Blockchain enables enterprise business models in the Metaverse
Here’s how blockchain is being utilised in the Metaverse to establish business models that are both efficient and cross-compatible with the actual world.
Since its start in 2017, enterprise blockchain has gone a long way. Initially, blockchain for business was a system based on private, permissioned networks and was largely utilised for the supply chain management. Enterprises began to use public, permissionless networks like Ethereum to do business as blockchain evolved.
In the year 2021, businesses in the Metaverse are implementing decentralised notions to develop more efficient procedures. While the Metaverse is difficult to describe, William Herkelrath, head of business development at Chainlink Labs, a decentralised oracle network, told Cointelegraph that he believes it is a collection of ecosystems that are organically arising out of decentralised finance or DeFi:
“Enterprises will be required to establish ecosystems in the Metaverse because they must interact with the outside world.” Consumers, for example, want to utilise loyalty programmes outside of single platforms, so they’ll choose businesses that offer incentives that can be used across many ecosystems. Data, physical assets, commercial, and financial assets may all be built up in a layer outside of a centralised system in the Metaverse.”
The Metaverse for enterprises
While the notion may appear futuristic, a growing number of blockchain-based businesses are beginning to embrace the Metaverse. During a panel titled “Building the Enterprise Multiverse” at the European Blockchain Convention’s virtual conference last Wednesday, this issue was examined in depth.
During the conversation, David Palmer, the blockchain lead at Vodafone Business, stated that the Metaverse is much more than a virtual environment where digital experiences may be had through games or social media networks. Palmer claims that the Metaverse is currently being used to apply blockchain technology to financial ideas such as central bank digital currencies, nonfungible tokens, or NFTs, and DeFi.
However, Palmer pointed out that the Metaverse is missing a layer that allows virtual transactions to be transferred to the actual world. A cell phone, according to Palmer, can operate as a middleman between these two worlds. Vodafone Business is using blockchain to establish digital identities that can be used in both the Metaverse and real life, he said :
“Digital identification will bridge the gap between the digital and physical worlds.” A digital wallet, for example, will have a bank account, mortgage information, tokens, and NFTs, among other things. A decentralised identity, on the other hand, will have access to those credentials, allowing people to engage in both the Metaverse and the real world.”
Palmer said that Vodafone Business is working on developing virtual identity wallets for mobile devices. In recent research titled “The Metaverse, Web 3.0 Virtual Cloud Economies,” Greyscale Research discussed the concept of self-sovereign identity in a multiverse. Self-sovereign identification is described as an “internet-native social reputation coin (creator coins)” in the study, which also mentions that data from other platforms may be imported into the Metaverse and utilised for identity or credit score.
During the discussion, Angel Garcia, Telefonica’s head of global supply chain strategy and transformation, described how a digital supply chain for the Metaverse may help telecoms become more efficient. Telefonica, according to Garcia, has created a blockchain network that will be utilised within the Metaverse ecosystem. He went on to say that the organisation is actively gathering data in order to optimise end-to-end operations. “The next stage is to automate those business processes.”
Businesses can have a digital twin of their autonomous organisation to govern, operate, and control analogue processes, according to Rowan Fenn, co-founder of rising X, an enterprise solution for companies looking to build digital autonomous organisations: “These organisations will be able to interact and transact with each other in real-time in a Multiverse.” In an analogue environment, this will also allow the digital autonomous groups to collaborate.”
Companies having a digital twin in a Multiverse ecosystem, according to Fenn, will be able to generate more goods and services while using fewer resources. As a result, he believes that by using this business model, the world will be able to transition from a finite to an unlimited economy.
Enterprises already use blockchain to operate in the Metaverse
While businesses are currently researching early use cases for implementing business models in the Metaverse, certain industries are already doing so. The use of blockchain networks in the insurance sector, for example, illustrates a Metaverse business model, according to Herkelrath.
Hundreds of thousands of insurance contracts are being sold to farmers throughout the world through virtual ecosystems, according to Herkelrath. He went on to say that smart contracts built on top of blockchain networks, as well as decentralised oracles like Chainlink, have made it feasible to overcome the insurance industry’s transparency issues. Furthermore, the whole insurance procedure has been simplified to make it internationally available to alienated clients.
Although it may appear that blockchain alone has allowed this, Herkelrath points out that smart contracts created by insurance companies require data that couldn’t be acquired without the Metaverse:
“You have a metaverse of firms with data flowing in that is confirmed by a larger network, which makes this viable.” The fact that this can happen in the Metaverse shows that business-to-consumer transactions may become affordable and available to everyone everywhere.”
How likely are enterprises to embrace the Metaverse?
While some businesses are beginning to design and use Metaverse business models, a lack of knowledge of the technology may slow adoption. During the panel discussion, Rodolfo Quijano, the head of the blockchain at Henkel, a German chemical and consumer products firm, stated that the main problem driving adoption currently is recognising the value that the Metaverse can give to businesses:
“Technology isn’t an issue; nevertheless, people will need more time to understand what blockchain is and how it compares to traditional enterprise resource planning tools.” Finding champions for blockchain adoption in the Metaverse can be difficult.”
“The largest aspect to address for a teleco is how to link individuals in the Metaverse,” Palmer said, adding that scalability within a Metaverse corporate setting is also a concern, as is getting organisations to grasp how to migrate and participate with this new technology. People will have two identities, one virtual and one real, thus the concern is whether we will have enough communication capacity.”
Furthermore, Palmer believes that when it comes to Metaverse business models, firms would question the function of blockchain. He does, however, feel that technology is critical for these applications. “In a multiverse setting, blockchain is the trust and exchange layer. It’s a huge potential, but corporations will find it difficult to make the change.”