Creator of Ether cryptocurrency predicts the failure of Metaverse

Vitalik Buterin, the creator of Ethereum, the second most important cryptocurrency on the market, predicts the collapse of the Metaverse as the Meta imagines it. According to him, the concept is still too vague for companies to meet the needs of users. While the Metaverse market is expected to explode in the coming years, the Meta Reality Labs division is in bad shape.

Vitalik Buterin, the creator of the Ethereum network and the Ether cryptocurrency, does not believe in the future of the Meta universe. On his Twitter account, the Russian-Canadian developer calculated that “none of the current attempts by companies to deliberately create a metaverse will lead to nothing.” It is not known whether the computer scientist is of the same opinion regarding decentralized metaverses deployed on the blockchain, such as Decentraland or The Sandbox.

Metaverse, still a very vague concept

In another tweet, Buterin clarifies that he believes the Metaverse as presented by Meta (ex-Facebook) is destined to fail. On the other hand, Vitalik Buterin is convinced that the concept of the metaverse, or metauniverse in English, is on the right track to being realized. But at the moment, this concept is still too vague for companies to successfully implement it.

“We don’t actually know the definition of the ‘metaverse’ yet, it’s too early to know what people really want. So everything that Facebook is now creating will fail,” Vitalik Buterin prophesies.

Companies create the metaverse before user needs are clearly defined, Buterin said. As research firm Censuswide shows, there is a huge gap between consumer expectations and solutions developed by companies. While the majority of internet users surveyed want to save time by shopping in virtual or augmented reality, brands are designing experiences based on reality.

What’s more, a Sortlist poll shows that half of Europeans don’t trust the metaverse as it is currently presented. While “many companies invest 10 to 20% of their marketing or innovation budget” in the metaverse, more than half of users say they don’t trust the concept, notes Sortlist, an advertiser and marketing agency partner finder.

Reggie Fils-Aimé, former director of the American division of Nintendo, agrees with Vitalik Buterin. Asked by Bloomberg last March, he believes the “current definition” of the metaverse will not be successful. Fils-Aimé points to the lack of innovation inherent in the Mark Zuckerberg group.

Note that Meta defines the metaverse as “a three-dimensional space that allows you to communicate, learn, collaborate, and play in ways that are beyond what we can imagine.” As Vitalik Buterin points out, this definition is indeed very vague.

Related: Meta sees Apple as its rival in building the metaverse

The Metaverse of the Meta is in turmoil

After the name change, the Mark Zuckerberg Group has established itself as one of the leaders of the metaverse. Meta has multiplied its investments in this area. Several additional projects related to augmented and virtual reality have appeared in the firm’s laboratories. Parallel to this, Meta also launched software solutions aimed at the metaverse of the future, such as Meta Pay, a digital clothing store for dressing up avatar, and Meta Horizons Workroom, a virtual reality conference room.

Unfortunately, Reality Labs, the specialized arm of the Meta universe, quickly suffered financial losses. For the quarter, the California giant lost $2.81 billion due to the branch. In 2022, Reality Labs has accumulated a loss of $5.77 billion. To cut the deficit and reassure investors, Mark Zuckerberg canceled several projects, including a linked metaverse watch, and pushed back the launch of the first augmented reality glasses to 2024.

Against this background, the Meta stock market has declined by about $160, that is, more than 50% for the year. Despite losses, Mark Zuckerberg continues to defend his vision of the metaverse to shareholders. The CEO says he is “convinced that the development of the metaverse will unlock hundreds of billions of dollars over time, even trillions of dollars.”

Despite the failure of Meta, most analysts expect Metaverse to become a huge market in the coming years. According to Technavion, a consulting and research firm, the market for digital worlds will reach $50.37 billion by 2026. Even more optimistic, the American consulting firm Grand View Research (GVR) expects a market of up to $678 billion by 2030. According to a Gartner study, 25% of people will spend at least one hour in the metaverse in 2026. Can the Meta ride the wave?

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