlier, most blockchains have their native cryptocurrency - think of Bitcoin, Ethereum, and the like. If a metaverse would be created with the help of blockchain technology, users would be able to pay for services with the native currency of that blockchain.

The simplest way to think of this is the way that you transact with the United States dollar. No matter which US state you might be located in, you will be able to use the same USD with all of your purchases - this is actually even true in many other parts of the world, as well!

Now, the popular opinion states that Ethereum is the most suitable blockchain for metaverse development. This is because this network is often described as “the global computer” on which many large projects have already been developed and created.

What is the Metaverse: Metaverse on a blockchain.

On that note, Ethereum is also often thought to be the foundational network behind Web 3.0, a new form of a decentralized internet. If you’re interested to learn more about this topic, I highly encourage you to check out another explanatory section by me on what Web 3.0 is!

Before we continue, why is Ethereum better than any other blockchain, though? 

Well, it’s scalable, stable, reliable, and most importantly, it was the first blockchain to implement Smart Contracts - special automated processes, or an automated logic, that allows people to make agreements with one another, without having to trust if the other party will hold up their part of the deal. Everything is processed under the openly seen, coded logic and no third parties can affect it from outside after it was launched. In most cases, even its initial developers can’t!

Smart contracts allow for fast, safe, and decentralized transactions to happen on the network. Implemented into the metaverse, they would act in the background - whether you launch a game or pay for a virtual plot of land, smart contracts would be involved, without you even noticing it!

What is the Metaverse: Why is Ethereum the most suitable blockchain for Metaverse?

Lastly, let’s take a look at the third point - your metaverse personality, a profile of information being stored on the blockchain.

Imagine that you’d be able to remain anonymous within the metaverse, thanks to blockchain tech. You’d probably still want to create some sort of profile, though, right? Well, same as you can create a character in a video game, you would also be able to do so within the metaverse, with the help of crypto, as well - your profile would be anonymous, yet tied to your account.

Say, you’ve created a digital painting that has become very popular within the metaverse. How do you prove that YOU were the one who made it? Simple - no matter who owns it NOW, if it was created, also known as minted, on your profile, you will forever be listed as the creator! Thanks to the blockchain technology behind the metaverse!

Moving on, up to this point, we’ve discussed what the metaverse is, and what cryptocurrencies and blockchain tech have to do with the concept. That’s a lot of information to wrap your head around, I’ll admit! One big question still remains unanswered - what does the CEO of Facebook, Mark Zuckerberg, have to do with all of this?

As I’ve mentioned at the beginning of this explanation, towards the end of October of this year, Zuckerberg announced that Facebook would be rebranding to “Meta”, and would start developing its own iteration of the metaverse - a digital world where you could connect with other people, work, exchange information, spend time with friends, and do all sorts of other cool activities.

What is the Metaverse: Metaverse on a blockchain.

This was a huge announcement since it was the first time that a large, that a global brand would delve into the metaverse technology, in such a straightforward manner. Following this, the general public’s interest in the concept of metaverses spiked, quite noticeably!

Some people are very excited about trying out this new form of technology and communication. Others, on the flip side, are very skeptical, especially since this is a concept explored by Facebook - a brand that, let’s just say, doesn't have the best track record when it comes to user data collection and keeping users' best interests in mind.

No matter which camp you fall into, one thing seems to be certain - the metaverse will be an industry-changing innovation that will affect all of our lives. With crypto technology being intertwined with the idea of metaverses, this becomes an even more interesting concept to explore and familiarize yourself with!

What is the Metaverse: How is Mark Zuckerberg involved?

So, I hope that now you have a better understanding of what the Metaverse is! If you wish to learn about the world of crypto, even more, check out the other section - "What is the Blockchain?".