What is the metaverse and why does it matter?

Even if you only have a passing interest in technology, the chances are you’ve heard talk of the ‘metaverse’ lately.

This term’s growing prevalence is due, in no small part, to Facebook’s recent rebrand. The tech giant has explained that its new name, Meta, reflects its long-term strategic direction – away from social media as we know it, towards more fully realised digital environments.

But even if Mr Zuckerberg and co. had stuck with their firm’s original name, it’s likely we’d still have been exposed to more chatter about this concept over the coming months and years.

But why? What is the metaverse and, more importantly, why does it matter?

Digital spaces, but not as we know them

It’s difficult to succinctly define the metaverse because it’s a term used to describe such a diverse range of systems and technologies. Broadly speaking, it refers to virtual environments designed to foster immersive interaction between users.

Take video calling as an example. Most of us became familiar with this technology during the pandemic as it allowed colleagues, friends and families to connect face to face – albeit virtually – even when physical travel was not possible.

Now, imagine an online meeting but, instead of communicating with one another via webcams and microphones, you and your peers are wearing virtual reality (VR) or augmented reality (AR) headsets, so it looks and feels like you’re in the same room.

That’s just one example of what the metaverse could encompass, and it’s likely we’ll all be spending more of our lives within these digital environments in years to come.

Unprecedented immersion

Perhaps you’re sceptical when you hear phrases such as, “it’s like being in the same room”. After all, VR and AR technologies have been around for some time now and, although impressive, they remain primarily audio-visual experiences.

Today’s headsets and controls may enable you to see, hear and interact with virtual representations of your peers, but such encounters are still a far cry from physical, in-person gatherings.

Right now, I’d have to agree with you on this point – but perhaps not for long. You see, last month, Meta released a video demonstrating its ‘haptic glove research’. Essentially, this prototype hardware facilitates real-time physical sensations meaning that, when deployed in combination with VR technology, users are actually able to feel virtual handshakes or fist bumps from people sitting on the opposite side of the planet.

Granted, this technology is still very much in its infancy, but it’s not hard to envisage a future in which it becomes increasingly difficult to distinguish digital realms from the physical world.

Beyond theoretical

While haptically accurate handshakes might still be a few years away for most of us, that’s not to say the metaverse remains the stuff of science fiction. On the contrary, people are playing, shopping and even working in these spaces right now.

Many of their interactions and transactions are being facilitated by non-fungible tokens, or NFTs – another term you’ve probably been hearing more frequently of late.

NFTs work in a similar way to traditional certificates of authentication, but for digital assets. These tokens are also ‘non-fungible’, meaning they cannot simply be swapped for an equivalent token or tokens. Put simply, each NFT is unique.

This may sound technical (and, in truth, it is), but there is an ever-growing number of practical uses for NFTs, including ownership of digital assets, the protection of artists’ work, and even digital counterparts tied to real-world items.

Entering the mainstream

If you’re not a tech fanatic like me, you may be surprised to learn that the trading of NFTs within the metaverse is by no means a fringe activity. Major players are already working to secure a piece of this lucrative and ever-expanding pie.

Sportswear brand Nike, for instance, recently joined forces with online gaming platform Roblox to develop a virtual world known as ‘Nikeland’.

This deal will make Nike-branded digital products available to the more than 40 million daily active users of Roblox. Nikeland will be a free-of-charge service initially, but it’s easy to see this space’s potential for monetisation in the longer term – especially given that Nike recently filed seven ‘virtual goods’ trademarks for branding in NFTs and videogames.

Adidas, meanwhile, is also taking a keen interest in the metaverse, owing to a recent exchange of tweets with The Sandbox – a virtual environment in which users can build, trade and monetise in-game assets. Details remain thin on the ground but it seems likely that the footwear giant is eyeing its own patch of digital real estate.

This is exciting news for people like me who are firm believers in this space and have already purchased our own in-game land.

The Monkey Kingdom is another fun space for NFT enthusiasts. The project hosted its public sale on 27 November, and all 2,222 of its algorithmically generated digital monkeys were sold on the same day.

As you may have gathered from my latest fun Instagram profile picture (ali_saj), I recently decided to buy my very own monkey – not only because I like the art but also due to the vibrant community that has developed around The Monkey Kingdom.

The NBA represents another example of a global brand making inroads within the metaverse. Launched in October, NBA Top Shot is a marketplace that allows basketball fans to own their favourite moments from the sport.

NBA Top Shot NFTs are like multimedia trading cards (think LeBron’s incredible block against the Spurs in November 2019) that collectors can buy, sell and swap.

Although still nascent by some measures, the world of NFTs already represents big business. The most sought-after NBA Top Shot NFTs, for example, are selling for tens of thousands of dollars.

And even these deals pale in comparison with the NFT of Everydays: the First 5000 Days, a piece by digital artist Beeple, which sold for $69.3m earlier this year.

Why does the metaverse matter?

The metaverse matters because all current indicators would suggest it is going to play a major role in our future society.

Spurred on by the global pandemic, most of us now feel comfortable interacting with one another virtually. As the old adage goes, necessity is the mother of invention.

But even if you discount the pandemic as a catalyst, with billions of dollars being invested in the metaverse, it seems inevitable that more of our interactions are going to take place within digital spaces in the future.

What’s more, as research and development continue to progress and metaverse-related technologies get even more powerful, the line between ‘virtual’ and ‘reality’ is likely to become increasingly blurred.

The upshot is that anyone who doesn’t keep pace with these advancements is likely to leave themselves at a disadvantage in the longer term.

In the not-too-distant future, having no presence in the metaverse might be akin to attempting to pay for all your goods and services using physical cash today: not impossible, perhaps, but increasingly difficult.

Make no mistake, the metaverse has arrived and it’s here to stay – and that’s why it matters.