The illusion of the metaverse and meta-economy

David Vidal-Tomás

International Review of Financial Analysis, 2023, vol. 86, issue C

Abstract: This paper provides (i) a review of the existing literature on the metaverse and (ii) an empirical assessment of the current state of the Web3 meta-economy, with the focus on economic governance and metaverse commerce. We have analysed the entire Web3 metaverse niche, i.e. both the 196 available metaverse fungible tokens and all the non-fungible token (NFT) transactions belonging to the metaverse marketplace. Our results showed that economic governance is based on metaverse tokens that cannot be defined as reliable virtual currencies due to their explosive behaviour, negative performance, and higher volatility compared to traditional alternatives. Paradoxically, fiat currencies and stablecoins could be more appropriate candidates for the payment infrastructure. Moreover, we also observed that NFT prices are affected by the cryptocurrency market, which highlights the risk of metaverse commerce. For future research, developers and scholars must assess the different alternatives and infrastructures that can make the metaverse a persistent reality with a proper virtual economy. However, at present, it seems that the hype has run far ahead of reality.

Keywords: Metaverse; Metaverse economy; Meta-economy; Digital economy; Non-fungible token; Cryptocurrency (search for similar items in EconPapers)
JEL-codes: G10 G40 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:86:y:2023:i:c:s1057521923000765

DOI: 10.1016/j.irfa.2023.102560

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