NFTs and Their Role in the “Metaverse”

Facebook recently announced that it was investing $10 billion in profits into development of the “Metaverse,” a new platform focused on augmented and virtual realities. While the features of this proposed “Metaverse” are unclear at this time, such a proposal envisions a world where the digital and physical world are closely integrated. And Facebook is not alone—many companies are increasingly moving towards augmented reality products.  

Non-Fungible Tokens (NFTs) will be critical to making the vision of integrating the digital and physical world by giving a unique identity to avatars or digital items. For instance, an avatar supported by NFT technology will not just be a generic compilation of face and clothes templates which can be copied by any other user selecting those templates. Instead, an NFT-supported avatar would be comprised of all the user’s prior digital interactions and experiences (effectively reflecting their digital “life”) and possessing all the digital items the user has accumulated (which would themselves be backed by NFTs). In effect, NFTs give users and items an “identity” within a virtual space that is completely independent from a developer’s control of the code. This article details further the role NFTs may play in the Metaverse.