Examining the Use of Non-fungible Tokens (NFTs) as a Trading Mechanism for the Metaverse

Abstract

The notion of a metaverse seems hard to define but encourages the impression that it can be considered as a new virtual metaphysical landscape that somehow goes beyond our geographical locations and understanding (i.e., independent of time and space). Based on virtual reality, augmented reality, and blockchain, it is envisioned as an independent but extended world that is planned to be a digital virtuality entrenched not only in our old habits such as gaming and entertainment but also in virtual asset trade. In particular, trading is a pillar of the virtual economy, and auction houses will be crucial for Metaverse trading. This exploratory study examines the possibility of using an auction environment to improve the trading capabilities in a virtual universe. We investigate the cases of creating a virtual auction house with the potential of social trading of virtual assets with crypto coins and bartering. To this end, we built a virtual auction house and tested it initially using a set of scenarios. Our preliminary findings suggest that creating a virtual trading environment would be beneficial as an environment for buying and selling virtual assets and exploring their consequences.

Blockchain paradigm in the metaverse

“…of a physical asset (Yilmaz et al, 2022), NFT reinforces security in asset management in the metaverse due to its unique character and its inability to be exchanged by others (Buchholz et al, 2022;Y. Huang et al, 2023) In addition, NFTs open new doors to creativity and training in the metaverse (García R et al, 2023) "Digital artists have found in NFTs a platform to display and market their art in virtual galleries, allowing buyers to transparently follow copyright and associated terms of use."…”

“…These units of value have the versatility to represent both physical and digital assets on the blockchain (Song & Qin, 2022). Whether it is a currency, a digital good, or even ownership of a physical asset, tokens enable a unique and transferable representation of value in the digital space (Ritterbusch & Teichmann, 2023;Yilmaz et al, 2022). This feature is integrated into various applications, from creating digital currencies to tokenizing real-world assets.…”

“…In short, NFTs and the Metaverse are experiencing an exciting symbiosis that promises a future full of opportunities. NFTs not only act as strong proof of ownership but also play an essential role in creativity, entertainment and authentication in this exciting new and ever-expanding digital environment (Yilmaz et al, 2022).…”

Research on Metaverse Security and Forensics

“…References [59,60] discussed the application of NFT in the metaverse from an economic point of view, and pointed out the importance of metaverse forensics. References [61,62] studied the possibility of using machine learning for metaverse forensics from a technical perspective.…”

Smart Contract-based Dynamic Non-Fungible Tokens Generation System

“…Metaverse unlocked the vision of virtual reality and how physical interaction could be imitated with the help of technology. Some prime examples include Fortnite's virtual concert featuring Marshmello and Lil Nas X's performance in Roblox [14].…”