What Is The Metaverse And How Will It Change Credit Cards?

In late October 2021, Facebook rebranded itself “Meta.”

Oh sure, Facebook is still called “Facebook” and seemingly nothing has really changed. It’s just that Facebook’s parent company (the company that runs Facebook, Instagram, and WhatsApp) is no longer called Facebook, but Meta – a nod to a big bet the social network is taking on the future of the internet – something called “the metaverse.”

You’re probably thinking, So what? Why should I care? This doesn’t affect my life in the slightest.

And you’re right, it doesn’t (not yet anyway), but it might.

In fact, if Facebook and other huge technology stalwarts like Microsoft have their way, it will change the way we do almost everything – from how we interact with each other to how we experience life and the world around us.

If everything goes well for Facebook and Microsoft’s big plans, your body might be in the world you know, but the rest of you will be plugged into the metaverse – just like when Keanu Reeves downloaded kung fu directly into his brain in the first Matrix movie.

Of course, you’ll still go out with friends, shop and pay for things with a credit card…you just won’t be doing it here, you’ll be doing it in the metaverse.

Okay, you’re thinking, enough already. What is the metaverse?

What is the metaverse?

Right now, trying to answer “What is the metaverse?” is like trying to explain the internet in the 1980s.

The tech companies that envision it have several high concept ideas about what it is and what they want it to be, but nobody really knows what any of that will look like in practical reality or how it will transform our world going forward.

The term “metaverse” was first coined in the 1992 Neal Stephenson novel Snow Crash to describe a virtual world that would one day succeed the internet. In the book, people interact inside a virtual world that stands in for the real world, not as people, but as fully functioning avatars that represent them in this virtual landscape.

That description isn’t far off from what people are talking about when describing the metaverse as they see it going forward. Basically a series of interconnected virtual realities that will stand in for (and for some, largely replace) the world we live in today.

Think about it: if you could get all your needs met in a virtual world, would you ever leave it?

Facebook wants to own large parts of this virtual world, along with several other major technology companies, so they’re probably banking on the answer being no.

Is the technology to make the metaverse already here?

Many of us have already seen the metaverse. In movies like Ready Player One and The Matrix, characters live large parts of their lives as avatars in expansive virtual worlds while their bodies are sitting at, or plugged into, a computer somewhere with a virtual reality interface.

But the world has actually gone further than just depictions in pop culture. Games like World of Warcraft, Minecraft, Fortnite, and Second Life already feature exploratory and networked virtual worlds that continue operating 24/7 even after you log off. For these games, there’s no explicit objective. You can do the missions they offer or you can just hang out and explore.

Second Life is probably the closest experience to what the metaverse will be like. People there did the following:

• opened virtual dance clubs that charged a cover fee to watch real DJs mix real tracks they made as virtual versions of themselves,
• built virtual real estate and then sold these homes to other players for real money, and
• browsed virtual shops for custom clothing that they purchased with real money for their avatars.

You’ll be able to do all of that in the metaverse, just taken a step further. Instead of creating 1 avatar for 1 world and then logging off when you’re done to create another avatar in another world, your same avatar will be able to travel between several virtual worlds that all connect as one universe that’s able to host millions of people at once.

Instead of logging into a Zoom meeting at the office, your avatars will join each other in a virtual office building that has several virtual conference rooms with virtual boardroom tables that feature Zoom-like capabilities.

There might even be times where some are attending an actual concert in the real world, while others are watching from home inside the metaverse and they are represented as holograms at the concert itself (this example was actually taken from a Facebook presentation on the metaverse).

Technologies like augmented reality – where you see digital representations depicted in the real world right in front of your eyes – or just video of your real self may also be integrated into the metaverse at times, so you won’t always been seen just as an avatar and the world that surrounds you, at times, won’t always be entirely virtual.

But if all of this existing technology will blend together to create the metaverse, there needs to be a heavy technological infrastructure investment made in the real world to support it.

Layers of the metaverse

If the metaverse is going to exist as a shared virtual world with millions of avatars milling around together and carrying over digital assets from one virtual place to another – a process called interoperability – it’s going to need the following technological elements in the real world coming together in tandem to make it possible.

These elements can be broken down into 7 distinct layers that were first suggested by Jon Radoof, a game designer, author, and entrepreneur who writes the Building the Metaverse blog:

• Infrastructure – technologies for connection like cloud, Wifi, 5G, and hi-tech materials like graphic processing units (GPUs).
• Human interface – VR headsets, AR glasses, haptics to simulate touch and motion, and other technologies users will need to enter the metaverse.
• Decentralization – Blockchain, artificial intelligence, edge computing, which is a paradigm that brings computation and data storage closer to the source of the data, and other tools of democratization.
• Spatial computing – 3D visualization and modelling frameworks to simulate the virtual world.
• Creator economy – An assortment of design tools, digital assets, and e-commerce shops that people can establish in the virtual world.
• Discovery – The content engine which will drive engagement, including ads, social media, ratings, reviews, social proof, and more.
• Experiences – VR equivalents of digital apps for gaming, events, work, shopping, travel and more.

Currently, these elements exist in isolation from each other. But to build a global virtual world, they need to be able to work together on an extremely large scale seamlessly.

There can be no stops and starts, as the act of constantly connecting and disconnecting wrecks the illusion of immersion that being in a virtual world needs if people are going to buy-in.

For a more detailed explanation of how these elements will come together to build the metaverse, watch the video below:

Why is the metaverse gaining traction now?

So who is going to bring these elements to the table? Who’s going to pay to enhance these technologies to a point where a frictionless virtual world can actually be realized on a global scale?

This is where the world’s largest technology companies come into play. Their interest in building the metaverse, investing in its massive infrastructure, and believing in it as the next big evolution of the internet is why the metaverse is gaining so much traction in the media and public consciousness.

Of course, as the video above laid out, each of these companies specializes in at least one segment of the technology that the metaverse will need to be successful:

Metaverse investment opportunities

It’s not just the biggest technology companies who can invest in the metaverse. There are also opportunities for smaller players to get in on helping build the metaverse from the ground up.

Grayscale, a giant in cryptocurrency investment, estimates that the metaverse could be a $1 trillion annual investment opportunity in the following areas:

• advertising,
• digital events,
• e-commerce, and
• hardware.

Already, virtual real estate and land is going for millions of dollars in the smaller browser-based virtual world called Decentraland. Launched in February 2020 by the non-profit Decentraland Foundation, it was created as a reaction to only large corporations vying for ownership of the metaverse.

In it, digital goods and services can be purchased with cryptocurrency, including real estate where a record was set in June 2021 when 259 parcels of digital land (the equivalent of 16 acres) was sold as an NFT for $913,228.20. The buyer was a digital real estate investment firm called Republic Realm.

The UBS investment banking company reports that digital architects are creating luxury villas, office buildings, and even malls in the hopes that they will be rewarded when people start using them inside the metaverse.

In addition to land and property, investors can also invest in the native cryptocurrencies of a variety of virtual worlds that may one day be a part of the larger global metaverse. These worlds not only include Decentraland, but Sandbox (which recently made news when Snoop Dogg bought land there) and Axis, among others.

Investing in this way has the advantage that the currency is already being used inside these virtual worlds for goods and it’s also a bet that the virtual world, or smaller scale metaverse you’re investing in, will be the one that becomes the next big thing and takes off.

This is also a good time to invest in NFTs. Non-fungible tokens may have little practical value in the real world right now, but the more we value digital goods in the metaverse, the more valuable these unduplicatable works will become. What’s an NFT? Find out here.

What about a metaverse stock?

Of course, if you’re looking to invest in the metaverse the old-fashioned way, there are plenty of opportunities to buy stock in companies you think will profit from the building of the metaverse. These can be the technology heavyweights mentioned earlier or small start-ups like Sandbox or Axis, which are hosting and maintaining mini metaverses right now.

Of course big technology companies will likely make a healthy profit as they jockey to stake their claim in the metaverse (you can always invest in them) but there’s still plenty of opportunity for a start-up no one has heard of to become an essential player in this burgeoning landscape.

New jobs in the metaverse

Of course, building the metaverse (and maintaining it once it’s built) will take manpower, so there will be plenty of job opportunities to come for programmers, developers, technicians and more.

In fact, Amazon has yet to announce a monetary investment in building the metaverse, but they are quietly looking for a “Senior Product Manager, Technical (AWS Game Tech)” as of initial writing.

“We are looking for a technical product manager who is passionate about innovating in the games, simulations or cloud services space. This role is an opportunity to join one of Amazon’s newest growth areas by leading projects of strategic importance with very high visibility,” reads the LinkedIn listing.

Meanwhile, Google has created a new hiring and training program (where no college degree is required) to help fill specialized tech positions at a time when tech job salaries continue to rise. They’ve invested US$100 million in a Google Career Certificates Fund.

All of it is to get ready for what tech giants call “Web3” as in the next iteration of the web, which includes the metaverse and is based on concepts that come from blockchain technology, like decentralization.

Metaverse e-commerce opportunities

While buying things online provides unprecedented speed and convenience, you can’t try things on or test things out like you can in a brick-and-mortar store.

The metaverse hopes to bridge that divide for the first time. People will be able to try on and test out digital products, like clothing on their avatars, before the real life equivalent of the product arrives on their doorstep.

The full effect of the metaverse’s impact on e-commerce may not be felt until far into the future, but elements of it exist right now.

Amazon’s Room Decorator option allows customers to see furniture they’re about to buy in their space as if the pieces were actually in the room using augmented reality [AR] technology through their phone.

It’s the same technology that allowed gamers to see Pokemon in their physical space while playing the Pokemon Go mobile game and it’s the type of thing that will be part of the experience at virtual stores in the metaverse.

Currently, glasses company Warby Parker allows you to see how their frames look on you in exactly the same way and you’ll be able to do the same in the metaverse, giving you full confidence in something you technically bought online in an unprecedented way.

The e-commerce experience will be able to be customized and individualized at a scale we’ve never seen before and NFTs will play a key role in creating new digital products we can’t even conceive in our heads.

Imagine using an NFT for exclusive access to an event or as a secure receipt that you did in fact buy a pricey item – these are just some of the ways they will be used in the metaverse.

The bandwagon effect and the fear of missing out

In order for the juice to be worth the squeeze and all this investment in the metaverse to be worth it, the tech giants that are building it need buy-in from the general public. After all, what is an expansive virtual world without the people to play around in it?

No one wants the metaverse to become a “meta-desert”.

This is why they’re using hype to their advantage, full presentations from Meta (formerly Facebook) feature holograms of people attending concerts they’re not actually present for or Mark Zuckerberg in a room that’s not actually there, like a real life Tony Stark.

What Zuckerberg and others are selling you is the dream of what the metaverse could be. They need to create that sense of FOMO to ensure that not only do people want to enter the metaverse, but they can’t help but not to. In fact, they feel compelled to.

The hope is that the metaverse will reach the same level of ubiquity of not just Facebook, but the internet itself.

But the metaverse isn’t all hype. During the dotcom boom of the early 2000s, when many of the predictions were way off and much of the hype was unwarranted, things were new and untested. With the metaverse, we’ve already seen a lot of the technology that will make it up already functioning in our world.

Plus, more than 65% of Gen Zers have already spent money on virtual items inside a video game, while 87% play video games on their smartphone or other consoles, so brands will be going where the kids already are.

Meanwhile, if the metaverse launches without a hitch and mini-metaverses like Sandbox, AXIS, and Decentraland remain popular, then brands will be marketing direct-to-avatar more than they market direct-to-consumer.

How will the metaverse affect you? 5 things to look out for

Just to put the finest of points on what the metaverse means, here are all the parts of your life the metaverse may change forever.

Shopping

In the metaverse, your avatar will enter a virtual store, try on a piece of digital clothing or test drive a digital car and after you’ve purchased it with cryptocurrency in your crypto wallet or with your credit card in your digital wallet, the real equivalent could be delivered to your house.

Plus, the digital goods you buy in the metaverse follow you wherever you go while you’re there, as opposed to how it is now in gaming, where the things you buy in game are only available in that game and can’t carry over to any other virtual environment.

NFTs provide the opportunity to build one-of-a-kind digital products we can’t yet even conceive of. Right now, they can be used as tickets to exclusive events or as receipts to confirm a purchase, but their potential could go beyond that when digital assets become more important.

Shopify is specifically interested in the augmented reality shopping opportunities that the metaverse can afford them, so they’re certainly all about marrying the physical shopping experience with the online one.

Real estate

As you’ve already seen, digital real estate developers are already buying up land inside the mini metaverses that exist today and the purchase price is setting records in the real world.

The metaverse could see digital real estate become even more valuable than terrestrial real estate in the physical world as people may start to purchase homes in both places or recreate their real home in the virtual world for when they visit the metaverse.

After all, you can keep items and see views in your digital home that may only ever be available to you virtually.

Cryptocurrency

We’re already seeing cryptocurrency rise to an even greater place of prominence in mini metaverse landscapes like Decentraland, Sandbox, and Axis because each uses their own crypto coins as the dominant form of currency in their individual metaverses.

It’s probably safe to say that when the global metaverse opens, cryptocurrency will be the way to pay for things inside.

Add to that, the potential for NFTs to be used as special tickets to one of a kind events in the metaverse (or to be used to create a special kind of digital merchandise no one has seen yet) and if you haven’t bought into crypto, you will by the time the metaverse comes along.

Want to know how to buy bitcoin with a credit card to prepare for the coming metaverse? Here’s everything you need to know.

Concerts

When Arianna Grande sang inside Fortnite in the summer of 2021, she joined Travis Scott, Diplo, and Marshmello on the list of artists who’ve performed inside the game.

All of them signalled Fornite and Epic Games’ wider ambitions to contribute to the metaverse where virtual concerts will be the norm.

Sure, you’ll still have to pay to get in (perhaps by purchasing an exclusive NFT) but you won’t have to be physically in the same space as the artist to attend.

Conversely, the metaverse may also enable you to attend a concert or other live event happening in the real world from a video feed inside the virtual world.

Travel

When travelling in the metaverse you don’t actually go anywhere, but you can be everywhere.

This is because developers can create realistic and highly accurate 3D representations of anywhere on or off earth, so you can tour inside a virtual version of the pyramids (a version so much like the real thing you wouldn’t be able to tell the difference) from the comfort of your own home.

The metaverse will even be able to mix in video or audio dispatches from the real location to make it feel every bit as immersive and tactile as it would be if you were actually there in the real pyramids.

How could the metaverse impact the way we use credit cards?

Not only will the metaverse change what we buy, but how we buy it. This includes credit cards. The way we use them to pay for things may be forever altered by the very nature of the metaverse itself.

Below we will discuss not only how credit card payment may change, but how credit cards will likely be used not as vehicles for terrestrial currency, but cryptocurrency.

Crypto debit cards will become even more prominent in society and more readily available.

These cards are already issued by the largest cryptocurrency exchanges, and are prepaid cards that you top up with cryptocurrency from your crypto wallet, or in the case of the Crypto.com Visa, fiat currency as well.

It’s also only a matter of time before you’ll be able to borrow credit based on cryptocurrency and pay down your balance with cryptocurrency exclusively.

Finally, cryptocurrency credit cards will come with rewards. This is also already happening, as the prepaid Crypto.com Visa offers cash back (well, more like cryptoback) through its CRO Rewards Program. Although, many purchase categories are excluded.

Credit card companies will create products geared towards the metaverse

Credit cards will never be the same inside the metaverse since the need for physical plastic won’t be necessary.

Virtual credit cards, and the information contained within, will rise to even greater prominence as your payment information will travel with you in the virtual world.

You won’t need to swipe, you won’t need to tap, you won’t even need to punch in your PIN.

Instead, your card’s payment information will likely be woven into your virtual identity and be accessed through a menu of options related to your avatar.

Having a mobile wallet (and not a physical one) will become essential.

You will use it to authorize microtransactions (those little purchases for digital goods that enhance gameplay in video games, making them more fun, and levelling up your avatar).

Crucially, the concept of ownership will change inside the metaverse, as the digital goods you buy will follow you from one virtual place to another.

Instead of only owning a digital asset like an NFT that’s usable in one game (as it is now), you will be able to use the digital things you own in all of them.

Since we’re talking about the metaverse, everything you do inside the vast virtual world (from gaming, to working, to travelling) will be part of the same virtual world.

One more thing though, you likely won’t be spending money directly inside the metaverse.

The current metaverses that exist now (Sandbox, Decentraland, and Axis) are vehicles to get more people buying and spending cryptocurrency, so you will likely be buying cryptocurrency to exchange for digital goods.

This means your main mode of payment likely won’t be your credit card, but your crypto wallet.

Crypto credit cards will allow you to borrow crypto on credit

Since cryptocurrency will likely be the main form of payment inside the metaverse, the metaverse’s popularity and ubiquity in society may raise the profile of cryptocurrency even further.

This may justify credit cards that offer credit and allow you to pay down the balance with cryptocurrency.

If it happens, that’s a huge evolution in not just cryptocards, but credit cards in general.

Currently, all cryptocards are prepaid cards. As in, you load cryptocurrency onto them from your crypto wallet and they have to be continually topped up.

Options that work this way include:

• Cryptocoin.com Prepaid Visa,
• Coincard Prepaid Visa or Mastercard, and
• Localcoin Prepaid Visa.

Granted, these are limited options that are only dipping their feet in crypto, but if the metaverse is so compelling and so immersive for people and the vision of Zuckerberg and other proponents becomes fully realized, the demand for payment options based on cryptocurrency will balloon.

One of those options will no doubt be borrowed funds paid back with crypto.

Conclusion

The metaverse offers the opportunity not to be on the internet, but in the internet. It’s a fully-realized virtual world as vast as cyberspace.

It will no doubt change how we interact with each other, how we work, how we pay for things, how we travel, and how we shop, but saying all that only scratches the surface of its potential.

What about you? Could you see yourself spending most of your time wearing a VR headset while being plugged into the metaverse? Would you even want to hang out in the metaverse in the first place?

Let us know in the comments below.

FAQ

What is the metaverse in a nutshell?

A tough question to answer since the answer is largely speculative. However, in a nutshell, the metaverse is a vast virtual world as big as cyberspace that will be the next evolution of the internet in that it will be where people shop, game, work and more.

Can you buy metaverse real estate with a credit card?

You can, but indirectly. You will likely need cryptocurrency to make purchases in the metaverse, as smaller metaverses that currently operate all have their own cryptocurrency. Therefore, you will either have to buy bitcoin with a credit card or load a prepaid card with cryptocurrency that you bought with a credit card.

Should I worry about the metaverse right now?

There’s really nothing to worry about. But, even if you are worried about the metaverse for some reason, rest assured that it’s still a long way from being a reality. Plus, it should have a positive impact on all our lives, changing the way we shop, game, travel, and more for the better.

Do you need VR glasses to enter the metaverse?

Yes and likely a virtual credit card if you want to buy any digital goods. Although there will be aspects of the metaverse that you should be able to enter in other ways, such as via video during a Zoom meeting with others who happen to be inside the virtual world of the metaverse.

Is Facebook turning into a metaverse?

Not exactly. Facebook will likely still exist as a social media platform, but it did change the name of the parent company that owns Instagram, Facebook, and WhatsApp from Facebook to Meta as a signal that they are staking their future on this new concept called the metaverse. This means that they will play a major role in building the virtual world that is the metaverse. They have already invested US$10 billion into its creation and own several components that will be crucial in accessing it, such as the Oculus VR headset.