Some metaverse critics point to the significant drop in the NFT market and giant tech companies such as Facebook and Microsoft scaling back their metaverse investments as evidence that the metaverse ambition is overhyped and destined to fail.

While it is true that between 2021 and 2022 VC funding for metaverse projects saw a massive decline, likely caused by the crypto market meltdown, there is no doubt whatsoever that the metaverse is still a part of a unique slew of futuristic technologies whose long-term potentials continue to attract investors.

The metaverse's potential to create a richly immersive digital experience, fostering a more interconnected world, is anything but dead. The 2024 crypto market's recovery offers a tailwind and the metaverse's long-term success still hinges on its ability to overcome technical hurdles and user adoption.

Any technology that is designed to push the boundaries of real-world socializing is bound to hit critical mass simply because in the last two decades, technology dependence rate has increased significantly, forming the basis of human interaction and fueling the emergence of revolutionary technologies such as AI , VR, AR, etc.

With the metaverse, a VR-based technology, on the horizon, the human digital experience is bound to not only undergo a rebranding but also replace the existing infrastructure on which our digital world is built, stretching it beyond social media. Because the metaverse promises a diverse digital world with endless possibilities, it quickly gained the world’s attention and reached its fever pitch in 2021 with Facebook announcing that it had changed its company name to Meta.

The Facebook name change was a defining moment in the development of the metaverse as its main competitors  such as Google and Microsoft also took the initiative to launch their own metaverse projects, promising to usher in a future where we can work, play, and conduct business activities in an immersive 3-D environment.

The concept of the metaverse being very much attached to crypto space means that it is susceptible to the prevailing market sentiments. For example, despite the decline witnessed in 2022, data from DappRadar showed that venture capital firms invested $707 million into metaverse projects in the first half of 2023.

However, violent bear markets can also take a significant toll on the development of the metaverse as happened in 2022 when funding for the metaverse space fell sharply by 87% from its exuberant peak of 2021, signaling a huge drop in investors confidence.

Around this time, Facebook’s metaverse projects dubbed “Horizon Worlds’’ was facing challenges with reports suggesting low-user engagement and technological setbacks, contributing to the overall decline in investor confidence for metaverse projects throughout the year 2022.

Although, the broader crypto winter and technological hurdles likely played a larger role, some critics believed that the Metaverse dream died with Facebook splurging billions of dollars on its a project that failed to yield any tangible results.

Speaking to the UK Guardian, Rachel Foster Jones, a thematic analyst, criticized Facebook’s Horizon Worlds: “The cost of Mark Zuckerberg’s metaverse ambition is clearer than ever. Meta has put its entire business on the line for the metaverse, which still doesn’t exist, and the gamble is not paying off. Meta has been too busy attempting to push the metaverse that it has run its core ad business into the ground, and a string of poor results has taken its toll on investor confidence”.

With the crypto market experiencing a rebound, fueled by significant milestones such as the approval of the Bitcoin ETFs, there is now a clear indication that the metaverse hype has finally died down. Although challenges still remain, the crypto industry has grown more resilient and tighter regulatory oversight is helping to build a more complaint ecosystem for potential investors.

In retrospect, the hype was worth it and the enduring potential of the metaverse implied that a decline in funding is nothing but a temporary setback. Nowhere is this more evident than in the fact that the metaverse is entering a more realistic growth phase today.  With the initial excitement being over, the focus has shifted to building its infrastructure and overcoming its real world challenges.

According to the Digital Watch Observatory’s 2024 prediction: “The evolution of the metaverse stands at the intersection of technology and human imagination. Projections for 2024 indicate a potential leap forward, albeit rooted in ongoing advancements in AI, but also in developing high-quality chips that will give much-needed computing power. Our bet is still on the long-term success of metaverse. After the initial hype, practical applications will mark the years to come”.

CIZ VERSE As a Case Study

To further illustrate the evolving dynamics of the metaverse and its intersection with emerging technologies such as AI and blockchain , we shall take a cursory look at CIZ VERSE, an open source metaverse project geared towards the launch of the first Bitcoin-powered metaverse.

At the heart of this project is a decentralized metaverse layer that blends blockchain technology with AI functionality to enhance asset creation from its repository of multimedia, including images and video.

CIZ Verse leveraging AI exemplifies the practical applications which the Digital Watch Observatory predicted ‘’will mark the years to come’’ in the development of the metaverse, especially as it seeks to create a sprawling virtual environment replete with user-generated AI content capable of extending the capabilities of the Bitcoin ecosystem.

In addition, its decentralization model will enable it to operate as an open platform where users can create, meet, interact, and transact and its blend of business and pleasure, enables it to combine commerce with mini-games, hangouts, and social features. Lastly, as a Bitcoin-powered metaverse,  it primarily targets a broad range of users, including Web3 natives, gamers, developers, and metaverse fans and as its open world evolves and user-generated content grows, it is bound to cater to a host of use cases and features, including NFTs, RWAs, and DeFi.

Conclusion

The metaverse in 2024 presents a picture of a renewed focus on its development both within and outside the crypto space. The initial frenzy surrounding it has gradually been replaced by a new approach dedicated to overcoming technical hurdles and building a solid foundation.