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I was starting my morning and preparing to interview Franco Niebles and Juan Guillermo Sanchez, the developers of El Salvador’s digital wallet, Chivo Wallet. I had many questions about cryptocurrencies, the Blockchain, NFT’s or DEFI, but none as revealing as the question that would arise after a comment from Franco in the middle of the conversation: “In the Metaverse is where you will really start to see the value of these assets.”
In my head, something clicked immediately. I understood perfectly what Franco was referring to. The announcement of Facebook’s conversion to Meta, and its transformation to a digital reality company, was in complete sync with the social media giant’s investments last year in its own digital currencies, Paxos Dollar and Diem (formerly called Pound).
At the time of its announcement, it seemed odd that a social media company would be among the first businesses to create its own digital currency, though certainly an innovation, still bitcoin and other cryptocurrencies seemed a fully speculative investment. Why did Facebook want to enter the world of cryptocurrencies?
Along came Meta, the virtual universe that the once Facebook is working on, although I didn’t see it at the time, after the conversation with the creators of Chivo, it seemed logical that a digital universe would work with digital currencies.
There are still many things to be seen in these new metaverses, which are often mistaken for virtual reality video games. Undoubtedly the creators of this industry have a lot of knowledge to contribute to the metaverses of the future, so I decided to contact Isidro Quintana, CEO of Triple O Games, to enlighten us about it.
NFTs and videogames
“How do we get people to own digital goods within video games?” asks Quintana. “Until now you have been able to buy things inside a video game but you have not been able to sell them, and this is because you have bought is a license of use, not a right of ownership of the digital good,” explains Quintana.
With blockchain and NFT, Isidro predicts, users of the digital world will own their digital assets, and will be able to monetize those assets: “if you manage to tokenize the digital asset within the video game, you can sell it and therefore, if you can sell it, you can earn money, this concept is called play to earn.”
Although the concept may seem very new, the reality is that it is inspired by one of the oldest video games, Super Mario Bros. In the eighties nintendo classic, players earned gold coins by destroying blocks in the air or stepping on turtles, and when they reached 100 coins the player earned an extra life in the game.
The concept of NFT’s in video games is not very different from Super Mario, it is about rewarding players for playing: “there is an intrinsic motivation that would make you play the video game because you are earning money by playing”, explains Isidro.
But the question on everyone’s mind is: where does that money come from?
“When you tokenize an asset you do it like in the stock market, when you take a company public everyone can invest in the company’s shares. With blockchain, with a public sale token, people invest by giving liquidity to the token and depending on how much they invest it will give more or less value to that new virtual currency,” explains Isidro.
Triple O Games’ first game is Battle Derby, a multiplayer car game available on IOS and Android, the cars in the game can be customized “with a humorous touch”, Isidro adds.
“We are mainly focused on the interoperability of the NFT, we want the cars to be used, or the customizable elements of the car —tires or the rearview mirror— to be an NFT,” Isidro says about the car, “we would make an agreement with other metaverse projects, such as Sandbox, and the idea is that you can use the car in the virtual world [of Sandbox]”.
The game has its own token that can be earned within the game and can be exchanged like any other token circulating in the market, such as bitcoin or ethereum.
The NFTs revolution in the metaverse
“What the metaverse invites is decentralization and tokenization, we are talking not only about an open world, but an open world where you own the digital things that appear.”
For Quintana, NFTs are the channel through which property rights are going to be guaranteed in the metaverse, and because of their decentralized nature, they will force future digital ecosystems to become decentralized as well.
“Facebook is trying to position itself [in the metaverse] as a central entity, where I personally believe they stand to lose in the long term, because in the end people want tools to create content, we have gone from being consumers of content to creators, and the metaverse is going to see that,” Quintana predicts.
Despite Isidro’s prediction about the advantage of decentralized metaverses over the centralized version of Meta, there are still many challenges to be met, because as he states: “we are still like the internet in ’99”, referring to the so-called .com bubble, where the financial market suffered a sharp drop due to the number of fraudulent internet spin-off companies or that never managed to monetize.
“One of the main challenges for those of us who are developing NFTs is that we have to leave the protocols open enough to be as interoperable as possible in the digital world,” says Quintana.
Despite the challenges of decentralization, Quintana believes that in ten years “we will have a decentralized metaverse where brands are part of it, and where governments are part of the metaverse.”
Economist, writer and liberal. With a focus on finance, the war on drugs, history, and geopolitics // Economista, escritor y liberal. Con enfoque en finanzas, guerra contra las drogas, historia y geopolítica