JP Morgan Enters the Metaverse
What is an NFT?
Non-fungible tokens (NFTs) have taken the world by storm. These tokens are part of the blockchain movement that started with Bitcoin and are a form of asset tokenisation. NFTs can be defined as unique cryptographic tokens that possess intrinsic value for the owner. They can be traded or hypothecated in the case of healthcare records. Examples of NFTs include digital art, music, bags and any personal item that is unique to the individual. Essentially NFTs are evidence for the authenticity and existence of digital assets, they can be either transferable or non-transferable tokens.
Into the Metaverse
JP Morgan is officially the first major bank to enter the nascent metaverse. The metaverse is a stimulated digital landscape that utilises augmented reality (AR), virtual reality (VR) and blockchain. This is a unified virtual community designed for work, play and relaxation. There is no concrete definition of the metaverse, as it is so early in its evolution. As supply and demand force more people into the meta-economy, the longevity of the metaverse becomes clearer. The space is designed to supplement social media and create virtual spaces that mimic the real world.
How important is the metaverse?
There are predictions that the metaverse will infiltrate every sector in the coming years, as the predicted market value is now estimated at over $1 trillion. Just like cryptocurrency, the metaverse is here to stay. There is tremendous advertising potential for the metaverse, as retail giants such as Nike are already entering the virtual market with NFT-based products and shop fronts.
What does this mean for financial services?
There are plans to scale the metaverse across multiple currencies and payment methods. This means that the workplace of the future could include community managers who oversee the creation of robust online and offline relationship-building, this will help to strengthen engagement and cohesion across the platform. There is potential for new jobs for event producers that specialise in immersive metaverse experiences for personal and work events. For example, there is potential that virtual concerts could become more profitable than in-person events as there are fewer barriers such as capacity and parking.
How is JP Morgan involved in the metaverse?
It is now possible to do your banking in the metaverse since JP Morgan opened their lounge in Decentraland. This virtual lounge is called Onyx Lounge and allows people to purchase virtual plots of land using NFTs as well as other purchases using cryptocurrency. Onyx is located in Metajuku which is the virtual version of Tokyo’s Harajuku shopping district. An avatar of the CEO of JP Morgan greets you before you enter the lounge, for a personalised experience. There is also a tiger that walks across the virtual lounge for added flare. This lounge can act as a launchpad for JP Morgan to delve into its role in the digital landscape. The company already has a blockchain-based subsidiary, which means a shared, immutable record for transactions and tracking assets.
JP Morgan metaverse report summary
JP Morgan published a report alongside the launch of their lounge to explain to customers what the metaverse is and to encourage other firms to get involved. The report highlights the importance of a fluent connection between the physical and virtual world, which JP Morgan is confident will only continue to grow. Household names such as Nike, Gap, Hulu, Adidas and Verizon are entering the metaverse. JP Morgan has made it clear that the metaverse will not replace human interaction, but rather provide exciting new opportunities for consumers and brands. The company have also discussed their plans to launch a gaming platform with bank-grade products and digital assets platform access. This will include unparalleled security, unique onboarding products and a robust assets infrastructure.
A Fortnite concert, which was viewed by over 45 million people had a gross profit of $20 million, this was partly due to lack of geographical barriers. People who would have been unable to attend a physical concert were able to join from the comfort of their homes. The metaverse presents an endless opportunity for collaboration and creativity. Just like cryptocurrency, it appears that the metaverse is here to stay and large corporations are encouraged to join this contemporary landscape.