Professor Paul Hopkinson is the head of Edinburgh Business School at Heriot-Watt University Dubai and academic lead for Heriot-Watt Online
Despite the fear that comes with new inventions and developments destabilising our reality and our way of living, we fail to realise that these developments are only a response to changes that are already taking place. In other words, technological innovations and other developments are a response and an attempted solution to current global shifts. As the world changes around us, necessitating new ways of being and functioning, we look for innovations that suit our current needs. With movement being restricted during the pandemic and causing major disruption to the global economies and nearly all aspects of our life, the need for access to work, healthcare, and other forms of livelihood irrespective of one’s location became necessary.
Currently, the uncertainty surrounding emerging technological concepts such as the metaverse and blockchain is understandable. This uncertainty is due to the pace of change that the world has undergone in only two years. However, it is important to view the metaverse as the next natural evolution of the internet. Previously, we passively accessed content online through its current form. We then moved to interacting with content through dynamic platforms such as social media through reels and stories. And today, built on the foundation of blockchain technology, the metaverse can take us to the next step: engaging with digital content in 3D and ushering us into Web 3.0.
Beyond emulating our physical reality, the use of blockchain technology becomes imperative for doing business. The pandemic has also revealed faults within our current economic systems, thereby increasing the appeal of a decentralised and self-regulated economy. With the use of blockchain technology, not only can we create digital assets, but we can enable their ownership transfer and transactions. Therefore, blockchain technology is an essential component to the existence and scalability of the metaverse. As brands increasingly realise this, we are seeing more companies invest in NFTs and blockchain technology. Nike is a good example of this; the apparel giant has acquired RTFKT studio, a digital collectibles company, which will allow the company to sell virtual sneakers to outfit people’s avatars in the metaverse. This is a testament to Nike’s recognition that they will not be able to offer and sell virtual sneakers in the metaverse without the use of blockchain technology. Furthermore, Nike’s acquisition of RTFKT studios expands the company’s potential for digital innovation in the metaverse. Owning RTFKT means Nike will be able to develop the technology of the digital collectibles studio in a way that suits its brand objectives.
Further to the potential for digital innovation that comes with operating in the metaverse, the economic potential that the metaverse unlocks is attractive to companies and governments around the world. The decentralisation of the metaverse, which means that it is not governed by a central authority, can create resilient business models where ownership of digital goods and services is not controlled by a single brand. This means content creators can connect directly with their audiences and benefit from their own creation. In addition, the increased security of ownership in the metaverse encourages businesses and governments to invest. For example, Dubai announced its entry into the Metaverse of The Sandbox, making the UAE the world’s first regulator to make its debut in the metaverse. Users on the Sandbox can buy a plot of land and build it with the help of a skilled developer. By reason of being held on the blockchain, the asset will belong to the user forever unless they decide to sell it. The ease of traceability and security inherent in ownership in the metaverse is therefore a major attraction for investors.
Countries like the UAE recognise the immense potential that the metaverse provides. In addition to recently announcing its entry in the Sandbox, the country has already taken several other steps in this direction. For example, at the beginning of this year, the UAE has launched the world’s first metaverse customer happiness service centre in the health segment. Investing in healthtech is a global priority as it brings significant value for user and customer experience, encouraging citizens to look after their health. Further to the significance of Dubai’s entry into Sandbox reflecting the country’s role in facilitating a borderless market enabling sustainable economic freedom, it is now clear that the country can certainly benefit from being an early adopter of metaverse technology. In addition, through the several investments and initiatives the country has already taken, Dubai could possibly become a role model for other governments and corporations around the world in this regard.