JPMorgan Chase has become the first U.S. bank to jump into the metaverse. The country's largest bank announced that it has officially opened an outlet lounge inside the virtual world of Decentraland, a virtual world online that was created based on blockchain technology.
Inside its virtual office, which the bank has called its Onyx Lounge, customers can avail of its Ethereum-based services. The bank released a paper detailing its virtual space, adding that it sees a plethora of business opportunities in operating in the metaverse.
JPMorgan's head of crypto and the metaverse, Christine Moy, said they created the virtual space in response to the growing customer interest in learning more about the metaverse. She said the bank had created a white paper for clients to help learn more about the metaverse without the unnecessary "noise" related to the new technology. Moy said there is a lot of potential to improve the lives of customers within the virtual space.
The metaverse is a virtual world that acts as a catch-all for all emerging online technologies such as virtual meetings, online commerce, immersive gaming, and digital currency. There are currently three major Web3 metaverse worlds that are gaining traction, namely Decentraland, The Sandbox, Somnium Space, and Cryptovoxels.
Apart from JPMorgan, other companies and institutions have also delved into the metaverse by creating their own virtual spaces and outlets. In January, South Korean electronics company Samsung announced the opening of its store in Decentraland. The store was a virtual replica of its flagship store in New York. Last year, Barbados opened the first embassy inside Decentraland.
In its whitepaper, JPMorgan pointed out that the average price for a parcel of land within the virtual worlds are rapidly increasing. Costs for virtual real estate nearly doubled in the second half of last year, jumping from an average price of $6,000 in June to $12,000 in December.
JPMorgan said business activities within the virtual worlds, including virtual real estate, could soon mirror that of those in the physical world. The bank said rental agreements, mortgages, and credit could become a reality within the virtual worlds in the near future.
The bank said engaging in business in the metaverse would be profitable, citing a variety of entertainment providers as well as applications like RTFKT, a virtual shoe designer recently bought by Nike. Another significant investment will most likely be in advertising, which the bank estimates could be worth more than $18.41 billion by 2027.
