Applications of the metaverse in the banking industry

Concept:

MasterCard has partnered with New Zealand-based web 3.0 payment protocol Immersve to enable customers in Australia and New Zealand to make cryptocurrency payments straight from their web 3.0 digital wallets. The partnership can enable consumers to make physical, digital, and metaverse purchases where Mastercard is accepted.

Outlook:

According to Mastercard, the number of people using blockchain-based wallets has increased and reached more than 80 million in the last three years. In the future, digital wallets are probably going to become as common as email addresses.  

As Web2 and Web3 merge in increasing numbers, Mastercard is working with some organisations like Immersve to grow and protect the blockchain ecosystem so that billions of users may easily access secure cryptocurrency transactions and even payments in the metaverse. Additionally, Immersve’s solution does not require users' digital assets to be held by a third party as collateral as a result, users maintain full control over their digital currency. 

Concept:

France-based global investment management firm, AXA IM has partnered with UBS Global Wealth Management (UBS GWM) to launch an active metaverse strategy in Hong Kong and Singapore. The strategy helps long-term investors to access potential diversification benefits and gives exposure to long-term growth opportunities offered by the metaverse.

Nature of disruption:

The strategy allows private wealth clients to explore emerging opportunities. It helps to invest in companies in the field of the digital and physical world, offering long-term investment options from the Metaverse in both established and emerging markets.  

To give exposure to long-term trends and enable diversification to reflect everchanging market conditions, the actively managed, multi-cap equity strategy focuses on four key sub-themes: socialising, gaming, working and enabling. It is an ESG-integrated strategy and has a key allocation on information technology and communication services, and the remaining share covers healthcare, industrials, consumer discretionary, real estate, and financial industries.

Outlook:

Technologies have changed the lives of today’s humans and the way they work like socialising, gaming, and doing business. Advanced technology empowers businesses and individuals to explore better opportunities in emerging fields. The Metaverse is where the physical and virtual worlds bump into each other, adding more technology to daily life because of the development of the internet, which connects people, places, and things.  

This active metaverse strategy advances the investment banking sectors and offers new opportunities to its clients.  

Concept:

Beijing’s browser-based 3D virtual world startup Decentraland has launched a virtual (automated teller machine) ATM in its metaverse ecosystem. It was developed to enable players with crypto purchases inside Decentraland’s game world in partnership with London’s startup Transak which offers a developer integration toolkit for fiat-to-crypto payment gateways.

Nature of Disruption:

The virtual Transak ATM is located on Decentraland’s Airdrop Tower and allows players to purchase Decentraland's MANA currency by using fiat currency within the metaverse. The players are directed to fill out a form using virtual machines that necessitates the use of a Transak-accepted credit or debit card for all purchases.  

Additionally, the ATM offers Bitcoin (BTC), Ethereum (ETH), Tether (USDT), and the memecoin Dogecoin (DOGE) for purchase. It also accepts cryptocurrency wallets such as MetaMask and physical wallets like Ledger. Moreover, Decentraland allows users to add branches of the virtual ATM on their Decentraland land plots to enable the metaverse landowners to potentially monetise their properties.  

Outlook:

Decentraland is an Ethereum-based metaverse that allows users to develop their own metaverse experiences. The virtual ecosystem allows users to purchase virtual land and develop it for online gaming and other experiences. Decentraland boasts that notable brands including Samsung and Nike have set up their grounds in the metaverse. In February 2022, Estonia-based crypto exchange Whitebit developed a ‘virtual office’ within the Decentraland’s metaverse that users can tour. Decentraland claims that the virtual ATM can increase conversion rates in metaverse stores and decrease the knowledge gap essential to operating in the metaverse.