Insights: The metaverse and NFT relationship

Recently, the metaverse has developed as an astonishing and exciting phenomenon. The technology has captured the attention of worldwide celebrities, artists, sportspeople, companies, and business owners and established itself as a significant and influential game-changer. Large amount of money is streaming into the metaverse, and many enthusiasts and domain experts anticipate this trend will continue to increase. The worldwide metaverse industry is expected to surpass $1,607bn by 2030, with a CAGR of 43.3 per cent. According to research by J.P. Morgan Chase, the metaverse will become an integral part of every industry in the following years, with an estimated market potential of over $1tn in annual revenue.

What exactly is the metaverse?
Popularised by Neal Stephenson’s 1992 cyberpunk book Snow Crash, the metaverse is a virtual network representing dynamic, real-time 3D environments. The metaverse employs cutting-edge technology such as blockchain, non-fungible tokens, social commerce, augmented and virtual reality (AR and VR), and many more. Metaverse platform enables engagement in real-world activities such as playing, working, studying, shopping and socialising with others. The metaverse can influence employee engagement, customer experience, omnichannel sales and marketing, product innovation, and community development.

NFTs contribution to the metaverse
Non-fungible tokens (NFTs) are one of the fastest-growing areas of the metaverse, appealing to people’s curiosity, creative talent, and investment desire for digital art collections. NFTs are digital assets that represent physical things such as art, music, in-game goods, and videos. They are often purchased and traded online using cryptocurrency and are typically encoded with the same underlying software as most cryptocurrencies.

Before NFTs and blockchain technology, there was no guaranteed method to verify ownership of anything online, much alone a digital asset. Now, there is. NFTs are used to prove ownership accurately and transparently, especially in a virtual world; as such, NFTs will continue to play a crucial part in the metaverse economy.

Furthermore, NFTs may serve as metaverse building blocks for several applications, including the “TradArt” universe. This sector is hampered by intermediaries and corporations that do not adequately reward creators for their efforts. NFTs play a part in virtual real estate. In addition to serving as the legal agreement of ownership, NFTs constitute the land and buildings of the metaverse. To purchase, trade, or build land in the metaverse, it is necessary to mint an NFT that symbolises the property.

Virtual marketplaces
Thanks to apps such as VRChat, metaverse discussion spaces are already thriving, and numerous virtual markets serve as a thriving trading ground for NFTs. In the VR marketplace, sellers might give links to samples of online content or mint files. Nike virtual Nikeland is an example of how VR and NFT marketplaces can appeal to various industries.

Play to earn gaming and access to events
Play to earn games in the metaverse makes it possible to earn real money and NFTs.
The only way to establish ownership and transfer games in the metaverse is through NFTs. NFTs can also be used as tickets to exclusive shows, conferences, and other virtual events in the metaverse.

Art gallery
Several museums are now displaying NFT artwork in metaverse. Virtual reality is the most refined conceivable platform for seeing art (short of a physical structure). It’s possible to view it up close and in detail from every angle, having access to various artwork in a much more relaxed environment. Although there are different takes on the relationship of NFTs and the metaverse, where many assume that NFTs are a part of the metaverse, and some think that NFTs are the building blocks of the metaverse, it clear that NFTs serve as a critical concept and play an integral role in the metaverse.

Ola Lind is the chief strategy officer at Future Fintech Group and director of FTFT subsidiary