Is the Metaverse a 1 trillion opportunity?
The 7th European Blockchain Convention features an interesting discussion about the Metaverse and its potential. The three-person panel was composed of Lex Sokolin, Head Economist at Consensys, Coty de Monteverde, Blockchain Center of Excellence Director at Banco Santander, and Laurent Perello, Advisor at Tron DAO. The panelists discuss how the metaverse may influence our lives in the short term, how it will look like in the future, and most importantly, what will the financial and economic architecture look like in the metaverse.
Photo taken by the EBC team during the European Blockchain Convention 2022
“In the future, we will interact with the Metaverse on a daily basis, and there will be many Metaverses rather than just one. The most important thing now is that we have to build our projects based on what we imagine the Metaverse can be in fifty years or a century from now.’’- Laurent Perello, Advisor at TRON DAO.
In the short term, the entertainment industry has the biggest potential in the metaverse. Coty de Monteverde thinks that in the near future, most of the adoption of metaverse will be seen in the entertainment industry, such as gaming, events, advertisement, and the fashion industry. Coty believes that the metaverse is still under construction right now, and we are still not certain of what the future holds, but we can observe that various companies have been working on metaverse to connect with customers and create a community.
Laurent Perello considers himself a dreamer, and he thinks that in the future, the metaverse will come naturally, as there are so many factors that motivate him to think of a new way of living. He envisions a combination of the real world and the digital one co-existing. Besides that, he envisions that there will be a multi-metaverse rather than just one metaverse, and there will be a huge landscape of centralized metaverses built by big corporations alongside fully decentralized ones that are governed by DAOs.
“Metaverse will not be a pixelated world but a reality. We will switch from the “real world” to the “ Metaverse” on a daily basis, and we will work, travel, or even go to the cinema in the Metaverse.’’ – Laurent Perello, Advisor at Tron Dao.
Therefore, when we build our projects now, we have to imagine what it will be like in the future, in fifty years or more, and build a bridge to allow people to switch smoothly from one metaverse to another. Laurent re-emphasizes the importance of building an interoperable metaverse, and states that brands will need to find a simple way to offer the best experience for users to switch between metaverses.
Coty de Monteverde thinks that in the future, thanks to blockchain technology, we will have the metaverse based on Web3, and we will have an ecosystem of different platforms with interoperability that are orchestrated through tokens in the likes of CBDCs, stablecoins, cryptocurrencies, NFTs, and others. Moreover, the financial system is going to be built around wallets, in which people store all their digital assets. Since wallets will be the central piece in the metaverse, we have to establish the mechanism to get into this digital economy. We have to build a seamless and easy way for the mass public to transfer the salary they get in the bank into digital money that they can use in the metaverse, and this is where she thinks the existing financial institutions can work on to increase mass adoption.
Visual of Lex Sokolin, Laurent Perello and Coty de Monteverde
“The financial ecosystem in the Metaverse will be digital and programmable, and the wallets are going to be the core piece in the Metaverse.’’ – Coty de Monteverde, Blockchain Director at Banco Santander.
Meanwhile, Lex Sokolin points out that in the physical world, money is an abstract layer on top of economic activities. We cannot always carry all our assets around, so instead we carry them in form of money. He thinks that by unlocking the magic of metaverse, wallets, or even Web3 in general, we can actually get rid of this economic abstraction because our wallets literally have our house, our clothes, and other assets. In the future, the crypto wallets will function more like an inventory that contains all our things without the need to compress them down.
Lex Sokolin concludes that the metaverse, similar to the framing of VR, works like an empathy machine. It allows us to feel what other people are feeling in a way that a 2D screen can not provide. The metaverse is not only about providing a better gaming experience, but the underlying idea is about embodying and being with people in a more authentic way. In addition, the economic activities in the metaverse will be “all human economic activities”, and since we are building a Web3 native economy in the metaverse, we will need a Web3 native financial and economic sector as well.
“Just because you have an empty room in VR or in a physical world doesn’t make it special, it’s what you can do and what you create in that room that matters.’’ – Lex Sokolin, Head Economist at Consensys.
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Published August 4, 2022, Barcelona