Recently, terms and concepts such as “digital collectibles” and “the metaverse” have come into the global mainstream. These concepts are likely to become virtual-world rule-changers.

In fact, in the first few years, the digital collectibles market continued to wane in popularity. However, with the development of the whole metaverse concept, digital collectibles have rapidly developed in 2021, serving as a fundamental element of the metaverse.

What are digital collectibles and the metaverse?

As a unique form of collection in the metaverse world, digital collectibles have gradually expanded from initial artworks into various fields such as games and sports, with increasingly rich content and a more diversified ecosystem.

In this regard, at the Blockchain Connecting to the World international webinar event, jointly organized by Alliance of Blockchain Industry, Z-Park and Cointelegraph Chinese, Fei Li, partner of MYEG China, said that digital collectibles are a new economic digital commodity whose value will be gradually amplified.

In the future, people will spend more time in the metaverse world. Li also believes that there will be more practical application scenarios for digital collectibles, integrated with lives and some industries.

The metaverse is a virtual space that serves as a bridge between the real world and the virtual world. It is used to depict the realities of the real world, allowing users to work, play, have fun and even build their houses.

Even many experts predict that the metaverse will replace the real world one day.

Facebook has rebranded to Meta, planning to transform into a metaverse company. It has launched the metaverse social platform Horizon Worlds.

Meta, Nvidia, Microsoft and Apple have announced their forays into the metaverse sector.

Amber Lu, head of Flow China, said at the event that the metaverse is a product of human beings expanding the dimension of a new world, which is born from the real world and is parallel to the real world while interacting with it.

The metaverse thrives with digital collectibles

Digital collection is a blockchain-native scenario for C-end users, where users are willing to pay for it.

In 2021, digital collectibles first boomed overseas, and people also called 2021 the year of digital collectibles.

At present, the entire digital collectibles industry is in an upward channel, and many developers and platforms are exploring innovative models. Chang Chen, CEO of Zhigui Technology, said, “In the short term, the demand for digital collectibles is obvious, and the model is clear, with many platforms and well-known IPs contending. Next, the quality of platforms and the content of collectibles will become more important, as consumers will no longer be curious about all collectibles. Quality IPs and content will definitely become the object that some platforms compete for.”

In the metaverse, users can digitize assets through minting protocols to allow the flow of value. Digital collectibles can meet the needs of scarcity, uniqueness, digital property rights and trading.

In the future, the development of the metaverse will undoubtedly step up gradually, which will also facilitate the development of digital collectibles. Zhiping Li, global technical head of Blockchain Infrastructure and Facility, said, “Digital collectibles are an inevitable element in the metaverse. The metaverse also promotes the rapid development of digital collectibles.”

The challenges of digital collectibles in China and abroad

As digital collectibles prevail around the world, the domestic digital collectibles market is also making waves. Digital collectibles as an art carrier and presenting form provide creators with more imagination to expand the boundaries of human creativity.

Digital collectibles abroad are blossoming in various fields, currently mainly for artwork, games, applications, sports and others, while domestic digital collectibles are actually still in an initial exploratory stage. 

For the time being, domestic digital collectibles have not given full play to advanced features, such as interactivity, composability and programmability. Lu claims that there are still relatively few innovative use cases in China, and the typical community value has not yet been brought into play.

Due to the different positions and regulations on digital collectibles at home and abroad, as well as cultural differences, digital collectibles are bound to adopt different methods of capturing value.

The development path of domestic digital collectibles is different from that of overseas markets. Chinese businesses are more from the perspective of copyright protection to play the function of proving digital asset credentials. Foreign platforms are more inclined to the attributes of the virtual world and its applications.

Regardless of the overseas market or the domestic market, the development of digital collectibles has to break through a plateau. 

Li summarized three challenges, saying, “First, the whole ecosystem is not yet robust; we need to establish a huge developer community. Second, regulation is immature; for any new thing to develop healthily, it must conform to the regulatory governance rules of countries. Third, a reliable, stable and credible digital collectibles platform needs to be built to improve the credibility of digital collectibles in the circulation process.”

Digital collectibles should not be confined to the virtual world; they also need to be connected with the real world. Thus, digital collection technology can return to its essence and receive long-term development.