PAYMENTS IN WEB 3.0 and the METAVERSE
In the metaverse-sphere, cryptocurrency and digital art, namely non-fungible tokens, are commonplace. While technocrats, gaming platforms and social media fans are busy talking about the extraordinary experience one will witness in the metaverse, people are looking at alternative digital possibilities and eager to find new pathways to seamless financial transactions.
Interoperability and seamless exchange between underlying blockchain technology are critical to ensure a frictionless user experience. Although within this paradigm, different forms of cryptocurrency are expected to dominate, given the multi-chain trend in the crypto ecosystem, and extensively vast array of ever changing and accessible payment methods, cryptocurrency needs to foreseeably coexist with fiat currencies, central bank digital currencies (CBDCs), and stablecoins.
As the Web 3.0 and the overall Metaverse rapidly evolves into a new iteration of the internet, it will invariably, (as it already has), attract significantly greater scrutiny from global regulators, policymakers, and governments.
Specific to the Blockchain P&E gaming sector, digitally acquired fintech solutions are revolutionizing how transactions are carried out in real life. With cashless transactions witnessing an incredulous upswing globally, their use offers a necessary congruency and real-world backbone to the cryptocurrency and token based P&E industry and will be most necessary to ensure a legal framework is adhered to for financial transactions of this formative economic driver of the Web 3.0 and metaverse ecosystem.
As reported by the Daily Guardian, “NFT, P&E gaming is growing, but the question is whether it can reach people outside of Web3.0?
One keyway to see this occurs is by being able to ensure participants receive secure, timely, reliable, inexpensive ways to pay, earn, transact, and share value. This will be paramount to ensuring the Web 3.0 and Blockchain gaming experience is one that players will want to keep coming back to for a truly immersive and satisfying experience.”
In real life, as witnessed by the $600M+ USD Sky Mavis hack, the financial sector already has its hands full when it comes to security upkeep. As Web2.0 is already subject to endless cyberattacks, the problem will only magnify in the Web 3.0 and the metaverse.
According to Simas Simanauskas, partnerships director at ConnectPay, the credibility of any virtual world will largely depend on having state-of-the-art security in place - this includes all things payments, too.
“Any wallet functionality will require authentication security standards close to Secure Customer Authentication (SCA) used in Europe — anything less, and you risk your customer wallets being emptied in minutes,” he said.
He also noted “it is likely that a significant number of metaverse users will not hold a balance in cryptocurrencies, even though blockchain-based payment methods are expected to dominate. Odds are that users will simply want to shop with their cards or other well-known methods,” Simanauskas said. “The element of familiarity will be crucial, as users will have to be able to recognize a payment method provider before entrusting it with sensitive transaction details — so this is a good time for established fintech’s to start planting their flags in the metaverse.”