UPDATED! Editorial: How the Crypto Crash—and Meta’s Missteps—Are Souring the General Public on the Metaverse

As somebody who writes about social VR and flatscreen virtual worlds on this blog, with a popular Discord server packed with metaverse fanatics and a front-row seat on pretty much everything that has been happening in this space, let me tell you, the past twelve months have been a wild ride. You can even see it in my blog statistics of the number of visitors and views the RyanSchultz.com blog has attracted over the past year:

See that surge from October through March? In October, Mark Zuckerberg announced in a Connect 2021 keynote that Facebook would rebrand as Meta, and would focus on realizing his vision of the metaverse. This also coincided with a crypto speculation boom, where people and companies were frantically bidding for artificially scarce NFT-based plots of land in various blockchain metaverse platforms.

Together, these events sparked a greater awareness among the general public of the metaverse (as indicated by a corresponding increase in traffic to my blog). However, it would appear that the ongoing crypto crash, combined with Meta’s recent woes and missteps, are causing people to sour on the concept. (And by “people”, I mean the general public, not the metaverse fanatics, content creators and world builders whom I tend to hang out with!)

As an illustration of this, I would like to focus on a recent announcement made by Mark Zuckerberg, about the expansion of their flagship consumer social VR platform, Horizon Worlds, from Canada, the U.S. and the U.K. into two new countries, France and Spain:

The first thing I think of when I look at this picture is: hoo boy, somebody working in Meta’s PR department is gonna get fired! You’re trying to sell people on Horizon Worlds with this unappealing, uninspiring, and frankly ugly image on Twitter?


The response to this on two different subreddit communities on Reddit, r/technology and r/Buttcoin, proves to be quite illuminating. (By the way, r/Buttcoin is the blockchain, crypto, and NFTs snark community, where we cryptoskeptics and critics love to discuss and dissect the latest shenanigans, antics, and scams in that world!)

Here are some of the better comments on the r/technology post, sparked by Paul Tessi’s biting August 17th, 2022 Fortune article, Does Mark Zuckerberg Not Understand How Bad His Metaverse Looks?

It looks like Mark Zuckerberg watched Ready Player One and thought he would be able to recreate that universe with MS Paint.

“Looking forward to seeing people explore and build immersive worlds!” :: “Work in my content mill, peasants.”

The more money they dump into this dumpster fire, the better chance Facebook finally collapses into the abyss. So keep doing it Zuck.

One much-upvoted comment reads as follows:

No one is building a $1500-2500 PC with [a] dedicated GPU to add a Facebook $600 VR headset to attend work meetings in a virtual space that looks like a kids CGI series from 2004 at a mass adoption level, where the majority of the public would use it daily for 8 hours at work then again for another 4-6 hours “for fun” at home, as the Meta dystopian dream suggests.

Meta has already been subsidizing the costs of their currently meh headset, which they just increased the prices of, as they were losing too much money.

For this to work, the hardware has to be good enough for grandma to be able to buy it on a pension, put it on out of the box and it just works, and it does not make her sick to her stomach in 5-20 minutes due to the low frame rates and quality.

That’s the barrier of entry to the space you need to be able to target… if that old guy at your office struggles with getting their mic to work on MS Teams for a video call every day, as the manager he is not going to order $100,000 worth of gear for your department that is hard to setup and use to meet in the metaverse.

This thing is dead on arrival, but Facebook is also dying/dead in it’s current form, so this Hail Mary [pass] is all they have.

In the August 17th Fortune article which spawned these responses, reporter Paul Tassi writes:

The thing is, this happens all the time with Zuckerberg and his metaverse because Horizon Worlds has looked terrible since its inception and has barely gotten any better over the years, where its avatars still look like Miis from 2012 and they still don’t have legs.

Granted, I understand that showing 2D screenshots of VR is difficult, and that VR generally lags behind traditional console and PC gaming in terms of graphics. And yet that doesn’t change the fact that even within VR, Horizon Worlds is one of the worst-looking offerings I have seen, and that Meta has spent something like $10 billion chasing its Horizon, VR-centric version of the metaverse, even embarrassingly changing their company name to reflect that. And…this is the result.


Meanwhile, here are some of the opinions of the cryptosnarkers over on r/Buttcoin:

If I was a Meta stockholder I would be selling the minute I saw that screenshot.

He (and many others) are hoping that nobody remembers Second Life ever existed, let alone that it still does. It has a dedicated audience of somewhere between half to one million users and that’s kinda it. I suspect the future for “the metaverse” is similar.

One r/Buttcoin member posted the following detailed comment:

This is the part I don’t understand. Any “meta” style environment will be incredibly limited in terms of graphics and gameplay due to the need to have a high number of players at once. So who is the target audience?

• Someone looking to play a game is going to go with something like Grand Theft Auto V (and continue to move on to the next biggest thing when they come out).
• The live concerts! aspect of the website seems equally absurd given the graphical limitations and that this would be less entertaining than watching a concert on TV.
• Your casual Farmville-style person isn’t shelling out hundreds of dollars for a VR headset.
• For their “practical” concepts like virtual stores, it seems to invalidate the concept of buying metaverse land as either the system will allow for fast travel style movement (making “premium” land a joke), or not allow for this travelling and completely turn off their customer base for this.

I just don’t see where the interest comes from.

And I chuckled at this wag’s opinion:

Second Life managed to survive because it fostered a community of weirdo people who fetishized the environment. I think the only person who fetishizes Facebook’s metaverse is Zuckerberg.

Absolutely SAVAGE! I live. Somebody else posted this gem to the r/Buttcoin subreddit:


Even worse, the cryptobros are starting to dunk on the metaverse, notably Shark Tank billionaire investor Mark Cuban. According to an August 8th, 2022 report in Fortune:

Mark Cuban, the billionaire Dallas Mavericks owner and avid crypto enthusiast, is not sold on the metaverse.

“The worst part is that people are buying real estate in these places. That’s just the dumbest shit ever,” he told the crypto-themed YouTube channel Altcoin Daily this past weekend.

I’m quite sure that the various blockchain-based metaverses like Voxels (formerly known as Cryptovoxels), Decentraland, Somnium Space, and The Sandbox, all of whom have seen the value and the trading volume of their NFT-based real estate decline during this crypto winter, were not expecting the ridicule and disdain of crypto influencers themselves! After all, the crypto crowd are main target audience of these platforms, not your average non-crypto user. You know things are getting weird when the cryptobros start to turn on each other!


So, what does all this mean? Well, it looks as though the concept of the metaverse, at least among the general public, is going to sustain some reputational damage, at least in the short term (12 to 24 months). Perhaps it was inevitable that there would be such a swing from irrational metaverse exuberance to equally irrational metaverse distaste, even disgust.

I am reminded of the Gartner technology consulting group’s well-known Hype Cycle, where we appear to be rapidly moving from the peak of inflated expectations, to the trough of disillusionment:

The five steps of the Gartner Hype Cycle (source: Wikipedia)

Also, this “trough of disillusionment” means that it’s going to be harder to sell consumers and businesses on the metaverse. This will apply both to behemoth corporations like Meta, Apple, and Alphabet (the parent company of Google), as well as to much smaller metaverse-building companies. As I have said before, not all platforms currently being worked on will survive this rough period.

It is possible, perhaps even likely, that only a handful will achieve dominance in this ever-evolving market, leaving the other firms to fight over the leftover scraps. Of course, some companies will be savvy enough to focus on a profitable niche market, such as the surgical training platform FundamentalVR, which recently received another venture capital infusion of US$20 million.

So, as Bette Davis once memorably said in the movie All About Eve: “Fasten your seatbelts…it’s going to be a bumpy night!”

UPDATE August 19th, 2022: As further evidence of the antipathy towards Mark Zuckerberg’s latest announcement, Zack Zwiezen wrote this scathing report for Kotaku, titled Mark Zuckerberg’s Soulless Metaverse Avatar Has Me Worried About Our Digital Future:

Earlier this week, the alien-wearing-a-human-skin-suit known to us as Mark Zuckerberg posted a VR selfie from inside his company’s metaverse project, Horizon Worlds. The selfie showed off the Eiffel Tower and was meant to announce that his metaverse is expanding to more countries. Instead, however, people immediately began dunking on the terrible picture, the ugly avatar, and how it all looked like it fell out of a 2005 edutainment game

And that brings us to 2022, where Zuckerberg’s avatar is a legless knock-off of a Nintendo Mii with some really weird buttons and the eyes of a corpse. And this isn’t just how Zuckerberg looks, this is the way all avatars appear in Horizon Worlds. I’ve played enough Horizon Worlds to tell you that the missing legs quickly cease to matter. But the lack of style and the cold, dead aesthetic never goes away.

Sure, part of the reason these avatars and worlds look simple and ugly compared to modern video games comes down to the limited VR hardware in Quest 2 and Facebook’s desire to make VR content that can run on as many devices as possible.

On the other hand, I can find Nintendo DS and Sony PS Vita games with better, nicer-looking art and models than what we’ve been shown so far in Facebook’s metaverse. I also don’t think you can blame the people making this stuff, as I assume they are more than capable of doing better and more vibrant things. But more and more, it seems that isn’t what Meta and Zucklehead want. Instead, they are focused on making a product that can be consumed by the masses and which lacks any defining characteristics in an attempt to get more people to dive in.

This is the exact opposite approach we see in more community-driven VR metaverses like VR Chat, which looks better and feels warmer and more inviting. In comparison, Horizon Worlds looks like an animated video I’d walk by in some fancy hospital while I look for the bathroom.

And if this bland and ugly metaverse is the future Mark Zuckerberg wants and is investing billions of dollars into, I’m worried that it could end up winning out over other, better alternatives simply because he has the money and resources to squash or buy up competitors. Well, if it does win out, at least I’ll be able to skip it and not buy a new VR headset.

Yee-OUCH!!!

Also, as further evidence of the distress in the entire cryptosphere, Bloomberg reports that ad spending by the crypto firms has absolutely cratered:

Spending by major crypto firms, including the trading platforms Crypto.com, Coinbase Global Inc. and FTX, fell to $36,000 in July in the US, according to ISpot. That’s the lowest monthly total since January 2021 and is down from a high of $84.5 million in February, when the industry flooded the airwaves around the Super Bowl.

Again, Yeee-OUCH!!! And it looks like things are not going to get better anytime soon, as inflation roars and recession looms. People have more important things to worry about (like keeping food on the table and a roof over their heads) than buying virtual real estate on the blockchain!

In December 2021, Republic Realm spent approximately US$4.3 million worth of land in The Sandbox, setting a record for the most expensive land sale in the metaverse (more about Republic Realm here). It would appear to be highly unlikely that Republic Realm, or any of the other investors who bought NFT-based plots of virtual land at the height of the boom market, are going to be able to earn a profit anytime soon.

Has the bottom fallen out of the NFT-based metaverse market? And what does this mean for the concept of the metaverse in general? Stay tuned!

UPDATED! Blockchain, Crypto, and NFT Metaverse Platforms: How to Spot a Scam

Image by Tumisu on Pixabay

Not too long ago, I wrote up a blogpost about an NFT-based metaverse project called Wilder World. As part of my research, I joined the Wilder World Discord server. This morning, I got a direct message from someone with the account name Wilder World, with a come-on to invest in a “limited-time presale” of Wilder World virtual land.

As I suspected, this was a scam. I know this because I know that legitimate NFT metaverse projects do not direct message users via Discord. (I have seen similar messages before, borrowing the names of projects such as Cryptoland, Decentraland, and Somnium Space, to the point where I recently issued a warning via Twitter:

I also got a DM via Discord from them this morning. In the past month, I have received phishing offers from scammers impersonating Cryptovoxels, Decentraland and Somnium Space. Caveat emptor! These are all scams. #MetaverseNFT

Getting back to the scammer from Wilder World, I read the message carefully, and noticed a couple of signs that something wasn’t quite right.

First, in a direct message, Discord will inform you if you and the other person have any Discord servers in common. The fact that Wilder World and I had “no servers in common” is a big red flag. You seriously mean to tell me that the REAL Wilder World would contact me from a Discord account that doesn’t even belong to the official Wilder World Discord server?

Second, I checked the URL against the list of official links in the #official-links channel on the official Wilder World Discord server, and did NOT find this new, suspicious URL on it! (I blurred out part of the URL address in the previous image.) If the Discord server does not have such a list (and all legitimate projects should), then look for it on the official website. Never click on a new, unfamiliar URL you have not thoroughly investigated first!

It is all too easy to target people who have joined an official Discord server for NFT metaverse projects, since you can easily see who else is with you on the server (just check the far right-hand column). It’s also very easy to create a false account by stealing an official logo and calling yourself the project’s name (e.g. “Wilder World”). There is nothing stopping you from creating as many Discord accounts called Wilder World as you wish, since each one has a separate, randomly-generated four-digit suffix at the end of the username (see image, right).

And, unfortunately, some people always fall for this particular scam which appropriated the logo and name of Wilder World, using a well-written come-on and a fake website to take that person’s hard-earned cryptocurrency:

A: That was a scam, I think
Victim: are serious?! ffs

B: There is no land stuff [right now] The focus is on Pets.

Victim: I just filled it out!

A: So any land sale is a scam [right now]

Victim: omg did I just get scammed

C: There was a scammer yesterday DM’ing people

Victim: wtf it was a message from Wilder World
D: From a scam CLONE
E: oh noooooooo Wilder World never DMs u!!
F: Was a scammer with a WW logo on their profile
G: [refers Victim to the -scammers channel]

H: Land is not for sale yet, only raffle for mint list is available on [Wilder World] website, click the link in announcements

And I went over to take a look at the -scammers channel on the official Wilder World Discord server, to see this, plus numerous other scams being reported on. The Victim did report this scam on that channel (see image right), but unfortunately, any money he thought he was spending on NFT-based virtual land in Wilder World is unrecoverable.The scammer, once he or she fleeces a number of people, then deletes the Discord account and the website, and vanishes into the night—likely to repeat the same scam on a different target in future.

So, once again, I am going to list the things that you can do to avoid getting scammed via a direct message on Discord for the various and sundry NFT metaverse projects:

  1. Legitimate projects will not direct message you on Discord. Instead, they will use an #announcements channel on their official Discord server, or perhaps post a blogpost on their official website.
  2. Always check any DM you receive via Discord to see what servers you and the other person have in common. If you and the other person have “No servers in common” (particularly, the official Discord for the legitimate project), that is a red flag! I belong to almost a hundred Discord servers related to social VR, virtual worlds, and the metaverse, and I now routinely block any DM from someone where I have “No servers in common”. The reasoning is this: anybody whom I am interested in talking to should belong to at least one of the same Discord servers as I do!
  3. Check the various channels of the legitimate NFT metaverse project Discord server carefully. Look for an official announcements channel. Look for an official links/URLs channel, either on the Discord or on the project’s official website. Look for a channel to report potential scams and scammers.
  4. Always stop and ask yourself if something is too good to be true. Be highly suspicious of any “good-will gesture” such as the following example, taken directly from today’s Wilder World scammer: “As many of you may have expected, there has been talks of a land sale coming up and we are excited to officially announce…As a way of giving back to those who supported Wilder World early, we will be hosting a limited-time presale to raise liquidity and allow our users to buy the land early before…”.
  5. EDUCATE YOURSELF ON BLOCKCHAIN, CRYPTOCURRENCIES, AND NON-FUNGIBLE TOKENS! If you aren’t willing to take the time to learn how all this works, you are better off staying out of this arena until you do.

I leave you with a few articles on the subject of blockchain/crypto/NFT scams (I’m sure you can find many more on your own):

REMEMBER: Do EVERY. SINGLE. SCRAP. of your homework before investing in any blockchain. cryptocurrency, or NFT project! Be especially cautious when you receive a direct message on Discord!!! Caveat emptor!

UPDATE 4:17 p.m.: Someone on the official Wilder World Discord server shared the following handy tip:

You should turn off server DMs from any NFT Discord you’re in – just click on the server name, select Privacy settings from the drop down menu, and switch them off. NFT Discords will never DM you directly.

To Teleport or Not to Teleport: Teleporting Versus Walking in the Metaverse

Ever wish you could teleport in real life?
(Photo by Chris Briggs on Unsplash)

Earlier this week, I had a guided tour of the blockchain-based social VR platform Somnium Space, where I was informed by my tour guide that the virtual world had just implemented teleporting. Scattered throughout the one large, contiguous virtual landscape which comprises Somnium Space were teleporter hubs, where you could pull up a map, click on the teleporter hub you wanted to travel to, press a button, et voilà! You were instantly transported to your destination.

A teleporter hub in the central city square of Somnium Space (at night)
The red arrows indicate the location of teleporter hubs on the map

What makes Somnium Space unusual among metaverse platforms is that you cannot simply teleport from one place to another distant location; you either must make use of the provided teleporters, or walk/run/fly/swim to your destination. (Of course, you can certainly “short hop” using a limited form of teleporting, but that is only for shorter distances, not for instantly getting from one end of a large, contiguous landmass to another.)

In other words, the teleporter hubs of the Somnium Transportation System are set up much like a modern urban subway system, where you can only travel to a particular, pre-built subway station that is situated the nearest to your intended destination, and then walk the rest of the way. Many people might remember that in the very earliest days of Second Life, there were also teleporter hubs in the days before avatars could instantly teleport themselves from one location to another!

Another thing that sets Somnium Space apart from other social VR platforms is that there are only going to be so many “public” teleporter hubs. In face, some of these hubs are going to be auctioned off as NFTs (Non-Fungible Tokens), and the successful bidders with such a teleporter hub on their properties will be able to charge a cryptocurrency fee in order to use their teleporters! (In other words, they would operate much the same as a real-life toll road or highway.)

Closely intertwined with the idea of teleporting vs. walking is the layout of a metaverse platform. Is it one large contiguous landmass, like Somnium Space, Decentraland, Cryptovoxels, and (to a certain extent) Second Life? Or is it a collection of smaller worlds, like VRChat, Rec Room, Sansar, and Sinespace? If it is the former, then means of transportation (and ease of access to transportation) becomes more important. If it is the latter, then another tool which many of the newer social VR platforms offer is the ability to create a portal—either temporary or permanent— between two worlds. (Of course, you could consider a teleporter hub a portal.)

So, keeping all this in mind (particularly the distinction between SHORT HOP teleporting and teleporting to a DISTANT location), we can create a chart outlining the transportation affordances of the various metaverse platforms:

Name of Platform (Layout)Walk/Run? *Distance
Teleport?
**
Create Portals?
Second Life (mostly one contiguous landmass, with private islands)YESYESYES
Sinespace (separate worlds)YESNOYES
Sansar (separate worlds)YESNO (but you can create teleport hubs)YES
VRChat (separate worlds)YESNOYES
Rec Room (separate worlds)YESNOYES
AltspaceVR (separate worlds)YESNOYES
NeosVR (separate worlds)YESNOYES
Cryptovoxels (one contiguous landmass with some islands) YESNO (you can add coordinates to a URL, though)YES
Decentraland (one contiguous landmass) YESYES (/goto X,Y)NO
Somnium Space (one contiguous landmass)YESNO (but there are teleport hubs)NO (unless you count teleport hubs)
* – Can a user walk/run/fly/swim from one location to another? This includes SHORT HOP teleporting.
** – Can a user personally choose to teleport from one location to a second, DISTANT location?
† – Can a user create a temporary or permanent portal from one location to another?

Obviously, all metaverse platforms offer some form of personal locomotion for your avatar (walk, run, fly, swim, short-hop teleporting, etc.). This is standard.

It is also clear from this table that the metaverse platforms which consist of many smaller worlds (Sinespace, Sansar, VRChat, Rec Room, AltspaceVR, and NeosVR) all prefer the creation of temporary and permanent portals to allowing users to teleport great distances on their own steam. On the other hand, all the social VR platforms and virtual worlds which consist of one contiguous landmass tend to allow some form of teleportation across great distances.

You will notice that Cryptovoxels uses a rather brute-force method of “teleporting”, which consists of appending the coordinates to the end of the URL you enter into your web browser client (which are much the same as the coordinates which form part of the SLURLs used in Second Life, but not nearly as convenient in my opinion).

Transportation affordances are yet another way to classify metaverse platforms in my continuing effort to create a taxonomy of social VR platforms and virtual worlds.

So, what do you think? Have I made an error in my table? Do you have an opinion about the benefits of teleporting and portals versus walking around and exploring the landscape? I’d love to hear your opinions, so please leave a comment, thank you!

Editorial: Fuelled by the NFT Boom, Blockchain-Based Virtual Worlds Are Having a Moment—But Will It Last? Is It a Bubble?

A Reuters news article posted today, titled The ‘metaverse’ bet: crypto-rich investors snap up virtual real estate, which first came to my admittedly-distracted attention as a trending news item in my Twitter news feed, starts off as follows:

What do you do with a $69 million artwork that doesn’t physically exist?

That’s the question faced by the Singapore-based investor calling himself Metakovan, who made headlines last month when he bought the digital artwork “Everydays: The First 5000 Days” by the American artist Beeple at Christie’s.

The work is a non-fungible token (NFT) – a new type of virtual asset that has its ownership status and authenticity verified by blockchain. NFTs have exploded in popularity in 2021, with prices skyrocketing.

Metakovan, real name Vignesh Sundaresan, plans to put the artwork on display in four virtual world environments. He is working with architects to design gallery complexes that the public can enter via web browsers or virtual reality technology.

Blockchain-based virtual worlds are definitely having a moment: the following trending news story showed up on my Twitter feed

It is clear to anybody that is paying attention that the NFT (Non-Fungible Token) boom is sparking intense interest and resulting speculation in the blockchain-based virtual worlds where such NFTs can be displayed: Cryptovoxels, Decentraland, Somnium Space (all already launched and seeing more and more business) and The Sandbox (which launched its first phase on March 31st, 2021). It seems like every second room on the hot new drop-in social audio app Clubhouse is about NFTs and how to get into the market.

Market speculation in the first three blockchain-based virtual worlds has only intensified recently, with previously unheard-of trading volumes and rapidly escalating prices as bidding wars break out over virtual properties. Here is a graphic linked to from the aforementioned Reuters article, showing just how suddenly land values have jumped in Decentraland (and I’m quite sure that early investors are rubbing their hands with glee!):

And some big-name companies are being attracted to the blockchain-based virtual world marketplace (quotes are from the Reuters article up top):

In what will be one of the biggest names to join the party, videogame maker Atari told Reuters it planned to launch its own blockchain-based virtual world and would soon announce details.

Online environments are going to be “very very big”, regardless of fluctuations in the price of bitcoin, said Frederic Chesnais, head of Atari’s blockchain division and the company’s former CEO. NFT real estate could one day fetch millions of dollars, he added.

Atari, ahead of its plans to open its own blockchain-based world, has licensed a retro arcade within Decentraland and is due to open a casino.

Among the people interviewed for the Reuters article was the creator of Cryptovoxels, Ben Nolan, who expresses caution in the current feverish NFT market:

“I expect that there’ll be a crypto winter in the next couple of months, the whole NFT boom will explode and then all the value will absolutely collapse,” said Ben Nolan, founder of the virtual world Cryptovoxels.

“Doing NFTs as an investment or as a way to make money is really ill-advised.”

However he does see a future for virtual worlds and NFTs.

“Do I think most people will use virtual worlds? Probably not, but I think a lot of people will and I think NFTs are a big part of that growth,” he said.

“Actually walking around with another person in a virtual space and looking at art together is a really nice way to spend time,” he added.

We can expect that more companies will enter the blockchain-based virtual worlds marketplace, attracted by the possibility of making profits from virtual real estate—whether that real estate is used for galleries to show NFTs or not.

Interesting times! I choose to remain safely outside the fray, peering in occasionally to write the odd blogpost—emphasis on odd 😉 . The following are links to all my previous blogposts written about four of the currently available (or soon-to-be-available) platforms:

Stay tuned for further dispatches from the blockchain-based virtual worlds and social VR platforms! (Yes, both Cryptovoxels and Somnium Space support VR.)

And I’d love to hear from you: Do you hold land on these four platforms? Do you think we are in a financial bubble? Feel free to sound off in the comment section!

We’d love to hear form you!