Chances are you’ve heard the recent buzz about the metaverse. And it’s hard to find someone who’s escaped the buzz about NFTs, or non-fungible tokens. With major metaverse headlines , including Facebook’s rebrand to Meta, it’s been hard to miss.
Whether you’re stoked or skeptical it’s inescapable at this point: the three-dimensional virtual reality that’s being built has stirred a lot of commotion. NFTs are one of the most important components of the metaverse experience.
It’s easy to feel confused about what it means and how it works. Here’s a starter guide on how NFTs operate in the metaverse, including details on POAPs, wearables, virtual real estate, and more.
What, exactly, is the metaverse?
What even is the metaverse, anyway?
If the idea has you baffled, you’re not alone and with good reason. The idea of the metaverse, as hot as it is, is still in the process of being sculpted and shaped. It’s being imagined and crafted in real time. While pieces of it are already available for exploration, it stands to grow much larger.
In short, the metaverse is an alternative, digital reality: a kind of virtual, three-dimensional space where people play, relax, interact, and participate in day-to-day activities. The metaverse can be accessed using virtual reality headsets. You can build out an avatar to create a metaverse version of yourself (or, ostensibly, anyone you might like to be).
The metaverse does, and will, include plenty of carry-overs from real life: people attend events and concerts, shop for products, and even buy real estate in the metaverse.
In other words, along with a social space, the metaverse is also a marketplace with its own economy. And that’s where NFTs come into play.
What are NFTs?
As mentioned, NFT is short for non-fungible token
A token, in this sense, is a kind of digital asset, such as a still image, GIF, or video. Non-fungible means it’s 100% unique: it can’t be replaced by something else. Fungible tokens exist, too. If you hold most any type of cryptocurrency, you’re the proud owner of a fungible token. All Bitcoins are interchangeable and worth the same amount (depending on the market value), so if you traded one for another, you’d have the same thing. That’s not true of non-fungible tokens, which are, by definition, one-of-a-kind.
To offer a “real world” analogy, let’s think of dollars and sweaters. Dollar bills are fungible: one can be interchanged for another without any value being lost (unless, of course, your dollar was signed by a celebrity, at which point it becomes unique). But your grandma’s hand-knit sweater exists one time and one time only. You couldn’t trade it for something equivalent, and she couldn’t replicate it exactly, even if she tried.
NFTs have existed long before the metaverse: some accounts date them back to 2014, when a digital artist named Kevin McCoy released a digital image known as “Quantum.”It was later sold for more than $1.4 million at a Sotheby’s auction. Today, most NFTs are enabled by the Ethereum blockchain—which, of course, also supports the cryptocurrency called Ether. Both fungible and non-fungible tokens, along with cryptocurrency and other types of digital assets, have an important role in the metaverse.
How do you get NFTs in the metaverse—and why?
Since the metaverse is digital space, and NFTs are unique digital tokens, they’re the perfect vehicle for all sorts of virtual interactions and trades. A user who already owns NFTs in the form of digital art might display them in a metaverse art gallery or trade them with other collectors. ; Companies who establish a brand presence in the metaverse might create NFTs of real-life products (or metaverse-exclusive ones). Case in point: Nike acquired RTFKT Studios, a company that creates blockchain-authenticated digital collectibles, to create a line of metaverse sneakers.
NFTs in the metaverse might be wearables (like those Nike sneakers and other fun clothes and accessories to help you customize your avatar), objects to place around your metaverse home, or even metaverse real estate itself. Yes, metaverse mortgages are already being offered by multiple companies to help users acquire property in virtual space—and given that one plot of digital “land” sold for $2.4 million USD last fall, you may end up needing one if you want a digital space to call home.
Fungible tokens, like cryptocurrencies, will also have a place in the metaverse. They’ll allow users to buy NFTs and other digital assets from each other and also to build wealth. Creating a digital wallet is one step to fully experiencing the metaverse. Not only does a digital wallet allow you to safely hold digital assets, but it may also be necessary in order to save your progress in certain metaverse worlds and scenarios.
What about POAPs?
There’s another specific type of NFT to know if you’re planning to adventure in the metaverse: POAPs.
POAP stands for Proof of Attendance Protocol. It’s basically a type of NFT that proves you attended a certain event, whether in either real or digital space.
For example, you might attend a real-life music festival and get a POAP to commemorate the event by scanning a QR code beside the stage. Or you might do the same thing at a virtual concert held within the metaverse itself. It’s a super-cool souvenir with bragging rights built in. Some couples even offer POAPs as wedding souvenirs!
POAPs can be used for purposes beyond pure memorabilia. If you’re expected to attend a weekly meeting for work or an organization you’re part of, your POAP can be used to reliably record attendance. They can be offered as milestones in certain gaming scenarios. And in the metaverse, which aims to seamlessly connect real life with virtual reality, POAPs are a great way to commemorate the most important commodity of all: time spent.
Join Quontic in the metaverse today
You already know that Quontic’s committed to innovation. That’s why we’re the first-ever bank to offer a Bitcoin reward checking account1. (that means you can get cryptocurrency, as a reward for doing your banking with us.)
But we’re not stopping there. We’ve already opened a metaverse outpost, where you can learn more about our banking and lending products, score exclusive and valuable NFTs (including wearables!), and much more. Stay tuned for events to keep our members excited and engaged So stay tuned as we build and develop our metaverse outpost. And stop by!
1Bitcoin Reward Checking account is a non-interest bearing personal checking account, requires a minimum of $500.00 to open the account, and does not require a minimum daily balance to earn Bitcoin rewards. Qualifying Point of Sale (POS) Debit Card Transactions (“Eligible Debit Card Transactions”) shall receive Bitcoin Rewards at the U.S. dollar value of 1.50% on all Qualifying POS Debit Card Transactions that post and settle to the Bitcoin Rewards Checking Account. Fees and terms are subject to change. Additional terms and conditions may apply. No Bitcoin Rewards will be paid if the Qualifying POS Debit Card Transaction requirements are not met or if the requirements for establishing an account with NYDIG Execution LLC (“NYDIG Account”) are not met. The following are not Qualifying POS Debit Card Transactions and do not count toward earning Bitcoin Rewards: ATM-processed transactions; transfers between accounts; purchases made with debit cards not issued by the Bank; cash over portions of POS transactions; Peer-to-Peer (P2P) payments (such as Apple Pay Cash); loan payments or account funding made with your debit card and purchases made using third-party payment accounts (services such as Venmo®️ and PayPal™️, who also provide P2P payments). Transactions may take one or more business days from the date the transaction was made to post and settle to an account. Bitcoin earned through this program can only be sold and redeemed for cash and cannot be transferred or spent, including in the metaverse. Bitcoin execution and custody services in connection with the Bitcoin Rewards Checking accountare provided by NYDIG Execution LLC (“NYDIG”). NYDIG is authorized by the New York State Department of Financial Services to engage in virtual currency business activity. To receive bitcoin services an account will be opened with NYDIG in which your bitcoin will be held (the “NYDIG Account”). Please refer to NYDIG’s User Agreement for more information, including applicable eligibility criteria. Bitcoin balances in your NYDIG Account are not insured by the Federal Deposit Insurance Corporation (FDIC), the Securities Investor Protection Corporation (SIPC), or any other public or private insurer. NYDIG does not make any recommendations regarding buying or selling bitcoin. There are risks associated with bitcoin trading, including possible loss of value. See NYDIG’s User Agreement. Individual transactions in the rewards program are not recorded on the blockchain. Information is published as of July 27, 2022.