$10B Investment in Metaverse is not sufficient
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Yat Siu, Animoca Brands’ co-founder and executive chairman, has a lot to say about the metaverse. This is due to the fact that his business owns The Sandbox and has stakes in a wide range of web3 businesses, including OpenSea, Dapper Labs, and Axie Infinity. He expressed his opinions about Meta’s interpretation of the metaverse at TechCrunch Disrupt.
Animoca Brands is much bigger than The Sandbox. There are 380 companies in the group and portfolio. Thirty of them are subsidiaries. Animoca Brands is technically an Australian company with a headquarters in Hong Kong and nearly a thousand employees.
They claimed they would invest $10 billion annually to make the metaverse functional. Here’s the thing, however: in our opinion, Facebook will not be successful with just $10 billion. When you take fungible tokens into account, the amount of money exchanged in the open metaverse area is actually significantly higher. Why would I transact on something like Meta, despite its graphics, when I have to give the platform half of the value when the end user receives the majority of it?
I get 95% off everything if I use Sandbox, however. Economically, it just doesn’t make sense for me to do that. Therefore, Facebook would have to spend much more money to entice users to use its network.
What are Animoca and Sandbox?
A number of Hong Kong partners from the entertainment, finance, real estate, acting, film, music, and gaming industries have joined The Sandbox, a top decentralised gaming virtual world and subsidiary of Animoca Brands, to build Mega City, a new cultural centre.
A pioneer in digital entertainment, blockchain, and gamification who is seeking to improve digital property rights and support the creation of the open metaverse is Animoca Brands, a Deloitte Tech Fast winner and listed in the Financial Times list of High Growth Companies Asia-Pacific 2021. The REVV token and SAND token are only two of the many items the company creates and releases.
The Growth of Web3
The third generation of the Internet, often known as Web3, comprises a number of technologies that have advanced quickly in recent years. The ecosystem today includes tens of thousands of businesses and more than $80 billion in startup funding from investors including venture capitalists, hedge funds, private equity, and other investors. A number of significant businesses from many sectors, including JPMorgan, Nike, Google, and Disney, have started to consider how web3 will affect their operations and the potential advantages this new technology may provide.
Blockchains, smart contracts, and tokens are the fundamental building blocks of web 3. (fungible and non-fungible). Blockchains are publicly accessible, networked platforms for computation that are controlled by the community. With the development of Ethereum in 2014, blockchains were transformed into decentralised computing platforms that could run smart contracts when specific conditions were satisfied. Finally, tokens enable the digital representation of value, whether they are fungible—that is, native to the digital world—or non-fungible—that is, peculiar to a given asset.
The rate of innovation has kept accelerating, and businesses are developing customised solutions that hide wallet complexity while maintaining key advantages.
Here are three illustrations:
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Digital Assets and Goods
You could use a wallet to move different kinds of digital products between platforms, similar to the bank example. Whether storing digital artwork, next-generation loyalty tokens, or video game skins, wallets’ capacity to foster interoperability and enable user-free asset movement unlocks advantages that may put established business models and client stickiness in jeopardy.
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Credentials and Access
Wallets have the power to challenge various access and identity management systems. Other web3 businesses are putting more of an emphasis on content-related access, such as Mintgate. These sites offer gated access to forums or entertainment to owners of specific tokens (such as an NFT ticket) or loyalty points.
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Date and Content
Even if the process of creating material on the Internet today is decentralised, its distribution is frequently controlled on large platforms. In this scenario, social media networks would just read social graph data, allowing you to move your content and social interactions freely between platforms.
Conclusion: Implications today
Web3 can’t be disregarded any longer. Ecosystem health is good. It has significant money and established disruption aims. Although this debate of identities and wallets is particularly pertinent for specific tech platforms, it also illustrates the wider risk and potential that web3 poses when innovation questions accepted notions of who owns what and how to create defendable profit pools. All businesses need to be aware of potential future developments that could have an impact on their current core markets as well as those that could present opportunities.
