The Non-fungible token (NFT) ecosystem has been making headlines since Beeple sold his NFT collection for $69 million at a Christie’s auction. As per the latest market analysis, NFT sales peaked in 2021 to hit $17.6 billion, a 21000% jump compared to the previous year. This growth has continued in 2022, with more corporations and celebrities taking an interest in the burgeoning NFT space.
So, why have NFTs become popular all of a sudden? Unlike normal cryptocurrencies, NFT assets are indistinguishable (unique) in nature. More importantly, NFTs have proven to be compatible with Virtual Worlds or what is now popularly referred to as the metaverse. This new crypto asset class has introduced the concept of digital identities, enabling human beings to experience Virtual Reality (VR) as avatars.
With more people embracing the metaverse concept, NFTs are becoming a fundamental part of tomorrow’s world. However, not all of the existing collections have a role to play in modern-day VR ecosystems; some are simply designed as collectible digital art while others are in-game items. The next section of this article will take a deep dive into the ongoing developments to paint a better picture of the upcoming digital world.
A Leap Into the Future
First introduced in the 1950s, VR has evolved into one of the most coveted technological advancements; according to predictions by GlobalData, the VR industry will likely balloon into a $28 billion market by 2030. This is not surprising, given that most gaming publishers and tech giants, including the likes of Sony and Facebook have invested heavily in the industry. With NFTs now in the equation, things have gotten more interesting!
There is a new crop of NFT innovations that are built as VR-compatible; to this end, we have Web 3.0 platforms such as Looking Glass Labs (LGL), which specializes in NFT architecture and building immersive metaverse environments. The project’s leading brand House of Kibaa (HOK) designs 3D NFTs, enabling crypto natives to experience multiple virtual worlds and other ecosystem perks like a membership to exclusive NFT releases by HOK.
Besides Web 3.0 projects, the long-standing players in the tech industry led by Facebook (now Meta) have also been making strategic moves into the VR and metaverse space. The firm recently launched a metaverse ecosystem ‘Horizon world’, featuring a VR experience. Additionally, Mark Zuckerberg has previously hinted that Meta is committed to contributing to building a digital future.
“Our role in this journey is to accelerate the development of the fundamental technologies, social platforms, and creative tools to bring the metaverse to life, and to weave these technologies through our social media apps,” noted Zuckerberg in Meta’s 2021 Founder’s letter.
Looking at these developments, one thing is gradually becoming certain; human beings will soon be living in virtual ecosystems. Even better, the experience will be more immersive than the one offered by the existing VR-oriented games. This is because NFTs offer Web 3.0 citizens both an opportunity to participate in a digital world and generate a passive income based on the play-to-earn (p2e) model.
While the idea of living in a virtual ecosystem may still sound foreign to many, it is worth noting that large corporations are embracing the possibility. There has been a notable influx in partnerships between Web 2.0 companies and Web 3.0 platforms. For example, HSBC recently collaborated with The Sandbox, launching its own virtual piece of property.
“The metaverse is how people will experience Web3, the next generation of the Internet — using immersive technologies like augmented reality, virtual reality, and extended reality,” said HSBC’s Chief Marketing Officer, Asia-Pacific, Suresh Balaji.
It is not only HSBC that has high hopes in the metaverse; according to JP Morgan, this space has the potential of growing into a trillion-dollar industry. Above all, the adoption of digital worlds by the gaming community and artists has proven that we are indeed set for a paradigm shift, from physical to virtual interactions.