Why investors must know about the relationship between Crypto, NFTs, and the Metaverse
In today’s time and age, hearing the word blockchain, cryptocurrencies, NFTs, is common. Each day more and more investors are moving towards these virtual and digital assets as they are very difficult to be manipulated by the Government.
There are thousands of cryptocurrencies currently in operation, with Bitcoin and Ethereum being the most popular ones. All crypto operates via blockchain, which is a digital and decentralized system. A blockchain comprises of digital information blocks stored on multiple computers database.
All transaction information is present on the blockchain, and it has rapidly become an important part of the global economy.
Crypto and Blockchain are the Future
Reports suggest that global expenditure on the blockchain will exceed $105 billion by 2028. The technology offers far more utility than the usual financial services, with many investors looking at cryptocurrencies, NFTs, etc., to enhance their investment profile.
Anyone looking to invest in these must know about what they are and their relation to each other. The metaverse is currently in development, but still, many organizations have started working towards it. There is a lot of scope and potential for crypto, NFTs, and other digital assets in the metaverse.
These entities are different from each other but still related and dependent on each other. Let us take a look at what the metaverse really is.
The Metaverse is basically a virtual world or a representation of the world in a virtual manner. Users can create their own avatar for the metaverse with a custom appearance, clothing, and other features. These human avatars can visit places, interact with other avatars, attend live events, etc., virtually in the metaverse.
There are many companies trying to build metaverses, each with its own set of protocols and rules. The main focus behind these virtual worlds is to overlap digital and physical lives into one.
Cryptocurrencies were mainly used for real-world transactions over the blockchain, but these digital assets can also be used to store or exchange value in the virtual metaverse. Similarly, NFTs allow the purchase and sale of digital art over the blockchain. Through various processes and operations, an NFT has an owner, and copying or printing the original artwork does not transfer ownership.
NFTs in the Metaverse
With NFTs and cryptocurrencies, a person can have total control of their digital assets within a metaverse. The blockchain offers ownership confirmation within the virtual world for these assets. For example, if you buy land in New York, you will get an NFT for it as proof of ownership by the metaverse, and the blockchain guarantees it.
NFTs can also provide realistic social experiences, exclusive environments and help the digital community progress. Many premium NFTs offer access to the wealthiest communities across the digital world along with valuable collectibles, rewards, and perks. CryptoPunk and Bored Ape Yacht Club offer offline parties and protected content to premium digital communities.
Crypto in the Metaverse
A metaverse is basically a real world, and cryptocurrencies replace money in this world. Every metaverse has custom crypto tokens through which a user can buy NFTs, avatar clothing, virtual real estate, etc. MANA is Decentraland’s token, and you can purchase or sell anything with MANA on Decentraland.
Crypto essentially serves as a bridge between the metaverse and the real world. People can calculate their digital assets’ value in real money and how much returns they can get over time. Crypto is highly liquid on global exchanges and lets investors directly sell NFTs and tokens to buyers in the real world and make profits.
Ethereum Plays a Major Role in the Relationship Among the Metaverse, Crypto, and NFTs
After Bitcoin, Ethereum is the second-biggest cryptocurrency, and many creators use it to develop their metaverse platforms. Many crypto tokens like SAND and MANA don’t have their blockchain and make use of Ethereum’s blockchain for their operations and transactions verification.
Also, the world’s biggest platform for NFTs, OpenSea, works mainly through Ethereum, and most of the NFTs globally can be bought through Ethereum. Thus, Ethereum is the main force behind many up-and-coming technologies and one of the rare blockchains which allow NFTs, crypto, and the metaverse to interact with each other.
The Metaverse has the potential to change how people perceive the world. Many companies are getting into it because of its huge potential in the digital technology space. The metaverse can change how people live, socialize with others, buy stuff, attend real events, and this offers a big chance for crypto to blow up, as crypto will be the main medium of exchange in the metaverse.
Not just crypto, NFTs are also going up. Major brands like Nike, Gucci, Louis Vuitton, Burberry, etc., are entering the NFT space, and soon, we will see digital fashion going toe-to-toe with real fashion.
Investors should know about the metaverse and how they can leverage the power of crypto and NFTs to make money. The future is now, and we as humans need to adapt to this technology.