Meta: Following Diem’s somewhat dramatic downfall, continue reading to find out whether Ethereum is the only cryptocurrency that is appropriate for the metaverse.
If you like to keep up to date with the latest and greatest digital trends to explode into the mainstream, you may be familiar with the metaverse and its slow but steady journey to global adoption. It may not necessarily have peaked as of yet but with its ongoing growth and development progressing at a seemingly rapid pace and social media platforms scrambling to get involved, a growing number of consumers are already wondering which cryptocurrencies will reign supreme within the virtual universe. To determine whether Ethereum is the only cryptocurrency appropriate for the metaverse with Diem’s future now well and truly hanging in the balance, continue reading.
The downfall of Diem
In January 2022, it was announced that Diem, a stablecoin proposed and backed by Facebook, would be ceasing operations after its assets were sold to Silvergate Capital for a reported $200 million. It came after the digital currency, which was in the process of launching in the United States, encountered problem after problem in securing mainstream adoption in the years since it was first announced to the public back in 2017. It may not necessarily signal the end of the stablecoin for good but with Facebook continuing to bolster its additional ventures, the vast majority of which are centred on the upcoming metaverse, its welcome return is proving somewhat less likely over time. It was, for example, initially predicted to play a fundamental role in the ongoing growth and development of the metaverse and especially after its launch with Facebook’s long-standing involvement in the metaverse previously improving Diem’s chances of becoming the virtual universe’s sole cryptocurrency.
An unpopular choice
With Diem now out of the race to become the metaverse’s reigning cryptocurrency, the focus has been shifted to Ethereum which, behind Bitcoin, has climbed the ranks to become one of the most popular and successful digital tokens to emerge in the history of the ongoing cryptocurrency boom that started in 2009. It has, however, attracted criticism in recent months with experienced cryptocurrency investors, in particular, pointing to its inability to facilitate blockchain games which are predicted to comprise a substantial portion of the metaverse. It may remain a popular choice when it comes to decentralised finance and NFTs but this, if anything, only proves that whilst a certain digital currency may be suitable for a specific purpose, its functions are not necessarily applicable across the entire range of cryptocurrency applications.If metaverse users are to buy Ethereum, for example, they are more likely to do so outside of the virtual universe and for investment or trading purposes only.
The rise of the underdogs
It can be easy to assume that a well-known cryptocurrency, such as Diem or Ethereum, will reign supreme in the metaverse but with a number of brand-new virtual currencies that have been specifically designed for the metaverse cropping up, the answer to the now age-old question of which cryptocurrency will dominate the metaverse may lie somewhere a little less familiar. In the past couple of years, for example, the rise of several lesser-known cryptocurrencies, such as Sandbox, Floki Inu, Star Atlas, and Epik Prime, has steadily climbed the ranks and now teeter on the edge of victory. It may also benefit you to know that whilst the metaverse sits firmly in its embryonic stage, the cost of investing in digital currencies that are performing well in the metaverse is likely to remain relatively low. This opens the door for greater investment opportunities for both inexperienced and experienced cryptocurrency investors to back promising cryptocurrencies before they have even had the opportunity to explode into the mainstream and, perhaps most importantly, into the metaverse.
The importance of cryptocurrency in the metaverse
It may have stolen countless headlines throughout the past year but due to its reliance on industry jargon and terminology, the role of cryptocurrency in the metaverse remains relatively unclear for the vast majority of consumers. It may, however, benefit you to know that transactions completed in the metaverse will be permanently yet anonymously recorded through blockchain technology on a decentralised ledger. It can also be programmable through what is known as a smart contract which is, essentially, blockchain-based software routines that are immediately and automatically run when a set of predetermined conditions are met. This can then be used in the metaverse to establish ownership of a particular item in the form of a cryptocurrency asset, such as a work of art or piece of music, with you becoming the sole owner regardless of whether another user may decide to save a copy to their computer. In addition, a number of virtual items can also be purchased by your virtual avatar in the metaverse so long as a cryptocurrency wallet is present including music, movies, games, and apps.
If you are interested in which cryptocurrency will be deemed appropriate for the metaverse, it may be worth analysing the downfall of Facebook-backed stablecoin Diem, Ethereum’s role as an increasingly unpopular choice, the rise of a number of underdogs including Sandbox, Floki Inu, Star Atlas, and Epik Prime, and, last but not least, the importance of cryptocurrency in the metaverse ahead of its impending launch.