The metaverse is a term which applies to the broad range of technologies that aim to merge the social connections of the real world with the innovations of the digital age. Where this blend occurs with traditional companies such as Snapchat’s augmented reality filters, the proliferation of social media apps on our mobile devices, or giant multiplayer gaming worlds such as Fortnite, this is considered to be the web2.0 metaverse. Meanwhile, where the metaverse has decentralized ownership and control, this is known as the web3.0 metaverse.

The phrase “metaverse” was first coined in Neal Stephenson’s 1992 novel Snow Crash. The book describes a world where governments have been replaced by corporations, the global economy has collapsed, and citizens escape from this bleak reality by accessing a virtual world through headsets. Here, their avatars can roam the digital street, own a virtual property and socialize with others.

This dystopian future isn’t the backdrop for the growth of the metaverse in our world. Instead, it has evolved through the increase in digitalization and emergence of new technologies, with the introduction of the web3.0 metaverse coming in the wake of multiple cryptoasset and blockchain innovations.

An online survey of 100 Elliptic customers and crypto and finance professionals – carried out in May 2022 – found that at least 58% of respondents expected the metaverse to deliver some commercial opportunity for their business within the next five years. This suggests significant potential for involvement from both crypto-native and more traditional financial institutions.

Tellingly, at least 66% of respondents are already in the process of, or have an intention to assess their risk of metaverse-related fincrime vectors, many of which we will outline in our typologies section.