August 1, 2022

Metaverse Highlights: Week of August 1, 2022

This week, industries continue to discover new use-cases for the Metaverse. Bain publishes a study showing that young gamers are embracing the Metaverse; Tiffany’s is launching an NFT collection; the US army doubles down on its Synthetic Training Environment (STE) program; and Sequoia Capital opens a New York office to focus on web3. At the same time, challenges continue to accumulate: Matthew Ball says Apple is stifling the Metaverse, and Robinhood’s crypto unit was fined $30 million by New York’s top financial regulator. This double-movement – positive and negative – shows that the Metaverse remains in a stage of constant experimentation, as actors discover new potential use-cases while preparing for the dangers of the internet of tomorrow. 

Mastercard sees crypto and data as the future.

  • Mastercard Inc.’s chief financial officer Sachin Mehra is helping the payments processor diversify its products while expanding its reach in areas such as e-commerce and crypto transactions.
  • Mehra says innovations bring opportunities, and the company needs to “fail fast.” 
  • Mehra told Bloomberg: “In the crypto world, we play the role as an on-ramp, with people using our debit and credit products to buy crypto. And we act as the off-ramp: When people want to cash it, we help them gain access to be able to use their crypto balances everywhere Mastercard is accepted. That’s a revenue-generating capability which has been fairly successful ever since crypto environments came up.”

Bain: Young gamers are embracing the Metaverse.

  • Young gamers (age 13-17) are the most eager consumers of metaverse-style games, according to a recent study from Bain & Company. 
  • Metaverse games incorporate 3D virtual worlds, an avatar stand-in for the player, and focus on social connection. Currently popular games in the category are Minecraft, Fortnite, Roblox, and World of Warcraft.
  • “There has been a lot of buzz, and plenty of confusion, among the business community on what the metaverse is and how it will shift commerce and life into the digital realm,” said Andre James, global head of Bain & Company's media & entertainment practice. “Meanwhile, young gamers have been paving the future of the metaverse. They have adopted to metaverse-style games, often preferring to socialize with friends in games more than in person.”
  • Further aided by the pandemic, video games have grown to dominate the media landscape of young people. They are the first choice of entertainment for people ages 13 to 17, according to Bain’s report, beating out social media, TV, and music.

How NFTs can boost fan engagement in the sports industry.

  • Nonfungible tokens (NFTs) have grown a lot in popularity since the release of CryptoKitties in 2017, with the sector expected to move over $800 billion in the next two years.
  • When it comes to sports, fans feel so strongly about their favorite player or teams that they interact with them in every way possible. 
  • Sports leagues, in particular, have noticed the value of fan engagement and have gone on to create platforms where fans can buy, own and trade digital keepsakes. One well-known example is the National Basketball League’s NBA Top Shots NFT marketplace, where fans can buy, sell and trade basketball video clips. Video clips on the platform are known as NBA Top Shot moments, and each one shows a different highlight from a basketball match. The marketplace launched in 2020 as a joint venture between the NBA and Dapper Labs, the creators of CryptoKitties. It generated over $230 million in sales within a year of its launch.

Tiffany’s reveals first NFTs — at $51,000 each.

  • Tiffany & Co., one of the most prominent names in luxury goods for over a century, is launching a series of NFTs. The jeweler hinted at its upcoming sale, set to begin August 5, by tweeting out a video of a pixelated grid revealing: NFTiff.
  • The tweet also specified a price of 30 Ethereum (just over $51,000 at today’s price). The website says the offering will have a limited supply of 250. The NFTiffs, the first NFT product offered by Tiffany & Co., are being introduced after the company has flirted with diving deeper into Web3 for months.
  • In March, Tiffany & Co. ventured into the NFT space for the first time with its purchase of an Okapi NFT from Tom Sachs. The luxury goods retailer reportedly purchased the NFT for $380,000 and has since set it as the company’s profile picture on twitter.

VentureBeat: The U.S. Army, not Meta, is building the metaverse.

  • In terms of industry progress towards the cloud-supported, scalable metaverse, no organization has come further than the U.S. Army. Their Synthetic Training Environment (STE) has been in development since 2017. The STE aims to replace all legacy simulation programs and integrate different systems into a single, connected system for combined arms and joint training. 
  • The STE fundamentally differs from traditional, server-based approaches. For example, it will host a 1:1 digital twin of the Earth on a cloud architecture that will stream high fidelity (photo-realistic) terrain data to connected simulations. 
  • The military metaverse could be a microcosm of what may soon be a large-scale, open-source digital world that is not controlled or dominated by a few commercial entities.

Using NFTs to protect the heritage of popular cities around the world.

  • NFTs are the ‘keys’ and Metaverse is the ‘door’ to the world of Web 3.0, an improved and latest version of the Internet. And here, we see the world swiftly transitioning towards that realm, leveraged by the latest technological advancements, as the French city of Cannes sells its landmarks as NFTs to find integration in the metaverse.
  • Cannes, a majestic city famous across the world for its prestigious film festival, is the home to some of the most exquisite architecture in France. Ten of its emblematic locations, including the Croisette and the Palais des Festivals, went on sale led by Artcurial. 
  • Arnaud Oliveux, auctioneer for Artcurial, said:- “Until now NFTs have been limited to graphic creations. For the first time, we have put on sale NFTs linked to real estate locations.” What is really intriguing is the fact that the 3D models and NFTs offered to the bidders can eventually integrate into the metaverse, facilitating them to host virtual cultural events.

Sequoia Capital to open New York office, its first U.S. outpost outside Silicon Valley.

  • Sequoia Capital, the Menlo Park, Calif.–based venture capital firm known for its early investments in Google and Instagram, plans to open an office in New York City, its first U.S. facility outside Silicon Valley. 
  • The move by Sequoia underscores a broader shift by venture capitalists to plant roots outside the San Francisco Bay Area following the pandemic-fueled boom in remote work, which spurred more founders to start companies in other regions and cities, including New York, Austin, and Miami. 
  • This move comes after silicon valley venture firm A16Z announced its intentions to open multiple office locations outside of the Bay Area, including Miami and Santa Monica. 

Is the Metaverse a safe space for all?

  • The collective internet is grappling with misinformation, toxicity, and censorship. In countries all over the world, this is exacerbated by social media networks being restricted or even controlled by the government.
  • Not only does this damage the foundations of free speech and collaboration that the Internet was built on, but it also estranges entire demographics from being able to participate in global dialogue and understanding.
  • While the early iterations of the metaverse have started to face similar challenges, it also holds a promise for a more decentralized architecture of the web, which could help to mitigate some of these issues. On the legacy Internet, content can be easily tracked, controlled and censored—but Web3 could create a more secure way of authentication and thus enable the creation of truly protected digital speech.

Apple is stifling the Metaverse, says Matthew Ball.

  • Matthew Ball, managing partner of Epyllion Co. and author of “The Metaverse and How It Will Revolutionize Everything,” talked to CoinDesk about the role of the tech giant in the field.
  • While Apple appears to be in a position to “thrive in the next era” of more immersive computing, its control over distribution may be crimping the industry, Ball said.
  • “Apple does not allow for crypto-based virtual worlds,” Ball said. “They're successfully stymieing a specific type of disruptive innovation and category.” By steering clear of complex virtual worlds, the tech giant is exerting undue influence over “what is available and what isn’t,” Ball added.
  • The metaverse is not the only sector Apple has seemingly crowded out of its influential app marketplace. It has taken a conservative stance toward crypto and porn, for instance.

Robinhood’s crypto unit fined $30 million by New York’s top financial regulator.

  • The New York State Department of Financial Services imposed a $30 million fine on the cryptocurrency trading unit of online brokerage Robinhood Markets Inc. for alleged violations of anti-money-laundering and cybersecurity regulations, in the department’s first crypto enforcement action.
  • The New York State financial regulator said Tuesday that Robinhood Crypto LLC failed to maintain and certify compliant anti-money-laundering and cybersecurity programs. 
  • The settlement was the latest headache for the mobile investing firm, which achieved mass popularity during the Covid-19 pandemic. Robinhood’s monthly active user count dropped 25% in the first quarter from last year’s quarterly peak, while its revenue dropped 47%. The company has shifted its focus from rapid growth to cost-cutting, laying off 9% of its staff earlier this year.

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