Fintech in the context of an innovative metaverse

Alyona Shevtsova
4 min readNov 4, 2021

The annual Facebook Connect conference, held on October 28, brought perhaps the most important innovation defining the future of the entire Internet. Mark Zuckerberg announced the rebranding of the parent company (Meta instead of Facebook Inc) and talked about his plans to create a metaverse. In this blog, I will review the new trend and analyze the role of fintech in the functioning of the virtual world.

Science fiction writer Neal Stephenson coined the term metaverse about 30 years ago, implying the stage in the evolution of the Internet into something more. This is an opportunity to create a common digital world that includes augmented and virtual reality. The purpose of such a metaverse is to create free space and a virtual refuge from problematic reality. The mechanics of the new supposed world is based on the reproduction of any human actions in the real world, which will become available after connecting to it in the form of an artificial casing — an avatar. A human playable character in the metaverse can be whoever he wants and owns anything, and death does not mean the same in the real world.

Mark Zuckerberg is positioning the new virtual world as the next step in the evolution of social interactions — open to all people of the planet. Everyone will be able to study, play online 3D games — all this goes beyond today’s possibilities. At the same time, the flagship applications Facebook, Instagram, WhatsApp will remain unchanged.

In addition to social networks and messengers, the company owns Oculus (a brand of virtual reality devices), Horizon (VR/AR-platform), Facebook Reality Labs (a company developing software solutions for virtual reality), as well as the payment system Facebook Pay, the cryptocurrency project Libra and cryptocurrency wallet Novi, which is still under development. That means that the corporation has collected almost all the necessary elements for the realization of the metaverse. Thousands of qualified engineers are already engaged to work on the project.

Meta is now ready to invest $10 billion to create the infrastructure for the new virtual universe. The company plans to unite not only all the products included in Facebook but also to add new services and formats thanks to virtual and augmented reality technologies. At this stage, it is not yet explained how the metaverse will work, but the big role of NFT crypto technology or smart contracts has already been announced.

The mention of digital currency was not coincidental, because you also have to pay in the metaverse. Cryptocurrencies allow people to send and receive money anywhere in the world instantly, safely, and without commissions. In fact, this is a huge payment network, where Libra cryptocurrency or any other coin can become a means of payment. Such actions are expected to push up the payment market and companies related to transactions in the virtual world.

Over the past century, the number of payment methods has diversified as a result of new communication technologies and the increasing number of transactions one person makes every day. For example, PayPal, Square, and Cash App now serve as the default payment method for many areas, rather than just another way to pay for goods, along with a bank card. Transfers between users of the same payment platform are actually just a redistribution of money stored within the ecosystem itself. Because of this, transactions are instantaneous, and platforms typically do not charge a fee. Payments in the metaverse could also spark a revolution in the market, as we are talking exclusively about virtual goods and digital transactions.

In theory, payment systems should be better in the virtual world than in the real world. This economics primarily involves goods that exist only virtually, and are purchased through purely digital transactions (and therefore at low cost). For the most part, they cost $5–100 each. But this economics is also big. The gaming digital goods market was worth $54 billion in 2019. By comparison, movie distribution grossed $42 billion and music stores earned $30 billion. Such payments also do not pose a systemic financial risk or play a critical role in society. That said, they involve thousands of market participants and a dozen competing platforms, which should lead to creativity, innovation, and competition in payments.

The market giants have taken the news about the metaverse seriously and are preparing to enter new virtual markets. Nike has already registered its logos and slogan in the virtual goods category. A total of 7 applications have been filed from the company to the United States Patent and Trademark Office so that no one can use the trademarks without a license. Such actions indicate that Nike is preparing to sell clothing in the metaverse.

On the day of the presentation, Facebook stock (on the NASDAQ: FB) was up by 3.5%. This is a sign of the interest of investors, shareholders, and many market participants in the metaverse. As the project develops, the payment market will also grow, expanding payment methods, increasing the speed of transactions, and reducing their cost.



Alyona Shevtsova

CEO of the international payment system LEO, the shareholder of IBOX Bank