Blockchain analytics firm IntoTheBlock has done a deep dive into where the metaverse may be headed.
With social media giant Facebook rebranding itself to “Meta,” the narrative surrounding the emergence of the metaverse – and what that means for crypto – has intensified. Facebook’s revamp preceded huge rallies in multiple metaverse-related tokens like Decentralnd (MANA), The Sandbox (SAND), and Starlink (STARL).
IntoTheBlock notes that while Facebook is correct in tapping into an important long-term trend, the tech giant’s ambitions aren’t exactly in line with the vision of a metaverse controlled by decentralized communities.
“Though certainly ambitious, Facebook’s plans is subject to some of the inherent limitations of the web 2.0 model. Overall, this is expected to result in an opaque and less secure network where value created does not accrue to its users as would be the case in a decentralized platform like Ethereum.”
The firm warns that all users on Facebook’s metaverse will be required to sign in with their personal information which will be visible to the company on all of the other platforms it owns. Companies who want to build on top of Facebook’s metaverse will ultimately risk competing against the firm when they launch their applications.
On the other hand, the insights firm says that blockchain and Web 3.0 can solve these issues by making “platform users, builders and owners ” equal to each other on the same decentralized web.
“Tokens can serve as incentive mechanisms to attract users and builders and can then be used to vote on decisions about the metaverse. While this does not guarantee everyone will be happy with results, it does allow participants to have an impact on where the platform is going.
Users and builders don’t have to trust an entity to act on their best interests. Through the blockchain people can openly validate activity taking place and if they don’t like what is going on they could simply fork the network.”
IntoTheBlock also names security as another weak point in a centralized metaverse, using Facebook’s recent outage as a prime example of this vulnerability. On a blockchain, the network is secured by the nodes all working with each other, and in the case of Ethereum, over $33 billion has been staked. In order to influence consensus, the firm notes that someone would need at least a third of everything at stake before attempting to attack the network.
The research firm says that overall, “there’s a stark difference between what a web 2 and web 3 metaverse could look like,” adding that while we are still very early in the development process, “a crypto metaverse promises a more inclusive aligned and secure network.”
Read the full report here.