123 Blockchain: Post #2 (Part 1)

Layer 1:

How Miller Lite Entered the Metaverse

This past NFL Super Bowl had a lot of crypto advertisements going on, but one overlooked aspect took place off-screen. In fact, a beer company, Miller Lite, hosted an event in Decentraland where users gathered to watch the game, earn avatar wearables, and receive a proof-of-attendance token. Their virtual tavern was quite impressive, and it demonstrated how well-known brands are entering Web 3.0 ecosystem. This feat, though, was only made possible through a third-party metaverse development company, TerraZero. Fundamentally, TerraZero is a representation of an entirely new line of services (Metaverse-to-Business). The funny thing is, it appears their lease is up because the property is now vacant.

Layer 2:

Meet TerraZero

By tracing the land coordinates of Miller Lite’s tavern (44, -42) to Decentraland’s open marketplace, it was revealed that they did not actually own the property – they leased the land through a metaverse development company known as TerraZero. TerraZero’s focus really summarizes how they view blockchain technologies and the metaverse by stating, “This new paradigm must not be controlled or influenced by single corporations or governments, but instead be governed by its users. Blockchain technology enables this decentralization, and cryptocurrency enables commerce within the Metaverse as more platforms move in a decentralized direction.” They offer three primary lines of business: events, marketing, and prefabricated buildings. Along with an HQ located in Decentraland, TerraZero also provides white-glove brokerage services, asset construction (3D infrastructure & NFTs), and a suite of data analytic tools. As noted in the Level 1 understanding, it appears that the same coordinates that provided Miller Lite’s experience are now vacant. The technical sophistication required by Miller Lite only relies on their abilities to track consumer behaviors while creating experiences that leave life-long connections.

It should also be noted that other brands have joined in on the fun. Heineken, another beer company, is trotting a similar path to Miller Lite. Following the same pattern relayed above, Heineken does not own their metaverse property but entered Decentraland through a metaverse development company known as Admix. By jumping into Decentraland, their coordinates of (-123, -81) are owned by an unspecified wallet address, but can be traced to an OpenSea account and a subsequent social media page. Heineken, in contradiction to Miller Lite, is seeing the metaverse as an opportunity to make this movement a cultural meme. Bram Westenbrink, Heineken's global head of branding, stated that “We know that the metaverse brings people together in a light-hearted and immersive way but it's just not the best place to taste a new beer…. Our new virtual beer is an ironic joke. It is a self-aware idea that pokes fun at us and many other brands that are jumping into the metaverse with products that are best enjoyed in the real world.” As an important reminder, innovative movements often start off as a joke. Amazon selling books online and Bill Gates trying to explain the internet are outstanding reminders that new technologies and trends start small but grow exponentially.

Layer 3:

What Do Metaverse Development Companies Automate?

Large corporations no longer have to have a specialized team of blockchain developers, 3D animators, or social engineers to understand all of the nuances to enter the metaverse. The requirements below, though not exhaustive, illustrate a few of the steps both Miller Lite and Heineken would have had to undergo to enter a Web 3.0 based metaverse:

1. Have coordinated internal meetings about the campaign, its strategic direction/purpose, and obtained approvals from key stakeholders
2. Create a cryptocurrency wallet that is either self-custodied or overseen by a third-party
   1. This would then lead to discussions of IT security, the decision process of approving transactions (ideally multisig), and what networks transactions would be facilitated through
3. Acquire Decentraland’s native currency ($MANA)
   1. Note: The company could have also converted another cryptocurrency to $MANA through a decentralized or centralized exchange
      1. This also implies that the cryptocurrency is now placed on the company’s Balance Sheet
4. Strategically purchase a plot of land from a third-party digital asset marketplace (OpenSea or Decentraland)
   1. Note: NFTs are recognized as intangible assets and their accounting treatment must be considered
5. Consider the implications of being a landholder in Decentraland, thus granting them voting power in Decentraland’s DAO to make decisions about the long-term longevity of Decentraland
6. Hire and/or train a team of 3D developers to construct the building, object animations, and wearables
   1. Decentraland is heavily reliant on the software Blender. This could also be another external risk to consider
7. Submit the avatar wearables to Decentraland’s DAO for approval
   1. After approval, the wearable is then paid for and then minted to the blockchain utilizing $MANA. This process ranges anywhere from two days to several weeks
8. Create a Proof of Attendance Protocol (POAP) digital badge for users
   1. This was one of the current offerings within the overall experience
9. Create a social media campaign to raise awareness of their event, answer media requests for commentary, and understand the lingo of Web 3.0 Twitter/Discord

Again, the list above is by no means exhaustive, but in a space where there are so many moving parts, metaverse development companies do nearly all of the heavy lifting. From an accounting, consulting, and assurance perspective, this is precisely where RSM stands to benefit from increasing its knowledge about Web 3.0 and the blockchain ecosystem. Both retail and institutional investors alike are increasingly becoming aware of what they stand to lose by disregarding this technological innovation. Oftentimes, though, the beginning is the toughest part, and being a First Choice Advisor can only be realized by learning ourselves first.