How The Metaverse Relies on The Data Economy

The Metaverse is a concept quickly coming into the reality of a shared virtual world accessible to anyone on the internet. Importantly there is only one Metaverse (hence proper noun), composed of many virtual worlds and digital domains like Sandbox, Decentraland, and CryptoVoxels. What ties all these independent worlds together is a "".

These are not siloed individual platforms. In the Metaverse you can easily move yourself or your items from one virtual world to another. You can't export all your posts from Facebook onto Twitter.

On the other hand you don't even have to "export" your avatar from Decentraland to Sandbox, if your avatar exists in one, it automatically exists in the other, all you need is an interface that can render your avatar and the virtual world you want to visit. A shared open state is what allows this seamless Metaverse experience to be possible. Having a single source of truth for all data and assets that exists outside of any individual platform is what gives the true value and exponential potential to the Metaverse concept.

How is this shared open state created and utilized though? The Data Economy.

What is the Data Economy?

The Data Economy is a digital ecosystem of data-based products and services. This ranges from data storage to compute resources and data marketplaces to autonomous agents for hire. In web2 they are generally represented by FAANG and the NASDAQ, in crypto they are represented by DATA, the leading decentralized ETF for investing in Data Economy tokens.

The Data Economy is the backbone of America's biggest companies and the same is true in the crypto market. Chainlink, IPFS, and The Graph are three of the biggest data-based services in the crypto economy that often sit in the top 10-50 tokens by marketcap because they are utilized by nearly every smart contract platform and dapp, including Sandbox. In fact, the crypto Data Economy has a bigger combined marketcap than all of DeFi.

https://twitter.com/thomas_hepner/status/1432796767326666755

Why is the Data Economy important for the Metaverse?

The meme says it all. Nearly every component of the Metaverse is built upon the Data Economy as a shared open state. These decentralized data protocols allow independent virtual worlds like Sandbox to network into an interconnected shared virtual reality called the Metaverse.

Without them, there is a lot less value to web3 tokenized virtual worlds than centralized web2 platforms with existing network effects like Facebook. Data-centric, chain-agnostic frameworks are what truly create the Metaverse and bring value to its experiences. They provide persistence, utility, and availability for all the dapps, games, and even the very fabric of reality that you interact with .

Metaverse Reality As Persistent Data

We mentioned the concept of 'shared open state" as one of the core principles of creating the Metaverse. This concept is powerful because you aren't tied to Ethereum or Solana or any particular chain. Your assets will always exist in a persistent storage layer even if the smart contract platform that it is tokenized on loses popularity or completely fails.

"IPFS is used to store the actual digital asset and ensure the asset cannot be changed without owner permission."

- Sandbox whitepaper

Yes, the token represents your ownership, but ownership of what? A platform-agnostic content hash on Filecoin or Arweave. What you really own is the underlying data linked in your NFT contract. This means that the Metaverse and all its contents will always exist, creating a pervasive, incorruptible reality.

With the tokenomics surrounding Filecoin and Arweave, when you store content for use in the Metaverse you can guarantee that your content will always be available. You won't suddenly show up to your house and find it suddenly gone making you virtually, but hopefully not literally, homeless. This extends to every aspect of the Metaverse, if we can not securely and permanently store it with complete fault tolerance then we are doomed to see our reality erode like losing beaches to rising sea levels.

This permanence is important not only for the data itself but how we access it. Cryptographers have worked a long time to ensure that hash collisions are kept to a minimum. So we know your data is secure across platforms, but what about your identity? Aren’t you annoyed when you can’t get the same username on Github and Twitter and it makes it harder to share your social profile with people? When your avatar jumps from Sandbox to Decentraland, will you still have the same name and identifier or is your reputation and everything you were in the old world lost in translation? Handshake provides a potential solution to this with blockchain based DNS and domain names. By having cryptographic ownership of a unique (domain) name at the base internet level, you can securely log in to any platform and maintain your avatar’s identity across virtual worlds, gaming platforms, blockchains, and even web2 apps.

Data Oracles In Blockchain Gaming

Verifiable randomness (VRF) by Chainlink oracles is essential to making fun blockchain games and being able to fairly monetize them. VRF can be used for anything you can imagine - for randomly generated virtual environments, probabilistic games such as gambling, and provably rare autogenerated items sold by game devs. All of these are important components of the Sandbox ecosystem, helping make it a dynamic and exciting virtual world that people will want to continually engage in. Game developers can easily make more fun experiences and users can trust that they aren't being cheated by game studios or other players, making more people likely to play.

Chainlink oracles have an infinite amount of additional functionality that they can bring to the Metaverse and onchain gaming with their custom adapters. Recently Chainlink partnered with Filecoin to enable some of these new usecases. Chainlink can now allow smart contracts to send data directly to Filecoin for storage without needing developers or creatives to directly do the work, taking the burden off game developers to run infrastructure. A game developer could use this to automatically post weekly leaderboards for example. You can also automate repetitive tasks (a.k.a daily quests :P) with Chainlink Keepers to level up your character even faster.

Accessing Metaverse Data

One big issue with building a massive virtual world is how are you supposed to keep track of all the amazing things going on?!? The more vibrant and exciting the Sandbox ecosystem becomes the harder it is to follow. The crypto Data Economy has the answer yet again with The Graph - an indexing service for onchain data that makes it easy to follow every single token transfer, new NFT created, virtual events happening, etc. Most things in the Sandbox universe (excluding individual user movements) can be tracked through The Graph. Being an open source project, you can see exactly what data is available on Sandbox's subgraph and even modify it yourself to track custom data for yourself using your own Graph node. The Graph has already been battle-tested for years and is used throughout DeFi, Metaverse, and onchain gaming dapps.

Handshake domains can also be used to provide semantic URLs to your IPFS hashes (e.g. https://avatar.myusername/ instead of ipfs://QmPK1s3pNYLi9ERiq3BDxKa4XosgWwFRQUydHUtz4YgpqB to get my profile picture) and virtual world locations (e.g. https://frontstage.deadmaus/ instead of https://www.sandbox.game/en/map/?currentX=-106&currentY=2574&zoom=3&liteMap=false&partners=13&x=-63&y=162).

Making URLs simple and easy to identify, as well as tying them to cryptographic keys to prevent phishing, fraud, and DNS hacks, makes virtual environments a much more friendly and safe place for people to spend their time.

Conclusion

The Metaverse isn't just built on the Data Economy, the Data Economy is the Metaverse. Data-centric, chain-agnostic frameworks are what truly create the Metaverse and bring value to its experiences. The more Metaverse projects and blockchain games utilize these data-services the more exciting, innovative products they will be able to provide to their users. They will also be reducing the amount of technical infrastructure and overhead they will have to maintain by outsourcing it to decentralized protocols which frees their resources to invest into more R&D making them more competitive in the market and ensuring their success. Sandbox is already an early leader in this respect having already utilized many of the protocols mentioned in this post. By working together Metaverse and Data Economy projects can create a world that we haven’t even imagined yet.

Disclaimer: I am the founder of the Data Economy Index, a decentralized ETF product that includes the Chainlink, Filcoin, and The Graph mentioned in this article. We make it easy to get exposure to the entire crypto Data Economy by purchasing a single token, $DATA, that is backed by a basket of redeemable tokens for web3 data-based products and services.

This article is part of The Gaming Metaverse Writing Contest hosted by HackerNoon in partnership with The Sandbox.

Submit your #gaming-metaverse story today for your chance to win up to $2000.

Also published on: https://blog.titansofdata.org/the-metaverse-is-built-on-the-data-economy