If you look closely at the core values of Web3 and Metaverse, both technologies are user-oriented. On the one hand, Web3 platforms focuses on removing censorship on financial access for people with all backgrounds; Metaverse technology focuses on providing a more immersive virtual user experience. The features, including decentralisation, consensus mechanism, and facility of complete control over one’s data, make these technologies a perfect fit for a futuristic banking system. In this article, we will explore how Web3 and Metaverse technology can influence existing financial institutions.
Potential Applications Of Web3 And Metaverse In Banks
Monetised Gaming World
Online games are the best platform to introduce the functionalities of Metaverse and Web3. In fact, many gaming sites are already using Web3 coins and the 3D virtual world of Metaverse to make the games much more immersive as well as rewarding. Here, banks can make the most of this recent shift in gaming culture by integrating payment systems with 3D games.
In fact, one of the new-age banks or neo banks, has announced establishing an exchange system to enable value exchange from online to the real world. The bank will hold the game tokens and offer players a loan and play with digital tokens. Note that the gamification of banks is not a new concept; in fact, the idea has been floating around for many years. A few of them have even seen success.
One example is ZELF, a New York-based neo-bank. ZELF has its banking integration with one of the widely used social messengers, Discord, which is also a popular gamers’ chat server. The banking integration enables gamers to perform their banking tasks within the Discord server. They can interact via Always-On messenger and can soon trade virtual items such as in-game weapons, skins, cosmetics etc. Performing these types of trading is available via real money. Soon gamers will be able to use the ZELF MetaPass card directly from Discord.
Tokenisation On Assets/Bonds And Securities
As per the Web3 expert group, tokenisation of bonds, assets, and security provides the following advantages:
- Banks will be able to curate bonds and securities based on customers’ requirements within a short time.
- Asset trading will get more convenient with the introduction of fungible tokens.
- It will be easier to check provenance and ownership with accuracy.
- No need for intermediaries due to smart contract-enabled auto-trading
Launch Of Government-Supported Digital Currencies
There have been a few initiatives regarding the creation of digital currencies backed by central banks on a global level. Australia has come forward to explore the possible economic advantages of launching CBDC. The Reserve Bank of Australia is all set to start a project that will see how CBDC can offer efficient and value-added fund transfer and payment methods for businesses and homes.
Additionally, In India, RBI is supporting the launch of CBDC (Central Bank Digital Currency) for the coming year. Moreover, the Indian government is planning to launch CBDC in FY23. As per the Financial Act 2022, CBDC will have the same value as the fiat currency of the country. Furthermore, many reputed Indian banks will be the participants in such a historical change in the Indian economy.
Aside from this, over 100 nations are supporting the CBDC launch to see its effects on their economic status. Some of these countries even include 19 G20 nations. You can take Web3 platforms classes to learn how impactful the introduction of CBDC and other cryptos in the mainstream world will be.
After the pandemic, the world has gone digital. Almost all kinds of services and essential tasks, including office work and education, take place online. This change has brought convenience to people during lockdowns. However, there are many other reasons than the pandemic that push the idea of the development of a virtual world with no location barrier to get the work done. For example, there is a lack of proper infrastructure for education and banking in many regions. Globally, there are up to 7% of people have no formal banking account or related profile due to the unavailability of proper services and establishments.
On the one hand, Metaverse technology brings the capability to visit banks virtually while sitting in your comfort place. With Metaverse, users can create their online custom avatar to visit the 3D virtual world of the Metaverse, including virtual bank branches, interact with the staff, initiate transactions etc. On the other hand, Web3 makes it possible for each user, irrespective of their location or financial background, to leverage desired financial services offered by liquidity pools.
Investment banks can create their own liquidity pools and enable users to borrow required loan amounts. The presence of Smart Contacts will ensure the borrower is eligible for the lending and automatically process the transaction.
Immersive Customers Service
Metaverse makes the user experience highly immersive by imitating the real world around them. One can do all kinds of activities, including meeting and conversing with people they want virtually in almost a real-life setting. Thus, banks can take their customer service to the next level with Metaverse by allowing them to be involved in one-on-one conversations with financial advisors. Further, banks can enable critical facilities like financial reviews, mortgage advice delivery, financial planning, annual portfolio reviews and many more virtually. It can transform banking customer service.
The article discusses only a few applications of Metaverse and Web3 platforms in the banking sector. With time and more development in these technologies, there will be more practical use cases that will bring convenience to both customers and banking staff. However, before the implementation of these technologies, proper Web3 platforms, as well as Metaverse training, is necessary for organisations.
Right now, there is a lack of professionals in Metaverse and Web3. Thus the demand for knowledgeable candidates is high. It is the right time you take Web3 expert certification classes and Metaverse training to become part of the developer community.
Blockchain Council enables you to get high-quality certification programs and embark on a successful journey in the field of these futuristic technologies. Make sure to check out all the available courses.