Cryptocurrency is a hot topic among futurists and the world of finance. Ethereum tokens are already being used for virtual worlds and the benefits of using cryptocurrency for VR markets only makes the most sense, considering that modern currency is far too geographically tied and VR is boundless.
Cryptocurrencies run on blockchain technology, which are also what NFTs run on. NFTs are Non-Fungible-Tokens which means that the token is unique and can’t be replaced. A bitcoin is fungible because you can trade it for another bitcoin. But each NFT represents a unique digital item, such as art, audio, videos, objects in video games and more.
Even though an NFT is a “unique” token, the digital asset it represents is not. The files are often widely accessible to the general population. So why would someone buy the NFT?
To see the value of an NFT, you might have to consider the art world. People will pay millions upon millions of dollars for the original Mona Lisa, despite being able to print out a copy for a much cheaper price. People love the idea of owning the original file even in the digital world.
Which brings us to the world of virtual reality. Games like Second Life allow you to participate in virtual markets to buy virtual items for your virtual avatar. Items that can be replicated at next to no cost still have paywalls like in our physical world.
Mimicking real-world scarcity in VR with NFTs for virtual clothing, housing, and other assets could be problematic when VR presents a new opportunity for boundless resources. Supporters of NFTs in the VR space might argue digital abundance devalues possessions and scarcity is what creates value.
While artificial digital scarcity could increase value in the general population, it largely stems from our perception of value of rarity. One could also argue however, that getting a new toy for free instead of at a high cost doesn’t necessarily make the toy less interesting to someone who had sought it out.
It’s too early to see if virtual reality will closely mimic the income inequality we see in the physical world, or if it will truly be a boundless place for everyone.