The Metaverse wants to monetize, but does that require Crypto?

When experts and commentators discuss the potential magnitude of the metaverse economy, large amount of numbers are bandied about. Bloomberg estimates that in-game transactions and micropurchases might reach $800 billion by 2024, while Citi estimates that $8 trillion to $13 trillion would be spent by 2030.

A variety of criteria influence how those purchases will be made and with what form of currency they will be made in. In many respects, the most important element is whether the 3D immersive worlds are based on blockchains or not — that is, whether they use cryptocurrencies or not.

The economic statistics may appear speculative (Citi’s imply 1,000x improvement in streaming), but the present metaverse economy may provide some impressive results. So it’s worth considering how payments function in the two systems and how they differ.

Roblox is by far the most popular extant metaverse. It debuted in 2006, three years before Bitcoin, and has 54 million daily active users, according to reports. It also does not accept bitcoins as payment. Epic Games’ Fortnite, which is primarily a massively multiplayer online game (MMO) that is moving towards a metaverse, is another major. This approach entails adding new lands while luring developers, shops, performers, and other money-making initiatives.

However, the payment currencies used by the two types differ fundamentally. Robux and V-Bucks are currencies developed and managed by the creators in Roblox and Fortnite, respectively. The metaverses employ cryptocurrencies, which means that they are significantly impacted by speculation in addition to their worth in terms of paying for goods in-game.

That, of course, means that the value of the money created by in-game producers and sellers may swing as drastically as bitcoin.

While both blockchain metaverses are currently in beta and don’t have much of an internal economy other from the selling of plots of “land” on which to construct, their token prices have swung drastically along with the larger crypto market. Decentraland’s MANA tokens peaked at $5.90 during the pinnacle of the bull market in November and are presently trading for $0.85. The Sandbox’s SAND has dropped from $8.44 to $1.08 at the moment.

While experts’ reports and celebrities coming in — Snoop Dogg gets a lot of coverage for Decentraland — the metaverse is entirely driven by speculators. And, because both are decentralized enterprises, the creators will have even less influence as the economy expands. They will, however, make or lose money on their own holdings.

Roblox costs creators 25% of a game’s income, but the exchange rate is also heavily discounted. 100,000 Robucks cost $1,000 to purchase. Developers who required at least that many to pay out received $350.

Fortnite boasts 24 million daily active users and over 260 million unique gamers each month. V-bucks are worth $0.01 each, and artists must earn $100 in a year to cash out. It does not have a cryptocurrency, and the Fortnite Tokens currently on the market are “a scam,” according to Fortnite CEO Tim Sweeney.

Decentraland and The Sandbox have made and continue to make a lot of money by selling virtual parcels of property, with some communities being more popular than others. These plots are another aspect of the economy, with “land” speculation already attracting investors, as well as large companies constructing marketing experiences and stores selling NFT in-game commodities like clothes.

However, real estate is viewed as significant enough that Citi Global Perspectives & Solutions’ (GPS) “Home of the Future” study on the real estate sector includes a section on crypto-backed mortgages for virtual land.

How to Earn

Games that users return to and in-game items like avatar apparel are potential huge earners for producers, regardless of platform.

Because of their larger crowd sizes, non-metaverse games dominate during huge events and concerts. With rapper Travis Scott, FortNite kicked off metaverse concerts — and, to a lesser extent, investor conviction in the potential value of the metaverse in general — attracting roughly 46 million people across five live performances in April 2020.

Lil Nas X gained 33 million viewers in four Roblox shows over two days in November. A year later, in six months, Swedish pop singer Zara Larsson sold more than $1 million in avatar clothes and accessories. Roblox and Sony Music announced in March that rapper 24kGoldn will perform a series of concerts and pre-show “fan experiences” that would gather 1.6 million fans.