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The Economic Implications of Services in the Metaverse

In: Global Perspectives in the Metaverse

Author

Listed:
  • Carlos Cantú

    (Bank for International Settlements (BIS))

  • Cecilia Franco

    (Bank for International Settlements (BIS))

  • Jon Frost

    (Bank for International Settlements (BIS)
    Cambridge Centre for Alternative Finance)

Abstract

How could an immersive computer-generated environment (“the metaverse”) impact services in the digital economy? Investment in virtual worlds has grown rapidly. Yet the technology still falls short of achieving fully immersive experiences. And despite hyperbolic predictions, various indicators show interest has fallen in the last two years. While some use cases show promise (e.g. gaming, education, healthcare), others seem distinctly gimmicky (e.g. virtual bank branches, land speculation). If the metaverse does succeed, it could mean: (i) a blurring of lines between the tradeable and non-tradeable sectors, (ii) greater cross-border economic integration and (iii) new demands on payment services. In principle, retail fast payment systems, retail central bank digital currencies or tokenised deposits could be designed to support services in the metaverse. To prevent virtual environments and money from becoming fragmented and dominated by powerful private firms, public policy would need to support efficient, interoperable payments and provide clear standards on data privacy, digital ownership and consumer protection.

Suggested Citation

  • Carlos Cantú & Cecilia Franco & Jon Frost, 2024. "The Economic Implications of Services in the Metaverse," Springer Books, in: Hung-Yi Chen & Pawee Jenweeranon & Nafis Alam (ed.), Global Perspectives in the Metaverse, chapter 0, pages 83-118, Springer.
    • Handle: RePEc:spr:sprchp:978-3-031-54802-4_6
    DOI: 10.1007/978-3-031-54802-4_6
    as

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    References listed on IDEAS

    as
    1. Carlos Cantú & Gong Cheng & Sebastian Doerr & Jon Frost & Leonardo Gambacorta, 2020. "On health and privacy: technology to combat the pandemic," BIS Bulletins 17, Bank for International Settlements.
    2. Patrycja Klimas & Wojciech Czakon, 2022. "Gaming innovation ecosystem: actors, roles and co-innovation processes," Review of Managerial Science, Springer, vol. 16(7), pages 2213-2259, October.
    3. Vidal-Tomás, David, 2022. "The new crypto niche: NFTs, play-to-earn, and metaverse tokens," Finance Research Letters, Elsevier, vol. 47(PB).
    4. Janeway,William H., 2018. "Doing Capitalism in the Innovation Economy," Cambridge Books, Cambridge University Press, number 9781108471275, September.
    5. Anneke Kosse & Marc Glowka & Ilaria Mattei & Tara Rice, 2023. "Will the real stablecoin please stand up?," BIS Papers, Bank for International Settlements, number 141.
    6. Briola, Antonio & Vidal-Tomás, David & Wang, Yuanrong & Aste, Tomaso, 2023. "Anatomy of a Stablecoin’s failure: The Terra-Luna case," Finance Research Letters, Elsevier, vol. 51(C).
    7. Paul P. Momtaz, 2022. "Some Very Simple Economics of Web3 and the Metaverse," FinTech, MDPI, vol. 1(3), pages 1-10, July.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Metaverse; Digital economy; Services; Payment services; Education; Healthcare;
    All these keywords.

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • I19 - Health, Education, and Welfare - - Health - - - Other
    • I29 - Health, Education, and Welfare - - Education - - - Other
    • L8 - Industrial Organization - - Industry Studies: Services
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O36 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Open Innovation

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