JP Morgan, the largest US bank, has opened the Onyx lounge in Decentraland, making it the first lender in the metaverse. The virtual lounge is the bank’s first foray into the virtual world.
Oynx is the name of JP Morgan’s permissible Ethereum-based services. The virtual lounge bears the same name, and it allows institutions and businesses to access the metaverse.
The financial behemoth has released reports on cryptocurrencies’ general acceptance. The latest report from JP Morgan provides insight into the metaverse and integrated commerce applications opportunities. Electronics and fashion businesses have entered the world of digital real estate and metaverse parties, offering customers digital collectibles and experiences.
JP Morgan is exploring opportunities in the Metaverse
“There is a lot of client interest to learn more about the metaverse,” Christine Moy, JPMorgan’s head of crypto and the metaverse, stated in an email. “We put together our white paper to help clients cut through the noise and highlight what the current reality is, and what needs to be built next in technology, commercial infrastructure, privacy/identity, and workforce, in order to maximize the full potential of our lives in the metaverse.”
They wrote in their metaverse report:
“One of the great possibilities of the metaverse is that it will massively expand access to the marketplace for consumers from emerging and frontier economies.”
JPMorgan starts its analysis of “metanomics” by noting that the average price of a virtual plot of land increased in the second half of 2021, rising from $6,000 in June to $12,000 in December across the four major Web 3 metaverse sites: Decentraland, The Sandbox, Somnium Space, and Cryptovoxels.
According to the JPMorgan analysis, “in time, the virtual real estate market might see services similar to those found in the actual world,” such as credit, mortgages, and rental agreements. It went on to say that decentralized finance (DeFi) collateral management might play a role and that this could be handled by decentralized autonomous organizations rather than traditional finance businesses (DAO).
The metaverse’s components continue to change at a breakneck pace. It’s challenging to build a corporate strategy around such a dynamic environment characterized by rapid development and new entrant innovation.
The costs and risks of engaging early and regularly to generate internal intellectual property, establish ideas about future business models, and discover ecosystem partners and collaborators, on the other hand, are pretty minimal. The asymmetrical risk of being left behind justifies the small initial expenditure required to get started and explore this new digital terrain.