Metaverse: What businesses need to know

1 min read

The word’s etymology is derived from the Greek term ‘Meta’, meaning after or beyond, and the English word universe.

While the word was coined by Neal Stephenson in his 1992 novel “Snow Crash”, the concept of Metaverse is one that surfaced into our daily lives in the past year, following the deployment -or intention of deployment- of various virtual worlds by numerous organisations, such as Meta (ex-facebook) and The Sandbox, acting as another dimension of the blockchain ecosystem.

Following the recent rise of blockchain and distributed ledger technology (DLT) that started with Bitcoin in 2008, followed by other cryptocurrencies in the years to follow and other byproducts of the DLT such as Non-Fungible Tokens (NFTs) and Decentralised Finance (DeFi), it has allowed individuals and businesses to explore new technological infrastructures.

These innovations allow them to navigate a new type of decentralised economy without any intermediaries.

Being an extension and augmentation of the physical world, Metaverse is an immersive reality network of synchronous 3D virtual spaces where one can connect and simulate experiences with other users.

It is a digital universe that incorporates augmented and virtual reality (AR & VR) elements, enabling users to wander around virtual worlds, including cities, nature landscapes and shopping malls, and allowing them to meet, purchase, communicate, shop and learn through an avatar.

What does the future hold?

Some of the world’s largest companies, such as Microsoft, IKEA, Amazon, Apple, Coca-Cola, Gucci and Nike, have already started investing time and money in the metaverse with numerous initiatives to amplify existing products and services or develop new ones.

Metaverse comes only as the natural progression of this technological evolution in the era of what is considered to be the 4th industrial revolution (Industry 4.0).

Although the first seeds of the technology have been more evident in the gaming industry, with virtual worlds such as Second Life (2003), Minecraft (2011) and Fortnite (2017), the concept of Metaverse will undoubtedly have a significant impact in all businesses and industries.

It will have the ability to enhance the overall customer experience, acting as a bridge between the digital and physical world and allowing organisations to identify opportunities for new or enhanced existing products or services.

The convergence of emerging technologies, such as IoT, machine learning, and virtual and augmented reality on a distributed ledger, creates new opportunities for the business world. Through those capabilities, companies can see beyond the traditional way of contacting their business by reimagining their branding and promotional activities, establishing new selling and distribution channels, and creating virtual economies around their products and services.

By Charalambos Sergiou, Partner, Blockchain & Tax Advisory, Dimi Constantinides, Manager, Experience Center, PwC Cyprus

This content is for general information purposes only.

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