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Blockchain For Virtual Reality: 12 Possible Use Cases

  • 3 December 2018
  • Sam Mire

In order to fulfill projections that virtual reality could overtake television in terms of popularity as soon as 2025, some significant challenges must be overcome. The infrastructure and gear required to create and access virtual reality content can easily reach over $1,000, and reducing this price point will be critical if widespread adoption of the technology is to be achieved. With an estimated economic impact of $15.6 billion by 2020, it’s one of those technologies that has massive potential if investors and users are willing to remain patient for kinks and logistics to be worked out. As of now, those kinks range beyond the cost of VR equipment. Platforms for VR marketplaces remain highly theoretical, and while they hold promise, it will likely take a unifying, interoperable system to link VR creators and consumers if the technology’s potential is to become a reality.

Perhaps unsurprisingly, there are some ways that the blockchain will help along VR’s evolution. Tokenizing VR creator content through cryptocurrencies will help incentivize a meritocratic system by which the most diligent, creative VR content rises to the top. And as the content becomes more sophisticated, more affordable to create, and reasonable to access, users could have a means to pay directly for content and access it — whether it is a gaming experience or live experience, such as a concert — utilizing the same technology: blockchain.

Blockchain for virtual reality - Possible use cases

Live Experience Marketplaces

Blockchain use cases in virtual reality - Live Experience Marketplaces

Some of the discussions that inevitably emerge when weighing the extreme limits of virtual reality eventually begin to cross into science fiction territory. This may seemingly be the case with live experience marketplaces, where users can pay to access experiences that, when paired with VR technology, come eerily close to the real thing. Consider that some of the most lucrative, in-demand live events could plausibly be tailored to VR technology to provide a wider audience access to events in a way that is more realistic than television and more affordable than attending in person.

This could be of great service, considering the cost of so many live events. Tickets to the 2019 Super Bowl in Atlanta are currently starting at $3,824 on ticket site SeatGeek. Some of the worst seats in the house are going for as much as $5,300. According to TickPick, Korean boy band BTS is commanding an astounding average ticket price of $478. The Eagles were the next hottest ticket on the 2018 concert circuit, with fans paying an average of $238 for a ticket. Ed Sheeran racked up an average price of $228 for each fan attending his concerts. These prices are simply unreasonable for people not willing to rack up debt or blow their monthly leisure budget in one night.

Fortunately, services are emerging that aim to offer the ability to transport somebody to their favorite concert or sporting event simply by paying a fee and strapping on their headset. Some of the most prominent startups have integrated blockchain technology since their beginnings, primarily as a form of currency by which users can pay for these experiences, and other uses for the blockchain in these marketplaces may soon emerge. 

Companies Trying to Solve This Problem

  • Ceek – Live VR events with an ERC20 token. 

Monetization for Content Creation

Blockchain use cases in virtual reality - Monetization for Content Creation

The money that gamers are willing to spend both on games themselves and on in-game assets makes it apparent how much opportunity lies in monetized VR applications. No game illustrates the universal grip that can take hold when a game’s popularity takes on a global appeal more so than Fortnite. Roughly 78.3 million people played Fortnite in August 2018. A reported 69% of those players were likely to have spent money on the game, with an average of $85 spent per player. That amounts to nearly $4.6 billion spent on a single game, and it should be considered that this is a game that is technically free.

The recently released Western game Red Dead Redemption 2 also illustrates gamers’ willingness to shell out for cutting-edge gameplay. More than 17 million copies were sold in eight days, with $725 million earned in the first three days after its release. If game developers are able to harness the power of virtual reality to tap into the massive gaming market, they may be able to replicate these massive sales figures and also allow gamers themselves to profit from their own original creations.

Gaming startups are exploring the merits of incorporating blockchain technology so that gamers can seamlessly create and exchange content using a single form of currency. The global reach of many games begs a universal tender by which any user can exchange real assets for digital ones. As the creation of VR experiences becomes a more mainstream phenomenon in the gaming community, the blockchain could underpin these digital marketplaces. 

Companies Trying to Solve This Problem

  • Vibe  Creating a hub for content monetization. 

Virtual Commerce

Blockchain use cases in virutal reality - Virtual eCommerce

One of the pitfalls of e-commerce is the inability for customers to fully envision how a dress will fit them, the actual size of an ottoman, the way that a banana hammock suits their figure, etc. Despite this, e-commerce is thriving. Consumers spent $453.46 billion with online retailers in 2017, which represented a 16% increase in sales over the previous year. By 2021, e-commerce retail sales are expected to make up 17.5% of all global retail expenditures.

Despite these encouraging figures, many online retailers still aren’t taking full advantage of the technology that could be boosting their sales figures. The power of imagery in marketing and retail is well established. Including a photograph and video in a press release increases the number of views by 45%, according to one measure. According to Google, roughly 50% of consumers look for videos about a product online before they order it or visit a store to purchase the item. One can imagine the impact that more immersive, three-dimensional methods of displaying a product would have on e-commerce sales.

Online retailers, especially in the fashion industry, are toying with utilizing the VR experience to give their customers a greater sense of what an item looks like without having to travel to a physical location. The blockchain has emerged as a reliable, interoperable means of establishing and storing copyrights for these digital creations. As more industries and customers come to embrace VR, these rights will become increasingly important to protect. 

Companies Trying to Solve This Problem

STEM Training and Experimentation

Blockchain use cases in virtual reality - STEM Training and Experimentation

STEM is officially cool again. Science, technology, engineering, and math have always been fields where there are steady jobs to be had and money to be made, but they’ve never been the sexiest of fields. With overpriced liberal arts degrees and the proliferation of insurmountable student debt, STEM is back in a major way.

In 2016, New York State had the largest increase in STEM degrees, with a 45% uptick in the number of students attaining a certification in science, technology, engineering, or math. California, the largest producer of degrees in the nation, experienced a 36% uptick, while the number of humanities degrees dropped by 3%. This is a positive trend, considering that the U.S. Bureau of Labor Statistics has stated that 15 of the 20 fastest growing fields will require substantial math and science preparation. Several charter schools are helping students discover their affinities for the STEM fields at earlier ages, but these fields also present some unique challenges at the undergraduate, graduate, and professional levels.

STEM tends to encompass some of the professions where practice is difficult to implement. In the science, technology, engineering, and math professions, there is often little recourse for replicating the real thing. Whether it is a scientist working in the field or a medical professional attempting to learn about a surgery, reading books only goes so far.

The importance of the STEM fields explains why startups are making simulation for these STEM professions a priority. If a surgeon had a 360-degree simulator of a bypass surgery, for example, they could use this VR program as yet another way to get ready for the real thing. The more preparation in these high-stress fields the better, and the blockchain can serve as a hub for the secure sale of these valuable programs. 

Companies Trying to Solve This Problem

In-Game Advertising Attribution

Blockchain use cases in virtual reality - In-Game Advertising Attribution

Advertising and the modern gaming landscape are inextricably linked. Even popular games that do not incorporate product placement or other forms of advertising into the game itself rely heavily on advertisements to garner interest. Several of the wildly popular games tailored for mobile platforms are even more dependent on advertisement as a source of revenue. An estimated 10% to 30% of revenues for social games are the result of advertising, and figures show us that the most successful games incorporate advertising of some sort; clearly, gamers have, by and large, accepted ads as a fact of life.

In fact, 78% of the 50 highest-grossing gaming apps in the U.S. in 2017 featured advertisements — in 2016, that number was only 45%. The increase in ads has been an absolute windfall for game developers, who were projected to generate $39.8 billion in global ad revenue in 2017. As VR gaming gains traction, similar advertising models are likely to arise, but more creative twists are going to be necessary to deliver advertisers the sort of interaction that is reflective of VR technology’s unique capabilities.

As is the case with any industry, tracking the effectiveness of ad campaigns in virtual worlds is the first step in gauging how well advertising dollars are being spent. Blockchain-linked coins have been developed that allow users to interact with advertisements as they explore virtual worlds, and the effectiveness of these advertisements are measured through, among other metrics, the tracking of eye movements to measure the attention each ad commands. Compensating users with coins for interacting with these ads and logging information about their interactions on a blockchain ledger are two ways that blockchain tech will impact the advertising landscape in the worlds of virtual reality.

Companies Trying to Solve This Problem

  • GazeCoin Blockchain based ad performance, coupled with eye movement tracking. 

More Secure Virtual Worlds

Blockchain use cases in virtual reality - Securing Virtual Worlds

The worlds of virtual reality are creating a new class of collectibles, and they aren’t necessarily ones you can see with the naked eye alone. When German-Danish artist Christian Lemmerz made available his piece of virtual reality artwork, “La Apparizione” (The Apparition), in 2017, he released five unique editions listed for $100,000 apiece. This price surely seemed lofty for those who saw La Apparizione as mere software, but the experience of viewing a golden, seemingly-life-like digital sculpture of Jesus on the cross, quivering and shedding golden flakes sporadically was an intriguing new opportunity.

As new iterations of VR artwork and digital worlds continue to arise, consumers may well embrace a technology for purposes — such as art — that were largely unconsidered in the past. While digital worlds utilizing VR technology will permeate sectors from live entertainment to gaming, art presents one of the examples of why VR could stand to gain from blockchain technology as a security measure. With unique VR exhibits popping up in museums and art houses, ensuring the technology remains hack-proof is vitally important.

With the rise of expensive virtual software has come the legitimate concern that these works of digital art and entertainment will be hacked, stolen, copied, and disseminated, defeating the purpose of limiting their supply. The blockchain helps verify that the copy of an item, whether it is a virtual work of art or code to a VR experience or game, is not a duplicate that has essentially lost its value because the seller has kept numerous copies for themself. This will help ensure that scarcity remains intact, and forged or stolen VR software are not peddled as if they were the real thing. The technology may also have uses such as preserving VR users’ identities and establishing item ownership in virtual worlds. 

Companies Trying to Solve This Problem

  • Decentraland – Blockchain secured, decentralized virtual world.

Visualizing Difficult Concepts

Blockchain use cases in virutal reality - Visualizing Difficult Concepts

Though our brains retain information differently from person to person, the power of visual and interactive methods of learning has been well established. An estimated 65% of the population is comprised of visual learners, and visuals are processed roughly 60,000 times faster than text by our brains. Visual aids also assist in the comprehension of material, as they can improve learning by as much as 400%. And studies are now finding that children retain information gleaned from interactive media just as well, if not better, than the facts they learn from fact-to-face instruction. As attention spans become ever-shortened, educators have become increasingly open to the idea of finding more interactive ways to prevent dozing off in class and fostering more excitement for at-home assignments.

The blockchain, when paired creatively with VR, may open up a new frontier for education. Already, platforms are being developed with the aim of providing three-dimensional educational experiences, helping to make clearer hard-to-grasp concepts, such as the blockchain itself. One can envision a time when entire curriculums are made available through blockchain-linked databases that allow members of a class to access secure, interactive course materials once their identity is verified. 

Foundation of Trust in the Metaverse

Blockchain use cases in virutal reality - Foundation of Trust in the Metaverse

The facts and figures surrounding the creation, sale, and purchase of digital assets are nothing short of astounding, especially for those who don’t consider themselves avid gamers. When one considers that a single virtual outfit for a video game character can cost as much as $500, and sometimes more, the industry’s overall sales figures don’t seem as unbelievable as they might at first glance.

Video games “skins,” the moniker given to virtual outfits, is a $50 billion industry in its own right. And the movement toward purchasing digital assets is only growing. In Australia, the sale of digital game add-ons eclipsed the revenue from the sales of games themselves two years ago. Digital sales were up 27% in 2016 to a total of $1.589 billion, while packaged games took in only $1.243 billion that year. As virtual reality becomes a more mainstream technology with several uses across industries — gaming being prominent — securing these digital worlds is a high priority.

As of now, digital worlds — metaverses, if you will — are largely ungoverned by the patents and trademarks that provide legal checks and balances to ensure that originators are credited with ownership and the rights that arise from being the architect of a digital asset. However, blockchains are in the works that will serve as proof of ownership for metadata pertaining to any given asset in the VR world, providing a measure of trust that is necessary for the purchase and sale of those assets.

VR Content Distribution Platforms

Blockchain use cases in virtual reality - Content Distribution Platforms

Content distribution platforms cross the lines of the music industry, film and television fields, and gaming marketplaces, and while largely fragmented, they are also successful in their own rights. In 2017, Spotify reported an annual revenue of $4.99 billion. In Q1 2018, that figure has remained strong, with first quarter revenues of $1.36 billion.

Hulu has experienced its own form of success as one of the industry leaders for streaming film and television. While the service is actually losing money, it is gaining subscribers, and its investment in top-notch content is thought to be an expenditure that will eventually pay off in the form of revenues and customer loyalty. Plus, it continues to haul in more than $1 billion per year in advertising revenue, an indication that content distribution marketplaces attract lots of eyeballs. In the age of the binge watcher, these marketplaces have learned how to maximize revenues without alienating their customer base. VR marketplaces should model themselves on a similar blueprint, while adopting the security and convenience measures that blockchain technology provides.

Startups are obtaining funding for blockchain-linked VR content distribution platforms that would allow users to upload and purchase VR experiences ranging from gaming software to film and television, music, and beyond. Once this platform becomes operational, the concept could serve as a single pitstop for those looking to purchase unique VR experiences at a reasonable cost, as well as those looking to profit from their original VR creations. 

Universal File Formatting

Nothing gets the pheromones pumping quite like the phrase “file formatting.” OK, admittedly, it’s not the sexiest of topics, but it’s something that regularly pops up in the lives of those who need to download files, send documents, publish their content online, etc. We’ve all seen the “file type not accepted” message, leading us into a rabbit hole of strange acronyms — .zip, .jpeg, PNG, and, on the rare occasion, even TIFF.

Snafus in the file formatting process can lead to missing data, loss of timestamps, and several other issues, many of which qualify as critical errors. Changes in technology can lead to rapid obsoletion of different file types, and keeping up with these changes is often beyond the capabilities of the layman. As VR becomes a more widely adopted means of consuming content, insulating users from file formatting differences is one goal of the technology’s makers and sellers.

Proponents of blockchain technology for use in virtual reality believe that the blockchain could standardize the fragmentation of file formatting that leads to countless “error” messages and stifles global connectivity. By establishing a single technological platform and means of transmission, it’s believed the virtual content and worlds will take on a uniformity that allows for easier sharing and universality of content, so that somebody in India has precisely the same VR experience as a consumer in California.  

Companies Trying to Solve This Problem

Creating the 3D Web

Blockchain use cases in virutal reality - Creating the 3D Web

The internet has provided a blueprint for how rapidly a novel technology can grow and multiply, and has also offered us a glimpse into what is possible if the power of a technology can be harnessed effectively. There are now nearly 4 billion users of the internet, as opposed to a mere 16 million in December of 1995. There were over 1.3 billion websites as of January 2018. But not all of this is good. China actually has treatment centers for the internet-addicted, and some believe that the web has brought out the darker side of humanity.

As the internet has arguably reached diminishing returns (unless you’re into intra-family internet squabbles and mudslinging, of course), it’s time to imagine what new technologies could do to create richer virtual experiences. One idea is the advent of a three-dimensional internet facilitated by virtual reality technology.

Imagine an internet in which users could interact with three-dimensional worlds. This would create unique marketing opportunities for retailers to bring their products to life in a way that is accessible to all internet browsers. From vehicles to clothing and beyond, the ability to provide a 3D experience has great potential both in retail and recreation, and the blockchain has the ability to secure the software behind these experiences as well as offer facets, such as online real estate registry, in a way that is immutable and assisted by smart contract technology. 

Open-Source Collaboration on Virtual Research

Blockchain use cases in virutal reality - Open-Source Collaboration on Virtual Research

The investment that both the private and public sectors put into medical research is substantial, but the current systems have not always produced the results that mankind wants or needs. Between 2013 and 2016, medical health research and development spending rose by 20.6%. And government-backed medical research spending is once again set to rise substantially. The recently passed budget calls for a 12.8% increase in medical research and development spending, which will total $176.8 billion. Despite this spending and the hard work of medical professionals in all sectors, we are well aware that, despite massive funding — and a declining death rate — potentially fatal diseases such as cancer persist. One way that the medical field is seeking to gain an advantage over the disease they help fight is by embracing cutting-edge technologies.

Several of the largest players in the science and research fields are exploring how virtual reality and augmented reality will help advance their efforts to discover new drugs and treatments. With the assistance from VR and blockchain practitioners, the medical field may soon have the ability to share information and data in a collaborative manner, using blockchain’s interoperability and security to interact remotely on the most cutting-edge forms of research.

About Sam Mire
