Posted on April 28, 2022, 12:00 PMUpdated on Apr 28, 2022 at 5:11pm
Little by little, banks are entering the game, and Standard Chartered this week announced that it is embarking on a switch to metaverse. The British group bought a digital plot of land on the platform The Sandbox, a publisher of video games and one of the most used virtual spaces along with Decentraland and Roblox.
“Our commitment will allow us to reimagine the relationship with our current and future customers and offer new experiences,” said Marie Hoyen, General Manager of the bank’s Hong Kong branch, in a press release.
With this initiative, Standard Chartered joins other big names in finance who have recently entered the depths of the deep end of metaverse. Even if their intentions remained vague at this point.
Major JP Morgan
JP Morgan opened at the beginning of the year, through its cryptocurrency subsidiary Onyx, a lounge on the virtual platform Decentraland, where avatars can roam, admiring a photo of its boss Jamie Dimon, but also report on the bank and its blockchain initiatives.
HSBC also put itself on the subject by purchasing a plot of land on The Sandbox last March. Spain’s Caixa also opened a few weeks ago, via its digital service subsidiary Imagin, a virtual café in Decentraland. Finally, Korean banks are at the forefront of this topic.
After tech giants, luxury brands, and clothing brands, it’s finances turn to take an interest in these new and immersive virtual worlds, pre-forming Web 3.0. At the moment, there is no doubt about going to withdraw money or get credit from a virtual agency.
The decline of French banks
“Demands are still very limited. Currently the Metaverse is a laboratory for the few banks venturing there, and it is more of a marketing strategy than an industrial reality at the moment,” says Alain Cloute, Head of France Fintech. Analysts remain skeptical about the growth drivers in this sector.
Some French players all position themselves identically. Fintech Card, which offers bank accounts to teens, has announced its arrival at The Sandbox. In the insurance business, AXA bought a plot of land on the Hong Kong platform in February.
But the major French banks have not yet backed down. “There is a kind of reluctance on their part, because they do not see an immediate interest, admits Thomas Rockaful, Associate Director at Sia Partners. It is a shame because the reward for a first mover can be decisive.”
However, bank managers are interested in the topic, some of them even experimented with the organization of meetings in these virtual worlds. But without going any further. The risks inherent in this universe, which are still tied to the cryptocurrency environment and remain poorly regulated at the moment, could put more than one banker on hold.
Payment Prospects
“As always with deep innovation, there is a learning curve that can take time, however, warns Alain Clot. It is also a way of demonstrating their ability to embrace new technologies and new trends and thus attract new talent.”
The pioneers of the metaverse are convinced of this: the development of these virtual worlds will be funded. In a recent report, JP Morgan emphasized that the success of the metaverse “will depend on a robust and resilient financial ecosystem that will allow users to seamlessly connect between the physical and virtual worlds.”
Thomas Rocafull explains: “In the medium term, we can imagine a new distribution channel with virtual agencies. In the shorter term, banks should have a role to play in payments, as transactions will increase in this universe. They should not leave themselves confused.”
In the meantime, the banks decided to exploit this context in terms of investment themes. In addition to its access to The Sandbox, HSBC is offering its wealthy Asian clients the opportunity to invest in a portfolio of assets linked to metaverses. BNP Paribas Wealth Management has also included the metaverse as one of its five key investment themes for 2022.