Metaverse is coming: With increased significance of VR, crypto and AI, the future is here

Existing in this alternate reality is akin to living inside the internet. It opens the door to a new world of entertainment and economy, and throws up challenges for mankind.

Published: 28th November 2021 05:00 AM  |   Last Updated: 27th November 2021 07:47 PM   |  A+A-

For representational purposes

Recently there has been a lot of discussion around singularity and whether we soon will be entering a phase where artificial general intelligence will become reality. However, before we delve deep into the philosophical and ethical implications of singularity, we have to understand what it really is, its actual limitations and why it may happen in a way that is different than anticipated.

Singularity is the notion that the exponential acceleration of technological development will lead to a situation where artificial intelligence supersedes human intelligence and will eventually escape our control. Some even predict catastrophic consequences for humanity where machines will become the dominant species on this planet.

This may seem a bit far-fetched, at least for the near future, given that advancements in hardware development and robotics are not catching up with software when it comes to artificial general intelligence. However, one can argue that the recent hype and developments surrounding the metaverse will definitely open the door to the rethink of Singularity. But what is the metaverse, and why is it such a big deal?

The next internet

Recent market analysis has estimated that the metaverse market opportunity could be around $800 billion by 2024. This could be seen as an expected meteoric rise for the metaverse, given such an estimated market size; however, the question that many people are asking is, what is the metaverse?

Presently, there isn’t a single definition; if you think about today’s internet as a virtual two-dimensional (2D) space where you can produce and share content, create value and connect with anyone anywhere, then the metaverse may be thought of as a virtual three-dimensional (3D) space where you can do everything that you can do in today's internet while being fully immersed—through virtual reality (VR)/ augmented reality (AR)—in that space exactly as you would be in the real world, but in a virtual realistic graphics-driven manner while being able to interact, connect, transact and create with others.
Simply put, existing in the metaverse is the equivalent of living inside the internet. This opens the possibility of the creation of a new world, a new economy and new possibilities.

VR immersion opens the possibility of the creation of a new world
(Image for representational purposes)

However, unlike the internet, the VR immersion would trick the human brain into releasing the same chemicals (endorphins, serotonin, dopamine) the same way as you would in the real world, which will make it more natural and more realistic for humans to inhabit than the internet. It’s a virtual environment where you can interact with people in a digital space. It is going inside the internet instead of just looking at it!

Today, some may think that VR is for video gamers; but historically, games have always preceded mainstream adoption. Space Invaders and Super Mario were played way before we started using Google. The same applies to VR: it is simply a gateway into the metaverse.

The term decoded

The next phase of the internet is approaching fast, which is taking cyberspace by storm. The metaverse, simply put, is the tech world’s parallel to the real world.

Oxford dictionaries define it as a virtual-reality space in which users can interact with a computer-generated environment and other users.

Metaverse, a portmanteau of meta (meaning transcendent), and verse (from universe), will allow a greater overlap of our physical and digital spaces.

In these alternate digital realities, people can work, play, and socialise. Imagine, instead of attending a music concert physically, your digital avatar checks into it and derives all the joys associated with the event. Till now, mostly restricted to the gaming world, in the metaverse of the future, people will lead their lives just as in the real world. You will be able to teleport yourself  for a vacation or a work meeting without moving in reality.

The access points besides devices would involve augmented reality (AR) and virtual reality (VR) technologies. AR, which can be accessed using a smartphone or computer, involves overlaying visual elements, sound, and other sensory stimuli onto a real-world setting to enhance the user experience.

Though still at least a decade or two away, in the metaverse you will eat, shop, and work and a new class of economy will surface which has already taken shape in the form of cryptocurrencies 
and NFTs (non-fungible tokens)

Recent market analysis has estimated that the metaverse market opportunity could be around $800 billion by 2024. This could be seen as an expected meteoric rise for the metaverse, given such an estimated market size.

What makes the Metaverse unique?

To elaborate on this point more, if we think about it, we have had mainframe computers that evolved to personal computers, which then evolved to mobile devices. In the case of the metaverse however, the leap or the iteration does not necessarily go to a faster device. Instead, to virtual simulations of virtual worlds and virtual environments where through VR and AR, we can finally make it possible to buy things in the real world through these environments. But, in particular, also to buy things that just happen to exist in these virtual environments. Connecting computers to the internet has catapulted them to mainstream use and marked the beginning of the dot-com era, and the last 15 years were clearly shaped by the mobile phone, which led to full mass adoption.

This makes the metaverse a very practical concept. It’s not just VR concerts, 3D gatherings or digital assets, the metaverse is an idea that brings these concepts together and tries to explain how they are all connected. Matthew Ball, an outspoken proponent of the metaverse, has outlined a few key ideas that show what this evolved form of the internet will look like. He identified that the metaverse is permanent, which means it will never reset, pause or exit. He also identified that the metaverse will be live (in real-time) as much of the internet today is designed for asynchronous use (think YouTube videos). There will also be no limit on concurrent users: this is one of the most difficult problems from a technical point of view (think Zoom calls). Because of the massive parallelism, the metaverse experience will be very different from the internet today.

However, the most important observation is that the metaverse will have a fully functional economy. The internet is fast becoming the best place to make money; almost every business has gone online, but the digital economy still has a long way to go. Most transactions are still fragmented, especially in virtual spaces and investments in digital goods are still in their infancy. Furthermore, due to the potential for interoperability between different providers, user-generated content will play a huge role in the metaverse.

The creation of a new economy

One of the most important elements is the payments infrastructure, which will undoubtedly be one of the cornerstones of the metaverse. The ability to buy, sell and most importantly, own things in the metaverse could be the most transformative part of this new era. This will lead to a situation where decentralised ledger technologies or blockchains will actually be the most practical, if not ultimate, solution for value exchange and for storing value. The opportunities for economic growth will be unfathomable, as this is literally creating a new world where users will interact, transact, own, exchange and share economic value.

This opens a whole new door for cryptocurrencies that policymakers are still struggling to regulate in the real world; how then can they be well-regulated in a metaverse? Covid-19 has highlighted the fact that we have already migrated our life to the digital world: we work, transact business and communicate online. The next frontier will be to exist inside this digital world that has taken shape around us.

Cryptocurrencies the world over have taken a giant leap since Zuckerberg renamed his company Meta. (Image for representational purposes)

Crypto in the Metaverse

When Facebook CEO Mark Zuckerberg announced that the company has remodelled itself as Meta, cryptocurrencies took a giant leap. Digital currencies will hold a significant place in the metaverse, as the two share a common operating principle—decentralisation of fiscal ownership, making verifiable and immutable ownership of virtual assets convenient.

Your digital avatar may need some fancy clothes to attend the digital concert. So what kind of monetary transactions will happen in the virtual world? A virtual economy will need currency, and cryptocurrency is your answer to it.

Blockchains and cryptocurrencies will become an integral part of the metaverse. A blockchain will allow transactions to be cryptographically secured.

The interest in digital properties has spiked with NFTs which are essentially unique digital items—pieces of art or in-game items, etc—where the ownership and other information are coded into the token. Currently, gamers can create their own virtual casinos and monetise them using cryptocurrencies.

In the metaverse, NFTs will give people ownership of their characters, in-game purchases and even registering virtual lands in their names. Cryptocurrencies will become the legal tender in the virtual economy and all intangible items will be NFTs.

The ease of operation it brings about—powered by advancing technology and the need for transparency—makes crypto a necessity. This will inspire confidence in people to make more and better investments and trade. This will be achieved by integrating crypto with VR/AR technology. It may just become the only tender for use in the metaverse aided through NFTs.

Gaming’s new universe

The gaming industry is moving ahead at full steam within the metaverse frontier. It makes way for an evolved gaming experience that is far more immersive, renders engagement and interaction seamless, and lets people manipulate their virtual environment in a life-like way.

There is greater participation with simple games being reintroduced by creators. This is being done through sophisticated digital avatars and holograms. 

Gaming within the metaverse is aimed at building connections. It fosters the need for active communities.

By using virtual reality and augmented reality technologies, one feels fully immersed in the digital environment

Musical concerts are being held in the games to draw in the audience and not to mention, tonnes of 
revenue. Blockchain technology allows for virtual trade, one of its biggest assets being digital games

Gamers have become active stakeholders by creating games. There are also the ‘live service games’ with lots of new updates and downloadable content.

Evolving technology such as 5G will further provide the speed needed for this digital transformation 
to evolve

Will AI dominate the Metaverse?

As mentioned at the start of this article, it may still be hard to create human-looking Android machines that will take over the real world. However, in a world where everything is digital, it will not be difficult to create intelligent self-replicating agents that can send and learn from their environment, and evolve to take over its environment. The metaverse will provide just that.

Decades ago, the Godfather of AI Marvin Minsky introduced the concept of the society of mind, where our cognitive processes and cognitive architecture are not confined to one particular place and are not isolated processes; it is the collective behaviours of many subtly ingrained concepts that our minds are capable of. Obviously intelligence, when polluted with negative traits like greed, avarice and vindictiveness, can become a curse to mankind.

While this is not a new concept in the domain of AI, it assumes great significance, given that our brains are massively complex networks of hundreds of billions of neurons that are in constant communication with each other. It is what helps humans to understand what is going on. Neurons start triggering and responding to a multitude of fast-paced reactions, setting up patterns within the brain that subsequently decide the course of actions to be performed by our mind and body in perfect unison. Historically, AI experts have tried to replicate this process using artificial neural networks (ANNs), but this was mere software-based trickery to simulate the human brain.

This is now changing rapidly as the hardware design is starting to transition, with the advancement of Neuromorphic computing in which traditional semiconductor architectures are being disrupted and re-engineered to mimic the structure of the human brain, where processing and memory are being combined in one unit, the neural structure that Marvin Minsky created and many other structures are slowly becoming a reality from a hardware standpoint. This in turn is already making AI faster, better and more general. This is incredibly exciting because if used properly, it will produce applications that are incredibly intelligent and may eventually supersede human level general intelligence. 

This is particularly relevant for the metaverse, which will not only be a place where avatar-wearing humans are interacting with other avatar-wearing humans in a virtual 3D space, but will potentially be the first place and chance where artificially intelligent agents can finally exhibit a quasi-human behaviour, without the physical limitations of building an actual humanoid robot in the real world. With the advancements in AI, and specifically Neuromorphic computing, which is accelerating the approach of artificial general intelligence (AGI), we may witness a metaverse where an AI is indistinguishable from a human!

The writer is a serial tech entrepreneur, investor and academic.

(The article was first published on


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