The metaverse may not be living up to the lofty promises that captured the attention of enthusiasts.
The metaverse, an interconnected system of digital worlds built on blockchain technology and digital tokens, was envisioned as a new frontier for creativity and economic opportunity, but key measures of its value, such as the prices of non-fungible tokens (NFTs) and other tokens associated with platforms, have been on the decline, Bloomberg reported Wednesday (Aug. 7).
One popular metaverse platform, Decentraland, has seen its property values plummet by nearly 95%, accompanied by a decline in its user base of about 90%, according to the report.
Meta Platforms’ Reality Labs has also struggled in this space, reporting a quarterly loss of nearly $4.5 billion, the report said.
Tokens.com, a company that invested heavily in the metaverse, saw the value of its virtual real estate portfolio drop by 80%, per the report. This prompted the firm to shift focus to developing silicon humanoid robots instead. It has rebranded itself as Realbotix.
TerraZero Technologies, which aimed to offer metaverse property loans, had its first and only mortgage returned at cost due to the collapse of the metaverse market, according to the report.
The complexity of cryptocurrencies and NFTs is another challenge facing the metaverse. Many believe that these technologies are still too complicated for the average person, hindering widespread adoption, per the report.
James Casey, an associate professor of computer game design at George Mason University, told Bloomberg that a metaverse running on fiat currency would be more appealing to the general public and businesses, as people still desire to own virtual items and see the metaverse as a new frontier of ownership.
PYMNTS reported in June that the killer use case of the metaverse may not be consumer-focused at all; it may be B2B-centered.
Industrial metaverse solutions can help streamline B2B processes and global commerce by allowing suppliers to showcase their products in a virtual space and giving buyers a chance to interact with products in a simulated environment.
For example, digital twins can enable suppliers to offer highly customized products and services by simulating and adjusting to specific buyer requirements before physical production.
