Five Ways the Metaverse Will Improve Your Life

It´s not sci-fi, and it´s not that far

This thing that we call the Metaverse sounds such sci-fi stuff.

People with 3D glasses playing games or going to virtual concerts, right?

It is that, of course, but not only that.

In fact, this is only a tiny part of it.

Yes, the Metaverse is the digital world in which we will go to concerts and meet new people, but also work, start companies and earn money.

We will do almost everything we do in “real” life on this immersive Internet.

This is awkward and maybe frightening for some people, like living in the Matrix.

For others (like me), it is a unique opportunity for a fresh start in many things.

The way we organize our social interactions, the way we exchange things, the way we cooperate, etc.

In short: how we organize society.

This will be a time of innovation and experimentation, and it will arrive so fast that it will be shocking.

A new frontier is opening for us to try new and better ways to do many things.

And the new options are going to impact and better our lives.

These are, in my opinion, the five most significant changes.

1. Political innovation

Long long ago, the way to experiment with new forms of government was to “discover” new lands.

Of course, the new land often had people living on it, but the settlers created new countries (new jurisdictions) with different rules and forms of government.

The canonical example is the USA. After the American Revolution, a new type of democracy was born, and it was possible to see how its results compared with those of the Old World.

My point is that through experimentation, it was possible to search for new forms of government, try them in practice, and compare them with others.

Like in any other area of life, experimentation leads to learning and improvement.

Nowadays, there are no more frontier lands and no more new countries that experiment with different forms of government, which means political innovation has become stagnant.

But, what would happen if we had new “countries” in the metaverse?

In that case, experimentation season will be open again.

And with it, learning and improvement.

The fact is that we are already talking about something very similar to new nations in the metaverse.

Axie Infinity, the play-to-earn game, is one of the best examples. With its own money, property rights, jobs, and even “land.”

With rules that are clear, stable, and enforced automatically.

How far can such a system go? And what can we learn from that for our “real life” countries?

The answer to those questions lies in the second point.

2. Competition between countries

As soon as these new countries begin to operate and draw a significant part of the economic activity to their domains, physical jurisdictions (countries) will also look at them as competitors.

Suppose a significant number of young people start to “work” in these digital jurisdictions and make “money” (tokens) that later can exchange for fiat money (dollars, euros, etc.).

That will mean a drain of human resources and economic activity they couldn´t ignore.

They will probably start to change their own rules to compete successfully.

There will be an option for many people: working and earning money in a traditional country or doing so in a digital nation.

Which one will be the best option?

It depends. It will depend on the rules (legal system) of one vis a vis the other.

This trend is barely beginning now, so it may sound crazy. But remember: people are already earning REAL money in digital nations (still called “games”).

The likely result, as always, is that competition will boost innovation, increase quality and reduce the price.

That is to say, better services from countries, lower taxes, and better living standards.

I know that hearing “lower taxes” makes many people scoff. It´s taboo.

But what if you get lower taxes with better services?

And, isn´t competition what drives up quality and lowers the price?

3. Better money

Let´s clarify it from the beginning: better money means no inflation.

That is, there´s no hidden way for the government to grab what you earn lawfully.

Inflation results from governments printing money to finance expenses and causes people to lose purchasing power. So it´s a hidden tax.

One that can be eliminated through competition of currencies.

In effect, just as there will be competition between countries (physical and digital), there will also be competition between currencies.

That means people will favor using those that are the most stable.

To some extent, this is happening already.

The rapid expansion of crypto is a signal of money competition. And the explosion of digital nomad visas and e-residency and similar fiscal residence programs is an example of countries’ competition.

The bottom line is: people will have more chances to use a currency of higher quality and more stability.

Again, more options, more competition, better quality.

4. Financial and macroeconomic stability

The financial system, particularly the banking system, relies on “fractional reserve requirements.”

It simply means that banks receive the money we deposit but do not keep it, except for a small percentage, but lend it to others.

So if many people want to withdraw their money simultaneously, there is not enough, and a banking crisis is born.

As you can see, the system works so that crises are always just around the corner.

A private currencies (crypto) system will most likely work together with a lending mechanism with NO fractional reserve, something more akin to investment banking.

This mechanism exists within many DeFi (decentralized finance companies) and applications.

The lender assumes the risk, WITH THEIR OWN MONEY.

In this way, the systemic risk disappears, and there is no need to bail out banks with taxpayer money.

5. Legal certainty

Finally, many of the companies that are and will be part of the Metaverse operate based on rules established as a smart contract.

This means that they are automatically applied and complied with and cannot be arbitrarily modified by anyone, no matter how many votes they have.

Such a system has stability and reliability, which our current political systems often lack.

These are forms of governance similar to those in DAOs, quasi-business organizations, based on smart contracts that do not require trust among their members.

They are very efficient organizations, in that sense, used for different purposes.

The political and economic evolution generated by the expansion of the Metaverse and activities in the digital world is much more profound than we might have thought.

Imagine what a world would be like if currency did not depreciate, property rights were respected, countries’ services were better, taxes were lower, and the financial system was robust and crisis-proof.

Such a system would grow the economy rapidly, and people’s welfare would increase at the same pace.

Is this what the future holds?

It is possible, though not sure.

In any case, we will see it soon. Very soon.