Does Crypto Need Metaverse to Survive The Turbulent Times

Does Crypto Need Metaverse to Survive The Turbulent Times

Let's talk reality first, Crypto is considered legal tender in two countries for now - El Salvador and Central African Republic, some consider it a traditional investment lever, while other use it as a hedge against market shifts (like gold). Crypto therefore, could be considered mainstream. Metaverse on the on other hand is too nascent and lacks even a common definition of what it may be. A standards body has been formed to define Metaverse, but it's early days. With Web3, Crypto and Metaverse start converging. Consider some facts:

1. Metaverses like Decentraland, Sandbox and other, have their own currencies.
2. 50K+ people are actively engaged in Web 3.0 virtual worlds.
3. Approximately 19 active unconnected Metaverse projects are in play.
4. As of 2021, ~21% of the global population owned crypto
5. Coinmarketcap has 9931 cryptocurrencies currently being traded on 293 exchanges.

Consumer Behavior Impact Crypto & Metaverse:

As business enable offerings that tie the virtual and real worlds, think McDonald, consumers will become comfortable spending their currency of choice in each environment, leveraging digital wallets. One of the inhibitors to mass adoption of crypto is the dilution of the market with so many crypto currencies options in the market. Similarly, since the current Metaverses are disjointed, consumers have to comply to the platforms choice of crypto vs what they have in their wallets. To elaborate on this complexity, imagine that for each box stores like Walmart, Target, Sprouts...etc, required the consumers to transact in their currency of choice. 

Another challenge with crypto is the value associated to currencies. This can akin to how Euro created a common value for all different currencies that exist in Europe and became an acceptable tender. This is what crypto lacks right now, standards. Given that crypto is driven by decentralization as it's basic tenant, a governing body could create a common chain, where all transactions can be managed. DAO and DeFi are examples of governing bodies, bound by smart contracts. 

Current & Future Reality Then?

Crypto and Metaverse are both in early phases of maturity, where Metaverse is probably lacking a bit behind. Yet, for Crypto to become mainstream, it needs a partner, in form of Metaverse. Many global economic forecasts are predicting cashless societies by 2030, implying all currencies will be digital, and crypto is a digital currency. 

As Gen-Y & Gen-Z are more pre-disposed to a mix of virtual and physical, crypto may see a mass adoption, as Metaverse starts to mature, which may line with 2030. Additionally, 76% of financial institutions are suggesting that they will use crypto within the next three years given that it has the appropriate regulatory framework.