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Metaverse cryptocurrencies and how they work

The metaverse is a virtual universe that allows users to replicate their real or physical world experiences on a virtual platform by creating their avatars. The concept gained traction in the aftermath of the COVID-19 pandemic due to restrictions on physical gatherings and meetings.

The metaverse allows people to work, shop, exercise, do business, buy land, or even make art in a virtual environment.

But like any economy needs a currency, the metaverse, which is also a fully immersive virtual economy, needs a method of payment. Since all activities and interactions in the virtual world are done through a user avatar, it is not possible to transact in fiat currency (traditional paper money).

So how do you buy land or a work of art? This is where cryptocurrencies come in.

Some metavers are already using cryptocurrency as a means of payment. The use of cryptocurrency makes all virtual transactions spontaneous, and the blockchain technology that powers them makes transactions highly secure and trustworthy.

Metaverse and blockchain-based apps like Decentraland, Axie Infinity, and SecondLive allow users to own virtual land, play to win, and experience much more.

Digital assets can be held through non-fungible tokens (NFTs) which are just crypto tokens in which the ownership details of virtual assets are encoded. An NFT can even take the form of digital art, any game property, etc.

A look at some of the biggest Metaverse cryptos

• Decentralized (MANA): Decentraland is a virtual reality space that allows people to buy / sell, maintain and manage a virtual property called LAND. In this metaverse, people can develop their TERRAIN in any way that suits them, whether it’s by phone, laptop, or desktop.

Decentraland MANA is the native in-game crypto that one must own and transact to pay for the goods and services that they choose to use in the game.

MANA is based on the Ethereum blockchain and has been well received by the masses (including novice users), boosting its value by 400% shortly after Facebook rebranded itself as Meta. It also sparked a whole new level of interest in cryptocurrency.

• The sandbox (SAND): Sandbox is another virtual world that allows people to manage virtual land as well as other digital assets through an alternative but native metaverse cryptocurrency called SAND. The digital experience can be easily monetized online using this cryptocurrency.

Sandbox is unique in that it allows people to use SAND with complete freedom, whether it’s conceptualizing their own game, using it in other games, or managing other virtual assets. SAND is also powered by the Ethereum blockchain which makes it very safe and secure. Additionally, SAND is backed by SoftBank through its Vision Fund, one of the most popular technology investing names in this space.

• Star Atlas (ATLAS): Star Atlas allows people to explore virtual alien space in which they can use a custom spaceship to access an incredibly unique metaverse, create their own virtual world, and create or join a faction. These in-game activities are enabled by the ATLAS Metaverse token on the Solana blockchain, which is much cheaper, faster, more secure, and even more scalable than the Ethereum blockchain.

ATLAS can also be deployed to obtain an in-game currency called POLIS, which might become a boring aspect for some, but it also allows people to have additional experiences virtually that become activated through POLIS.

There are dozens of other cryptos associated with multiple virtual platforms or metavers.

The metaverse and cryptocurrencies work in close association and unleash a vast possibility of experiences that can only be experienced virtually. The blockchain platform not only adds security and safety to digital transactions, but also opens up the concept of virtual ownership of assets, which was previously a less explored field.

However, since these platforms are still in their infancy, users should exercise caution as most of them are unregulated.

(Edited by : Kanishka Sarkar)

First publication: STI


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