Does the Metaverse need blockchain to ensure widespread adoption?

While not absolutely necessary, omitting it would be misguided. “The Metaverse without blockchains would likely just advance the ball for Big Tech.”

Many assume, too, that blockchain technology will play a key role in the Metaverse, along with other emerging technologies such as artificial intelligence (AI) and virtual reality (VR). But, is the use of blockchain really a foregone conclusion?

Stanford University professor Jeremy Bailenson recently moderated a World Economic Forum panel with some of the world’s leading thinkers of the Metaverse and blockchain. “The first question posed to the panel was ‘Do we need the blockchain for the metaverse?’” Bailenson, founder of Stanford’s Virtual Human Interaction Lab, recounted to Cointelegraph. “The consensus was that the Metaverse could exist without blockchain.”

As an example, Bailenson offered up metaverse pioneer Second Life, founded in 2003, which has 70 million current registered accounts and is adding another 350,000 new accounts each month to its online multimedia platform. Second Life has developed “a robust economy where digital assets are bought and sold,” said Bailenson. “The typical GDP of Second Life is about half a billion dollars each year. And, the world runs robustly without using the blockchain.”

“Could the next iteration of the internet exist without blockchain technology?” asked Tonya Evans, professor at Penn State University’s Dickinson Law School. “Yes, it could,” she told Cointelegraph. After all, distributed decentralized ledgers and cryptographically-secured assets — including smart contracts — are only one part of Web3 technology, along with AI, 3D printing, VR, augmented reality, the Internet of Things (IoT) and others.

Many are thrilled at the prospect of the Metaverse with its virtual worlds that can be used to play online games, but also to train surgeons on 3D organ models and enable students to visit recreated villages in ancient Greece astonishingly brought to life.

Exclude it at your peril

But, omitting blockchain technology, while doable, could still be a mistake. “The Metaverse without blockchains would likely just advance the ball for Big Tech,” added Evans, and it would come at the expense of those same people left behind by Web2 — “the very people a truly decentralized web would empower.”

Yonatan Raz-Fridman, founder and CEO of SuperSocial — which develops games for the Metaverse — agreed that blockchain technology is not absolutely necessary. “No, you don’t need blockchain to enable the Metaverse,” he told Cointelegraph. There is no a priori reason why avatars can’t be created in 3D and games played with closed platforms, like Second Life’s.

But, Web3 is arguably a reaction against the FAMGA companies — Facebook, Apple, Microsoft, Google and Amazon — with their privately-owned platforms, and Raz-Fridman predicted that companies like Meta will have to compromise on the matter of interoperability if they expect to participate. This means allowing avatars to freely travel from one Metaverse project to another — along with all their digital clothes and jewelry. As NYU marketing professor Scott Galloway put it recently:

“Why buy clothes if you can’t wear them out of the store? Why buy a Birkin bag if you can’t show it off in the Metaverse?” 

Consumers are now demanding a Web3/Metaverse more like that depicted in Neal Stephenson’s 1992 novel Snow Crash, added Raz-Fridman, “where everyone owns their digital assets and has the freedom to bring them with them as they move from one place to another.”

Interestingly, novelist Stephenson himself is the co-founder of a recently launched metaverse project Lamina1, “that will use blockchain technology to build an ‘open metaverse’ — one that’s open-source and decentralized,” the Washington Post reported.

All about people, places and things

The Metaverse is an elusive term — various parties define it differently. Most agree, though, that it involves immersive three-dimensional virtual worlds with lots of games and role-playing. Bailenson, for his part, finds it useful to break the Metaverse down into people, places and things. In each of these areas, he sees a potential role for blockchain technology.

“People are avatars, the bodies we wear while immersed in the digital world,” he explained to Cointelegraph. Here, blockchain technology can provide the “crypto DNA” that “ensures a one-to-one mapping of person to avatar.” For example, it could be used to guarantee that an individual can’t inhabit ten avatars simultaneously or enable someone else to “take my own avatar for a joy ride.” Added Bailenson:

“While an obvious application of blockchain will be to verify clothes and jewelry for an avatar, I have always thought the killer app here is documenting and verifying human animations.”

Places, in Bailenson’s conception, are set areas in a grid of a virtual world. For the Metaverse to work, a world “needs to be persistent: it is there, even when you aren’t, and consistent: if you buy a plot of land one kilometer from Snoop Dog, it can’t move farther away based on an arbitrary remapping of the world.” Some platforms are already using blockchain technology to document these maps, he noted.

Finally, the most obvious application of blockchain technology is in Bailenson’s realm of things, which includes three-dimensional models, two-dimensional images, sound files “or any digital asset that can be housed within a virtual world.” Blockchain technology can be used to verify transactions “without a centralized body overseeing the transaction” and also ensure “that items have unique value based on the supply — one can’t just make thousands of copies to counterfeit an asset.”

A need for interoperability?

As things stand now, major Metaverse players and/or contenders — including Sandbox, Decentraland and the FAMGA companies — “offer very little interchange between their web platforms and other platforms,” Lik-Hang Lee, assistant professor at the Korea Advanced Institute of Science and Technology, told Cointelegraph. This lack of interoperability, characteristic of Web2, is a shortcoming that needs to be addressed if the Metaverse is to reach its full potential. This includes, at a minimum, the following elements, according to Lee:

• Anyone should be able to build a virtual world that can link to the rest of the Metaverse;
• Any device or browser should be able to access the Metaverse provided it meets with certain predetermined specifications;
• Ownership of digital assets should be recorded and preserved across multiple servers and clients;
• A single avatar should be able to communicate with avatars on other servers;
• People should have the ability to produce, show, buy and sell their digital assets within the Metaverse.

“In light of the growing number of metaverse initiatives that are incompatible with one another, it is more important than ever to build standardizing organisms,” Lee told Cointelegraph.

Interoperability may not come easily, however. Meta, Google and others “will fight hard not to lose their dominance,” said Raz-Fridman. It may also take time for the public to understand just what is entailed in a user-owned internet, but when they do, “consumers will demand to be more in control.” FAMGA companies will have no choice at that point but to yield, at least somewhat, on interoperability.

Raz-Fridman was asked why crypto people, in particular, seem to be so interested in the Metaverse. Is it because they think it will potentially boost cryptocurrency adoption? “If you look at it historically, there has always been a struggle over the narrative — different versions of what the world should look like,” he answered.

At one extreme are the crypto maximalists who envision a decentralized, blockchain-based and open-source world where people own and control their data and digital assets. Raz-Fridman has sympathy for this position, but ultimately he doesn’t think it will prevail, overall, at least. Facebook, Google and others “own a large piece of economic activity over the internet, and they won’t be toppled overnight.”

By the same token, the continuance of private, closed platforms isn’t realistic either. In the short-term, one might expect a sort of “clash of civilizations” between the two visions, continued Raz-Fridman, with an eventual middle ground emerging as consumers themselves decide the extent to which the Metaverse is decentralized.

Meanwhile, as the Metaverse further evolves, Bailenson expects to see lots of gratuitous uses of blockchain technology “where the technology works, but is not essential.” As more time passes, though, “there will emerge a set of killer apps where blockchain is the only way to do the job right,” Bailenson told Cointelegraph. 

All in all, a Metaverse without blockchain is both thinkable and doable. But, “if the goal is the democratization of the Internet, not to mention accessibility, transparency, composability and platform interoperability,” Evans said, “then the Metaverse must include blockchain.”