Technology

How Web3 and the Metaverse Fit Together

Saro McKenna

Saro McKenna, co-founder & CEO of Dacoco, publisher of Alien Worlds (one of the largest blockchain games in the world), talks about how Web3 and the metaverse are changing the gaming industry, along with the trends shaping the Web3 gaming space.

Saro McKenna, co-founder & CEO of Dacoco, publisher of Alien Worlds (one of the largest blockchain games in the world), talks about how Web3 and the metaverse are changing the gaming industry, along with the trends shaping the Web3 gaming space. McKenna also shares how the pandemic is the driving force behind the rise of metaverse. 
 
How do you define the metaverse?
 
The metaverse is a peer-to-peer digital space where users are co-owners through the tokens of the metaverse. The metaverse allows people to bring new value, connections and opportunities into their real lives. The space is so versatile and can not only be used for gamification but for anything where interaction and community create value, such as networking, commerce, communications, the arts and education.
 
The metaverse makes possible a user experience with low or no barriers to interoperability between gaming, economies, digital assets, art and education. Its decentralized nature empowers users to not only create items of value within this new world but to also earn the rewards of their efforts and freely exchange their digital assets.

What does the metaverse mean for businesses? Why should businesses care about the metaverse?

For businesses, the metaverse opens up technological and economic opportunities in addition to opportunities to build and cultivate a community for its customers. The metaverse allows businesses to transform how they interact with their customers in every way imaginable. By expanding into the metaverse, businesses will be able to grow more lasting and pervasive relationships with customers built on shared ownership, shared incentive and shared experience.

What are some ways businesses can monetize the metaverse? 

Some forms of monetization can be tangentially related to games. For example, in the Alien Worlds metaverse, there are community members who have built businesses that allow them to monetize by creating gaming mechanics that work within the game. Businesses can also monetize by decentralizing power and conferring ownership to people within their communities or organizations and allowing the latter to create their sub-entities and businesses that ultimately bring more value to the greater business. At this stage in the evolution of the metaverse, there is a lot of discovery happening, with business models being developed, tested and iterated rapidly. 

Are there certain businesses or sectors that will benefit the most from the metaverse?

So far, blockchain games and their users have benefit the most within the metaverse, primarily due to the immersive gameplay features the metaverse brings to gaming communities. Alien Worlds has risen in popularity in just under two years due to its growing community of builders and gamers that have gravitated towards The community behind Alien Worlds gives groups of people from around the world a common goal or purpose the ability to better themselves economically and socially.  

What do you think is the driving force behind the rise of metaverse?
 
The pandemic intensified people’s need to connect on a global scale–even beyond social media. The metaverse was born to enhance digital connections in a meaningful way, and it only continues to grow. There is room for everyone in the metaverse, and people will always gravitate toward opportunities that will add real value to their lives. Previously, the rise of social media platforms such as Myspace, Facebook and Instagram mirrors many of the same aspects that the creation of the Metaverse was founded on. It has expanded the chance to collaborate, network and connect all while using the technologies that we’ve grown accustomed to. 

 
How do Web3 and the Metaverse fit together?
 
Web3 describes the era of the internet in which users are co-owners of platforms through tokenization. This contrasts with Web2, or the era of the internet characterized by content sharing by users - but not co-ownership by users. The metaverse and Web3 both rely on decentralized networks, since these confer co-ownership to all participants, which is a pre-condition to the shared digital space that is the metaverse. 
 
How are Web3 and the Metaverse changing the gaming industry? 
 
Web3 has opened the possibilities of gaming beyond what we imagined through Web2, or the current iteration of the internet. It has enabled the development of play-to-earn games, through which players can earn tokens as they play, which translates into real-world value and utility. So, while a gamer playing Mario Kart for 10 years will have nothing to show for it, a player on a game like Alien Worlds can earn digital assets with real monetary value. This then creates highly motivated and incentivized communities who create new content, technology and community events in order to enrich their position in the metaverse.
 
Additionally, within the Web3 system, players become co-owners of the systems they participate in. Because they are rewarded for their contributions, they have greater incentives to further the game’s development, such as by opening businesses within the metaverse the game is housed in.
 
The metaverse also enables players to trade in- and inter-game assets, opening a realm of possibilities for gamers to play different games and earn. In the future, a gamer will be able to trade an NFT earned playing Alien Worlds for an NFT earned from another game, allowing them to use NFT across different games, and participate in them more fully. This completely changes the gaming experience from the players’ perspective.
 
What are some trends shaping the Web3 gaming space? And what is the outlook for the space? 
 
Without a doubt, NFTS have shaped the Web3 gaming space to be what it is today. The exciting part about using NFTs in the blockchain gaming space is being able to actually use the NFT beyond artwork and collectibles. In fact, this concept is one of the core inspirations we had behind Alien Worlds. In our game, players are able to compete for resources, such as tools, weapons, artifacts and more. Instead of just visualizing the NFTs behind these, they come to life. 
 
I believe that DAOs (Decentralized Autonomous Organizations) will be the next biggest trend in the space. A DAO is an organization that is governed by all of the people who are a part of it (ex: members of an organization, employees in a company, etc). Those people vote on decisions that impact the organization, such as how the finances are spent. 
 
Alien Worlds is one of the only Web3 games in which DAOs (teams) are game components, and we are paving the way for other blockchain games to mimic our protocol. DAOs are revolutionary as they allow much more freedom to users, who ultimately are the ones governing the space and having rules implemented by a smart contract, rather than a single authority taking control and setting the rules. In a DAO, everyone holding the token is a co-owner and has a say in the strategic direction of the organization. 
 
Gaming is an excellent tool to educate people on the concept of DAOs. Because of the immersive nature of gaming, people are forced to understand the worlds they are playing in – the rules, the functionality, and the organization of the entire system. If the DAO is the structure that the world within the game relies on, then gamers must and will learn how they function, demonstrating their practicality within gaming. Once people understand DAOs and their benefits, they will begin to apply them outside of gaming for things like businesses, sports team ownership, and more.

What are some of the major news headlines you are following?

Currently, we are following conversations on the open metaverse vs closed metaverse As well as the regulation and compliances of the metaverse. It is fascinating to see how potential governance of something designed to be ungovernable will play out. 

This interview originally appeared in our TradeTalks newsletter. Sign up here to access exclusive market analysis by a new industry expert each week. We also spotlight must-see TradeTalks videos from the past week.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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