JPMorgan Chase Research (Part 2): What will the Metaverse bring us? What key aspects should be built in?

From DeFi to DAO

Over time, virtual real estate markets may start to see services that resemble real-world offerings, including credit, mortgages, and lease agreements. However, with the advent of decentralized finance (DeFi) and the composability of digital assets based on blockchain tokens, the next generation of financing firms may use digital clothing as collateral to underwrite virtual land and property mortgages. In fact, it may not be a company at all, but a self-organizing, task-based community, also known as a Decentralized Autonomous Organization (DAO). The DAO may have embedded its original balance sheet into a multi-signature wallet to create collateralized loans.

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Token market cap of major Metaverse platform soars after Facebook rebrands as Meta

Work in a virtual world

Supply and demand dynamics are driving more people into the meta-economy. This, in turn, will require developing new skills and creating new money-making opportunities. After all, people will have to develop and manufacture products that are consumed in virtual worlds — creating huge opportunities for the creator economy. RTFKT is a virtual sneaker brand that was recently acquired by Nike. It builds an interesting bridge between digital and physical goods (NFT owners receive physical sneakers that match their NFTs), and in addition to wearables, it is building a network of avatars, spaces and digital An ecosystem of products. RTFKT sneakers sold for as much as $10,000 a pair at a recent auction. By contrast, some people serve in the Metaverse. For example, if you’re planning a virtual party and want music, you can hire a singer or DJ to perform. Virtual concerts have the potential to be more lucrative than brick-and-mortar concerts, which have barriers such as capacity and parking. Recently, a massive virtual concert in Fortnite drew 45 million viewers and grossed about $20 million at the box office, including merchandise sales. People who would not otherwise have access to such experiences can now participate due to geographic or cost reasons.

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We’ll wait and see how well the marketing and advertising work. With a large audience, there is a huge opportunity for branding and immersive advertising experiences in the Metaverse. As with contemporary social media companies, advertising is a model used by many platforms to generate revenue. In-game ad spend will reach $18.41 billion by 2027.

Numerous opportunities across industries and countries

The Metaverse will present a huge opportunity for businesses, such as a manufacturer that is buying new parts for its equipment. Currently, the process involves receiving a physical brochure or emailing a PDF with a static 2D image. In Metaverse, users can test products in a virtual environment at a lower cost.

One of the great possibilities of the Metaverse is that it will expand access to markets for consumers in emerging and frontier economies. The internet has unlocked access to goods and services that were previously out of reach. Now, workers in low-income countries may be able to find jobs in Western companies without immigration. Educational opportunities will also expand, with the virtual reality world becoming a low-cost and effective way to train. With these developments, there must also be clear governance.

From a business perspective, there is an opportunity for massive expansion. Instead of opening stores in every city, a major retailer might build a global hub in the Metaverse that can serve millions of customers. Beyond retailers, the Metaverse will accelerate the transition from cash to cryptocurrencies in gaming and sports betting.

Companies such as Sightline Payments have built the infrastructure to support cashless digital gaming, and as these industries rapidly transform to serve gamers in the Metaverse, these companies can capitalize on this opportunity.

Hype vs reality

While the future of the Metaverse is exciting, in order to realize its full potential for engagement, community building, expressiveness, and commerce, further development of key areas is required. We see these as new opportunities for teams, projects, DAOs, enterprises, technology providers and financial institutions to thrive and collaborate together in a vibrant ecosystem across the following areas: technology, business infrastructure, privacy and identity, future workforce , regulation, taxation, accounting and social infrastructure.


From a technology standpoint, some of the key requirements for the development of the Metaverse are:

Improved performance for avatar movement and environment rendering

Reduce environmental “sharding” so that all participants can interact in the same place

Greater capacity to support design and interaction complexity

Reduce local hardware requirements for complex interactions with 3D rendering

Extend accessibility across devices, including mobile

Develop interoperability or interactions across virtual worlds, and ways to manage engagement and digital assets across these platforms

Define standards for digital assets (wearables, items, brands) and virtual/cryptocurrency so that they can be transferred across different virtual worlds

Advanced discovery mechanics such as finding friends or recommending things to do, places to visit and the ability to customize virtual goods

Data analysis and reporting for extended virtual spaces. These will be dedicated to commercial and marketing purposes and will track business key performance indicators

business infrastructure

Some key elements to support business and the meta-economy still need to be identified and adjusted, including:

Integration of Web 3.0 virtual worlds with traditional traditional financial payment rails (e.g. credit cards, bank payments, debit cards, wire transfers)

Integration of Web 2.0 Virtual World with Crypto Payments and NFT/Digital Asset Market Commerce

Single wallet user experience, including:

  • Web 2.0 traditional financial payment rails, virtual currencies and virtual assets
  • Web 3.0 Crypto, NFTs and Digital Assets
  • Digital Identity Verifiable Credentials, Know Your Customer (KYC)/Anti-Money Laundering (AML) Compliance Keys and Reputation Points
  • Multiple aliases to protect privacy and achieve digital freedom

Improve virtual/cryptocurrency and digital asset-backed financing and staking by using lending models or leveraging decentralized finance (e.g., NFT collateral-backed virtual world mortgages)

Creating cross-border and cross-Metaverse foreign exchange and liquidity solutions

Improve user experience for mainstream adoption of non-encrypted/Web 3.0 native products

Extend solutions and services to support DAO community-based projects, commercial ventures and investments

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Privacy and Identity

User identification and privacy protection are critical to both interactions and transactions in the Metaverse.

  • Preserves the ability for a person to have multiple avatars/identities and adds:

Private KYC/AML Compliant Commerce and Payments

Verifiable credentials that can be easily built to more easily identify community/team members, or enable configurable access to different virtual world locations and experiences

Prevent cyberbullying or online harassment/attack across virtual worlds

  • Expand the NFT token-gated space, including the creation of private interactions, discussions and messaging

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future workforce

What will the future of work in the Metaverse look like? Some key areas to consider include:

  • Train new designers and developers specializing in 3D modeling of avatars, wearables, objects, architecture, and interiors with virtual world-specific software development kits (SDKs)
  • Content creators can span virtual worlds, virtual goods, NFTs, commerce and communities
  • Redeploy event producers specializing in Metaverse experiences (concerts, parties, art exhibits, community meetings, sporting events, sightseeing and travel)
  • Create a community manager focused on building strong online and offline relationship building and engagement to strengthen platform engagement and stickiness

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Regulation, Taxation, Accounting and Social Infrastructure

When it comes to the regulatory framework governing the Metaverse, there are many unanswered questions that need to be addressed, including:

  • Paving the way for the regulatory, tax and accounting treatment of Web 3.0 digital real estate/property and virtual text business transactions
  • Proficiency in the regulatory, tax and accounting treatment of a Web 2.0 virtual world primarily using Web 3.0 digital assets
  • Solutions and services that support a globally accessible virtual world, but may be subject to local commercial and payment jurisdictional requirements and rules
  • Evolution of community governance (eg, who sets the rules in the virtual world? Who governs?)

What is your “Metaverse strategy”?

In the Metaverse, some of the existing services and business models we are familiar with will continue to exist, but the Metaverse opens up a whole new way of engaging that we expect will lead to unique new services and business models.Not everything in the Metaverse is relevant to every business. But there’s no harm in taking the opportunity to explore.


There are many different interpretations of the Metaverse, and there are different perspectives to understand beyond what’s covered here.


While the Metaverse will span many industry verticals, evaluate your business for relevant opportunities.


Gain experience through internal development. Take this opportunity to explore creative consumer engagement through new channels, services, experiences, digital goods and assets. Start small, move fast, test and learn.


Start building a network of participants in the Metaverse ecosystem. The world is still small, so high-quality collaborations and partnerships are still available at a reasonable level of investment. Connect with a new generation and tap into an alternative talent pool.


Get your business out there and position yourself to attract the tech-forward community.

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Our attitude towards the Metaverse

The success of building and scaling in the Metaverse depends on having a robust and flexible financial ecosystem that will allow users to seamlessly connect between the real and virtual worlds. Our approach to payments and financial infrastructure will enable this interoperability to be enhanced.

We believe that existing virtual gaming environments (each with its own population, GDP, in-game currency, and digital assets) have similar elements to existing global economies. This is where our long-standing core competencies in cross-border payments, foreign exchange, financial asset creation, trading and custody, and our massive consumer foothold, can play an important role in the Metaverse.

We are building and scaling emerging technologies to modernize infrastructure and business models, including but not limited to tokenization and digital identity, as we seek to continuously innovate and better organize financial transactions and payments in a decentralized network.

Posted by:CoinYuppie,Reprinted with attribution to:
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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