Future to Come or Bubble to Pop - A Metaverse Debate

For the time being, the metaverse is the hot new toy that everyone wants to play with, but for how long? Is it long-term viable? Some refer to it as a "bubble" about to burst. Some refer to it as the "next best thing to teleportation".

Fazzaco has collected some views online, and arranged a debate as follows.

Argument: Is metaverse the future to come or a bubble to pop?

Affirmative: Metaverse is the future

Negative: Metaverse is a bubble

​First round, First Affirmative attacks, and First Negative defends.

First Affirmative: The fact that numerous financial institutions enter into metaverse proves a promising future. Money never lies

Conclusion first, metaverse will continue to be popular in 2022.

The metaverse market may reach $783.3 billion in 2024. Online video games and gaming hardware companies are expected to take up 400 billion, while the rest will go to livestreaming and social media companies.

Had this forecast become real, that indicates a compound annual growth rate of 13.1% from $478.7 billion in 2020.

Let's take a look at our technological history. The development of technology has already gradually shifted from space travelling to electronic communications in the last couple of decades, if you have noticed it. The massive market, take gaming as an example, represents where humans are heading. We had squandered lots of manpower and money on aerospace during the Cold War, and what we have gotten so far? We put some men on the moon, a destination to which is still challenging to go back, and sent a couple of probes to different planets, and that's it. I'm not saying what we have achieved is meaningless, but the universe is infinite and it goes beyond our imagination. Humans need tens of thousands of years to just burst out the Oort Cloud, the outskirts of our own Solar System. Consequently, we've shifted our focus. In metaverse, on the other hand, anything could be possible. With the right haptic equipment in place, unprecedented experience will be there. So, like we said, that's the future. In addition, there will be an independent economy in the metaverse, where there are humans, there is trading, so that's good news for the finance industry. The fact that numerous financial institutions enter into metaverse proves a promising future. Money never lies.

First Negative: Numbers never lie, instead of money. All recent data are pointing to a possible bubble to pop soon

What many of the financial institutions are doing now is simply putting some metaverse stocks together, or purchasing a virtual land lot. They are still exploring the technology and scenarios. But as the main part of the concept of metaverse, NFTs and blockchain are now on the verge of burst.

NFT, non-fungible token, came in to solve an issue concerning virtual artworks in the first place, the ownership. Because all you have to do is click, copy and paste to use an artwork online. But the ownership issue was solved thanks to NFT, and that led to a frenzy.

You just said that money never lies, well, I'm afraid only numbers never lie. Interest in both projects has drastically fallen since the end of January 2022, with all signs pointing to a crash. Monthly purchases of NFTs fell below 800,000 for the first time since January's peak. The average NFT pricing has dropped from $6,800 to $2,000 since January. Secondary sales (all subsequent resales of the work after the first purchase) fell to 7,900 per day in January, down from a high of 38,000 per day in January and an all-time high of 103,765 per day in September. The Google search index of the word metaverse shows similar patterns, which peaked during Facebook's rebranding last year, but now they are seeing decline on a daily basis. Isn't this obvious?

​Second round. Second Negative attacks, Second Affirmative defends.

Second Negative: Better than the reality? Save it

Even if the metaverse becomes real, I highly doubt that the masses will flock to it. Let me give you some examples, alright? Say, we are now in a metaverse, maybe you're in the mood to watch a movie in one of those virtual theaters, sounds good? But hey, we've already got VR movies now. Plus a virtual theater is far from providing us the same level of pixel level our real eyes can see, or the acoustic level our ears can hear.

So maybe a virtual exchange? Do you feel like it is a better way for everyone there to strap on a VR goggle than sitting in a real exchange or at home, looking at the screens of computers and cellphones? With screens you can at least see what is going on without any unnecessary gadget, better than looking at all those flying statistics around you.

Care for a date after work? I don't even have to get into this. Are you telling me someone will rather go out with his / her date online than actually holding hands, smelling his or her perfume and feeling the warmth of an actual hug?

Wanna have a jog? Look, I really don't get it if someone wants to do a jog in virtual forests instead of actually going out your home and enjoy a job in the real nature.

Second Affirmative: Is that so? That only means metaverse is not your thing

The founder of Ford once said, "if I asked someone what they prefer, a faster horse or a car, they'd say a faster horse". I guess that summarizes your point, and proves that you are still thinking inside the box.

Indeed, Mark Zuckerberg did describe some metaverse scenarios like having virtual meetings and workouts, and having a 2-pound goggle on you will make the experience inferior to reality. However, metaverse is not for the mirroring of reality in the first place. What metaverse aims to offer is something that people can hardly experience in real life.

Watching a movie? Why don't you join a movie in the metaverse and embark on a journey with the characters? Jogging in real forests? Not everyone lives right next to beautiful nature, more of us are perhaps bound to a home amid concrete jungle where you hardly see any sunshine. We might as well dive into metaverse and work out on the beach of an alien planet with gigantic planets rising and falling in the sky.

Third round. Third Affirmative concludes, followed by Third Negative

Third Affirmative:Metaverse will be a promising land full of new opportunities

Metaverse, once fully realized, will offer a complete social and economic system where experience is immersive. Unlike video games, the experience is non-stop, and highly interactive.

There are three main ways to make profits from the concept of metaverse for financial institutions, and they are investing, advertising, and offering services / products. For advertising, many financial brokers have been sponsoring sports clubs. Now, it is not a bad idea to work with, say gaming companies, and put your ads in games. For fintechs, like payment, software companies, they may consider supporting in-game trading systems (game currency exchange, account top-up; or offering a platform for a trading simulation game, turning players into potential clients).

It is even possible to expand your business by developing a financial exchange simulation game yourself (Forex Market Simulator, maybe?)

Third Negative: Opportunities aside, metaverse is also a "Wild West" where regulations are absent

You guys are discussing the metaverse as if it were already there, finished, completed. But wake up, it is still in our head. Now for something that does not exist yet, there are no laws to apply. Even if it becomes real, it'd be something like the Wild West for a long period of time. Do you really think you'll be one of the survivors in Mad Max? It'd be a haven for for tax evasion and money laundering and all sorts of financial crimes, let alone cybersecurity issues, before appropriate laws come into effect.

​When you invest in real-world real estate, for example, and the market collapses, your property is at least unaffected. It may be of lower worth, but it still exists. But it's possible that your metaverse real estate investment will completely vanish if it fails.