JPMorgan becomes world's first bank to arrive on metaverse

JPMorgan, the largest bank in the US, said it has become the first lender to arrive in the metaverse -- a virtual world based on blockchain technology, according to Coindesk.

JPMorgan unveiled the Onyx lounge (the name refers to the bank's suite of Ethereum-based services) and released a report exploring how businesses can find opportunities in the metaverse.

JPMorgan said that there is a lot of client interest to learn about metaverse and they are attempting to highlight what the current reality is, and what needs to be built next in technology, commercial infrastructure, privacy/identity and workforce to maximise the full potential of our lives in the metaverse, the bank told CoinDesk in an email.

In January, electronics giant Samsung opened a version of its New York store in Decentraland, and in November, Barbados established a metaverse embassy. 

JPMorgan begins its assessment of "metanomics" by pointing out that the average price of a parcel of virtual land doubled in the latter half of 2021, jumping from $6,000 in June to $12,000 by December across the four main Web 3 metaverse sites: Decentraland, The Sandbox, Somnium Space and Cryptovoxels.

"In time, the virtual real estate market could start seeing services much like the physical world, including credit, mortgages and rental agreements," said the JPMorgan report, as quoted by CoinDesk. It added that decentralised finance (DeFi), and collateral management could well come into play, and that, rather than traditional finance companies, this could be done by decentralised autonomous organisations (DAO).

Work in the metaverse will also be gainful, said the JP Morgan report which CoinDesk cites, pointing to a range of entertainment providers, as well as apps like RTFKT, a virtual shoe designer recently acquired by Nike.

The JPMorgan paper attempted to illustrate the metaverse hype versus the reality, stating that many areas need to improve. These include the overall user experience and performance of avatars, as well as commercial infrastructure.