Is the Metaverse Overhyped?

by
Blockchain
Is the Metaverse Overhyped?

Since its inception, the metaverse has divided opinions ― some see it as the next big thing since the birth of the internet and the future of how we perceive reality. In contrast, others think the growth and importance of the metaverse may not be as significant as it seems.

Regardless of how you look at it, the metaverse has been on everyone’s lips since it came into the limelight via its numerous applications, especially in the crypto sphere.

Where It All Started

The metaverse is by no means a new phenomenon. It was first mentioned in the 1992 science-fiction novel Snow Crash by Neal Stephenson. The author described the metaverse as a “virtual world” where people can interact with each other through their avatars or metaverse bodies. Although Stephenson’s idea of the metaverse is perhaps rudimentary, one could argue that he foresaw what the future of the internet could be.

Over the past few years, we have seen some of the biggest tech brands invest in the metaverse. Facebook even rebranded to “Meta,” signifying its total interest in leveraging the potential benefits of the metaverse. There have been speculations about Apple actively developing metaverse-inclined products such as Apple’s RealityOS and its AR/VR Headset.

Low Turnout in the Metaverse

Despite the apparent potential of the metaverse to revolutionize the internet, there are serious concerns about its low user growth and inflated level of involvement among people, especially the younger generation.

In August 2022, a report by global data and measurement-driven full-service agency, Essence explained how investing in the sandbox game, Roblox, and other metaverse companies might not be a good idea at the moment, suggesting that the hype around the metaverse concept may be overblown.

The research dubbed “Manifest Metaverse: A realistic look at the next digital frontier” indicates that Roblox records 54.1 million daily active users for the first quarter of 2022, which is disproportionally small when compared to platforms like Twitter, which has 229 million daily active users, and Facebook, which stands at 1.93 billion.

Essence attributes the low numbers recorded in the metaverse to the slow global adoption rate of the metaverse. The report surveyed people in nine markets and found that only 33% of people understood the concept of the metaverse, 37% had heard of it but weren’t sure what it meant, and 30% had never heard of it.

More recently, DappRadar, a data aggregator and global app store of decentralized applications, revealed that metaverse giants, The Sandbox and Decentraland, are experiencing very low turnouts in their metaverse platforms. DappRadar suggests that these metaverse platforms record less than 1,000 “daily active” users, despite both companies being valued at more than $1 billion.

Embed tweet: https://twittter.com/unusual_whales/status/1581721890279653376

More specifically, the Ethereum-based virtual world Decentraland had 38 “active users” in the past 24 hours, while competitor The Sandbox had 522 “active users” in that same period.

An active user, in this case, is referred to as an individual with a unique wallet address who interacts with the platform’s smart contract and trades with the platform’s native utility token.

Both Platforms Refute the Claims

It is perhaps no surprise that both metaverse platforms have debunked DappRadar’s assessment. Decentraland has gone ahead to label the report as “misinformation.” According to Sam Hamilton, Creative Director at Decentraland, from From Oct. 3-9, the platform averaged 6,999 “unique visitors per day.”

The Sandbox also refuted the metrics used by DappRadar to determine the number of active daily users, stating that the metrics “only reflect transactions between users or a primary NFT sale and not other forms of meaningful engagement.”

Following the platforms’ response, DappRadar admitted that the metrics used to determine the number of active users may be flawed and that the company is developing new ways to accurately determine the number of “active” users interacting with dApps.

Despite the disputed numbers, what remains clear is that the level of participation in the metaverse is low and often inflated by the platforms. We’re still in the early days, and it will be interesting to see if the metaverse will live up to the hype.