A comprehensive overview on Metaverse

Looking back on 2021, the first year of the Metaverse, its breakout was significantly more intense, and market participants' responses were much faster than when the internet first entered global consciousness. A peek at the global and Chinese marketplaces demonstrates that the Metaverse has evolved into a setting for all of mankind to explore the next stages of growth in society, technology, legal systems, and the arts, rather than just an experiment for small-scale players. With the dramatic drop in Metaverse-related stock prices in 2022, the capital market's overwhelming enthusiasm has since begun to fade, and people are now seeing the Metaverse prospect more sensibly. The Metaverse shall profoundly alter people's work, lives, and social interactions, eventually resulting in the creation of a new universe. Companies that focus on proper positioning, constant development, and exceptional talent will generate a viable Metaverse that inspires continued interest after the euphoria has subsided.

What exactly is the Metaverse?

So, what is metaverse? The concept of the metaverse has been popularized by science fiction and futurists, and has been explored in the context of virtual worlds, online communities, and gaming. It has also been used in the context of the Internet of Things (IoT). There are many applications of metaverse or metaverse use cases such as virtual reality gaming, virtual events, virtual tourism, virtual education, virtual shopping and virtual work. A metaverse development company or metaverse developers usually specializes in metaverse software development, often utilizing cutting-edge technology and innovative design to enhance the immersive experience for users.

The Metaverse is indeed a compilation of all virtual worlds created with blockchain technology. It might be gaming worlds, NFT galleries, curated territories, or digital streets.

The most fundamental aspect of the Metaverse to understand is that it is not a single location. Media companies, music publishers, clothing labels, and bitcoin analytics tools can all be found in the Metaverse.

Rock stars, rappers, Care Bears, and Smurfs all fall into this category. So it's a big church with plenty of room for everyone.

What distinguishes the Metaverse from other online social platforms such as Second Life and Minecraft is the space between centralization and decentralization.

Previously, digital spaces were closely controlled by a single firm from their own servers. Every time you left their realm and entered another, you had to sign up with a new identity. The Metaverse allows you to travel across and across the developing network of virtual environments using a single identity. This makes it more like a reflection of reality. When you travel to new towns, cities, and countries, you do not need to obtain a new passport each time.

Understanding the seven layers of the Metaverse

According to entrepreneur and author Jon Radoff, the Metaverse is divided into seven distinct layers, each of which influences one aspect of the user experience:

  • Experience:
    As physical space dematerializes in the digital world, the limitations of physicality will be removed. The Metaverse will offer people a variety of experiences that we cannot currently enjoy.
  • Discovery:
    Customers can learn about new platforms through app stores, search engines, and rating websites thanks to this layer. This critical step is required for the discovery of new technology and communities.
  • Creator economy:
    Developers use various design tools and apps to create digital assets or experiences. Various platforms, such as drag-and-drop tools, are gradually developing more straightforward creative methods.
  • Spatial computing:
    This technology combines mixed reality (MR), virtual reality (VR), and augmented reality (AR) (AR). It has evolved into a significant technology category that allows users to interact with 3D environments for enhanced experiences over time.
  • Decentralization:
    The Metaverse will not be ruled by a single authority. As the Metaverse expands, enabled by blockchain technology, scalable ecosystems will assist business owners in providing a more comprehensive range of specialized digital items.
  • Human interfacing:
    The Metaverse s hardware layer must include human interfacing. A person s body can be accepted as a 3D, realistic avatar in any virtual world.
  • Infrastructure:
    The infrastructure layer includes the technology that powers people's devices, connects them to the network, and distributes content. Over time, 5G networks will significantly increase the Metaverse's capacity.

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How does crypto fit into the metaverse?

Gaming gives the 3D part of the metaverse but does not cover all required in a virtual world that can include all aspects of life. Crypto can offer the other key parts required, such as digital proof of ownership, transfer of value, governance, and accessibility. But what do these mean exactly?

We will need a secure system to establish ownership if we operate, communicate, and even buy virtual items in the metaverse in the future. We must also feel secure when moving these commodities and money around the metaverse. Finally, we will also want to play a role in the decision-making taking place in the metaverse if it will be such a large part of our lives.

Some video games already include some rudimentary solutions, but many developers prefer to employ crypto and blockchain as a better choice. While video game development is more tightly managed, blockchain allows for a decentralized and transparent approach to dealing with the issues.

Blockchain developers also take influence from the video game world too. Gamification is common in Decentralized Finance (DeFi) and GameFi. It seems there will be enough similarities in the future that the two worlds may become even more integrated. The following are the key properties of blockchain that make it suitable for the metaverse:

  • Digital proof of ownership:
    By owning a wallet with access to your private keys, you can instantly prove ownership of activity or an asset on the blockchain. For example, you could show an exact transcript of your transactions on the blockchain while at work to show accountability. A wallet is one of the most secure and robust methods for establishing a digital identity and proof of ownership.
  • Virtual collectibility:
    In the same way that we can determine who owns something, we can also demonstrate that an item is original and one-of-a-kind. This is critical for a metaverse that wants to incorporate more real-life activities. We can use NFTs to construct objects that are completely unique and cannot be replicated or forged. A blockchain can also represent ownership of physical items.
  • Value transfer:
    A metaverse will require a secure method of transferring value that users can rely on. In-game currencies in multiplayer games are less secure than crypto on a blockchain. If users spend a significant amount of time in the metaverse and even make money there, they will require a trustworthy currency.
  • Governance:
    Users should be able to control the laws of their interactions with the metaverse. In real life, we can have voting rights in companies and elect leaders and governments. The metaverse will also require methods for implementing fair governance, and blockchain is currently a proven method for doing so.
  • Accessibiity:
    Anyone in the world can create a wallet on public blockchains. Unlike a bank account, you are not required to pay any money or submit any information. As a result, it is one of the most accessible methods of managing finances and an online, digital identity.
  • Interoperability:
    Blockchain technology is constantly improving platform compatibility. The Polkadot (DOT) and Avalanche (AVAX) projects allow for the establishment of distinct blockchains that can communicate with one another. A single metaverse will be required to connect different initiatives, for which blockchain technology already has solutions.

Features of the Metaverse

The Metaverse's operation is built on the following key features:

  • Incorporation of avatars
    One of the basic principals of the Metaverse is the creation of digital avatars of oneself as a means of uniquely expressing one's emotions and feelings. Every individual has their own digital identity, which can be static or animated and is unique to them. Avatars are a unique way to express yourself because, in addition to being exact replicas of your actual form, they can also be recreations of your favorite celebrities or something completely original.
    Gamification is introduced when users have the option to customize their avatars, resulting in a more engaging and dynamic experience.
    Avatars are frequently altered and can closely resemble their users' real-life counterparts in certain ways. Avatars can occasionally be computer programs. Users can control their avatars using keyboards, joysticks, mice, and specialized human-computer interfacing (HCI) devices. More lifelike avatars may provide a more immersive experience for viewers or anyone interacting with them.
  • Blockchain-based operations
    Blockchain protects consumers' virtual assets and provides digital proof of ownership, making it an essential component of the Metaverse. The Metaverse is seeing an increase in data volume, value, and the importance of security and dependability. To ensure data validity in the Metaverse, blockchain skills and technology are required, and artificial intelligence is used to protect its diversity and wealth of material.
    The Metaverse concept is incomplete without blockchain due to the numerous drawbacks of centralized data storage in systems such as database management systems (DBMS). The blockchain-based Metaverse provides access to any digital location without the influence of a centralized organization.
  • The use of virtual land (parcels)
    The Metaverse's demand for virtual land is skyrocketing. Anyone can buy land in the Metaverse for cryptocurrencies. The land is a non-fungible token (NFT), a type of blockchain asset that cannot be traded for other things. The fundamental number of pixels in a plot of Metaverse real estate is referred to as size.
    On virtual land, users can interact with digital storefronts, virtual gaming, and even entertainment. Its size and location will determine the land's use cases. Plots near a VR street, for example, may be worthwhile due to the possibility of displaying advertisements.
  • Immersive Experiences (AR and VR)
    By utilizing mixed reality and AR/VR technologies, Metaverse participants will be able to have more immersive experiences that converge reality and the virtual world. It's easy to see why the Metaverse is becoming more popular by the day: it brings games to life, concerts and plays to life, as well as professional or educational encounters to life.
    AR and VR are the main building blocks of Metaverse projects. The connectivity of actual and virtual environments, real-time interaction, and accurate 3D object rendering are three key components required for augmented reality systems to function.
  • Intersection with artificial intelligence (AI)
    AI is critical to the Metaverse as the driving force behind corporate research in fields such as content analysis, self-supervised speech processing, robotic interactions, computer vision, and wholebody posture estimation.
    AI can be used to deliver Metaverse business applications in a variety of ways. AIOps, a subfield of AI, uses machine learning to help businesses manage their IT infrastructure, which will soon be applicable to Metaverse systems. Furthermore, AI-powered chatbots are becoming increasingly popular among businesses. AI bots with lifelike avatars can be used for a variety of purposes in the Metaverse, including sales, marketing, and customer support.
  • Decentralized Autonomous Organizations (DAOs) for governance
    A DAO is a governance body, similar to a council or a committee, that uses blockchain and smart contracts to reach decisions. The Treasury Wallet, according to DAO governance guidelines, provides money for farming across multiple networks. All decisions in DAOs are still governed by proposals and voting procedures to make sure that everyone in the organization has the chance to take part in the governance process. The procedure is critical for helping participants in casting ballots on important Metaverse resource management decisions.
  • Use of Human-Computer Interface (HCI) technology
    Metaverse is a massive online computer platform that includes a wide range of platforms, devices, and individual users. The application of HCI in the creation of the Metaverse — specifically, how to integrate user activities into the virtual world — is critical to achieving this goal.
    To participate in specific activities, a human and a computer exchange information via a process known as HCI. The most important advantage of human-computer interaction is that it assists groups in need of formal training and information on how to connect with computing systems.
  • Emphasis on social interactions
    Avatars and visual representations of users are used by humans to communicate and interact in the Metaverse. Users can interact with the Metaverse as well as other users. These exchanges take place in cyberspace, which serves as a representation of the real world.
    However, there are distinctions between the economic and physical constraints of actual locations. Our physical experiences in the real world could merge into a single virtual environment. People will be able to navigate the infinite world thanks to this holistic experience that will bring together all of these disparate encounters.
  • Web3 Support
    Web3's goal is to usher in a new era of the internet. It is the development of user ownership and control over their online content, digital assets, and online personas. Web3 and Metaverse technologies complement one another perfectly. Because the Metaverse is a virtual environment that prefers a decentralized web, Web3 may provide the foundation for connectivity.

Examples of Metaverse platforms:

To grasp the concept of the Metaverse, consider the following platforms that are bringing this vision to life:

  • Decentraland
    Decentraland is a virtual social environment based on blockchain technology. It is used to create, trade, earn money, and navigate virtual worlds. It is essentially a digital ledger that records bitcoin transactions across a network of computers and serves as the foundation for the Decentraland universe. It offers exceptional opportunities for both studying and having fun with virtual experiences. Decentraland can be used to hold meetings and trade virtual goods in marketplaces, among other things. Interacting with other members is as simple as it is in real life.
  • The SandBox
    A 3D virtual world hosted on the Ethereum blockchain where users can interact, build things, and earn money. Sandbox supports a wide range of devices, including Windows phones and smartphones. People can earn money by participating in new virtual experiences. However, it is not cheap to use. SandBox has created its SAND coin, which is based on Ethereum, to make this possible. SAND tokens can be used to pay for gas on the Ethereum network.
  • Bloktopia
    Bloktopia provides users with an immersive experience by utilizing virtual reality. It is a 21-story virtual structure representing the current 21 million Bitcoins in circulation. It offers a variety of revenue-generating opportunities with new virtual experiences. People can create their own avatars, take part in various activities, learn about cryptocurrencies, and buy virtual "real estate" in the tower. You can also use this real estate to create artwork, games, sequences, and other things by using the platform's builder tool.
  • Meta Horizon Worlds
    On Horizon Worlds, users can socialize, conduct business meetings, explore the virtual environment, participate in virtual activities, and play games. Horizon Worlds is one of Meta's VR social apps. Blockchain technology is not used in the Horizon universe. It includes functional VR building blocks like code blocks, music, and animation effects to help content developers, as well as navigable VR settings. Horizons was launched in August 2020 as a test platform for virtual explorers with an invite-only policy by Facebook (now Meta Platforms Inc.).
  • Metahero
    The Metahero project provides usable technology that allows users to scan real-world objects and transport them to the Metaverse rather than a virtual realm. Its primary goal is to digitize physical artifacts using ultra-HD photogrammetric scanning technologies. Users can use Metahero as a portal to start exploring the NFT, social media, fashion, and many other aspects of the Metaverse with their 3D avatars. Metahero creates high-resolution avatars out of real-world objects, including people.

What’s the biggest metaverse?

With over 200 million monthly active users, Roblox is considered the largest metaverse world.

The number is gradually increasing. It had approximately 180 million monthly active users in January 2021 and surpassed 225 million in December. According to Activeplayer.io data, the numbers after that hover around 200 million.

Roblox servers only accept 100 players per game, but it has the most active users overall.

What are the top metaverse platform rankings?

Here are the metaverse platform rankings according to monthly active users:

Source: Activeplayer.io, Dappradar data (July 2022)

What is the metaverse market size?

Here’s a table of the metaverse market size per year:

Source: (ReportsAndData, Statista 3)

Companies worldwide plan to invest in the Metaverse by 2022.

More than half of responding businesses in a March 2022 survey of companies from selected countries that have already invested in the metaverse stated that they invested in cryptocurrencies. NFTs came in second place. Work environment and remote work ranked third, with 40% of respondents saying they had invested in projects in this sector.

Source: Statista 2022

An in-depth examination of firms perspectives and investments in the metaverse

Leading industries are already investing in the metaverse 2022.

According to a March 2022 survey of companies from selected countries that have already invested in the metaverse, businesses in the computer and information technology sector were the most likely to have done so. Overall, 17 percent of companies in this sector had already invested in the metaverse as a business opportunity, with the education sector coming in second at 12 percent of responding businesses.

Source: Statista 2022

After polling 200 of these companies in Europe and the United States about their digital strategy for the metaverse, we can see how deep the rabbit hole goes and how the metaverse is transforming into, presumably, a privileged playground.

52%
of brands believe customers are ready for the metaverse

5 years
The time companies believe the metaverse will need to boom

26%
of brands expect to see a return on investment in the metaverse

Let's build together on Metaverse

The Metaverse Is the New Risk-Taking Cap

55% of industries believe the metaverse is a risk worth taking.

When asked why they started investing in it, the surveyed companies said it is "the future" (22%).

Source: Sortlist

Every Company Will Have a Piece of the Metaverse

Brands are so confident in the metaverse that only about 3% believe it will take more than ten years to reach global consumption.

The majority (68%) believe it will boom in the next five years.

76% believe that the virtual world will provide opportunities for all industries.

33% of brands invest 10-20% of their budget in the Metaverse.

When asked what percentage of their budget they set aside for metaverse projects, one-third of businesses said it was between 10% and 20%.

Source: Sortlist

Source: Sortlist

Metaverse for Business: Expectations.

Despite the fact that 20% of users see the metaverse as a "way of escaping the real world," it has proven to be the exact opposite for brands, who believe (26%) that a trip into virtual worlds will yield more than just entertainment for customers: profit

The Metaverse's Ideal Metaverse Customer Target Audience

Companies that have invested in the metaverse understand that this new realm is primarily aimed at men (11.3%).

Big brands (10.7%).

Millennials (9.3%) and Gen Z (9.9%).

Source: Sortlist

Source: Sortlist

The Metaverse is Designed for Businesses With Innovation Departments

47% of brands that have already invested in the metaverse say their innovation departments are most interested in metaverse initiatives.

This demonstrates that businesses are ready for new technologies in the field, but it also highlights an important reality: innovation departments are a hallmark of larger corporations.

Source: Sortlist

As of August 2021, brand-related attitudes toward the metaverse among internet users in the United Kingdom and the United States

According to an August 2021 survey of internet users in the United Kingdom and the United States, 15% in the UK and 22% in the US thought brands should advertise in the metaverse. Brands should use the metaverse to create more branded experiences, according to 13% of respondents in the UK and 19% in the US.

Why Is the Metaverse Now Rising?

The Pandemic had a significant impact on the Metaverse's eventual realization.

The combination of the health crisis and the need for businesses to undergo digital transformation has increased interest in the metaverse as a business opportunity.

The pandemic accelerated the metaverse technology, according to 92% of companies polled.

The renaming of Facebook caused a rise of Metaverse interest.

How fast is Metaverse growing?

Number of apps with the metaverse keyword in their names in 2021-2022

In January 2022, 27 apps added the keyword "metaverse" to their name or description, a 145 percent increase from the 11 apps that updated their names in October 2021. During the Facebook Connect event in October 2021, Facebook announced its new name and next futuristic endeavor. Far from being a rebranding exercise, Facebook's new name Meta reflects the company's new focus on creating an immersive metaverse experience.

2021: US gamers participating in non-gaming activities within video games

Non-gaming activities will be a significant part of the online-gaming environment in 2021. In the last year, approximately 60% of gamers in the United States engaged in non-gaming activities, with virtual recreations of social or life events within games being the most popular. Second place went to online hangouts where gamers watched in-game movies, TV shows, and previews together. In total, 20% of respondents said they had attended live in-game concerts such as Travis Scott's Fortnite concert.

Source: Statista 2022

2021: US gamers engaging in non-gaming activities within video games

Non-gaming activities will be a significant part of the online-gaming environment in 2021. In the last year, approximately 60% of gamers in the United States engaged in non-gaming activities, with virtual recreations of social or life events within games being the most popular. Second place went to online hangouts where gamers watched in-game movies, TV shows, and previews together. In total, 20% of respondents said they had attended live in-game concerts such as Travis Scott's Fortnite concert.

2021 global market capitalization of the metaverse, Facebook, and gaming

The total market capitalization of Web 2.0 metaverse companies was 14.8 trillion US dollars as of October 2021. This figure is much lower for gaming and eSports, as well as Facebook (now known as Meta following an October 2021 restructuring and pivot to VR), at 1.98 trillion and 0.90 trillion, respectively.

By generation, the proportion of internet users in the United States who would be interested in virtually attending a live music event in the metaverse as of March 2022

A survey conducted in the United States in March 2022 found that 41% of respondents would be uninterested in virtually attending a live music event in the metaverse. Overall, Millennials expressed the most interest in attending a virtual music event in the metaverse, with 32% saying they were somewhat interested and 29% saying they were very interested. Although 32% of Generation Z said they were somewhat interested, 30% said they were completely uninterested in virtually attending music events in the metaverse. The Baby Boomer group expressed the least enthusiasm for such an online event.

Importance of metaverse

The Metaverse is more than just a new emerging technology that is part of today's hype cycle. It is the culmination of years of research into artificial intelligence and immersive interactivity, and it will transform businesses in a variety of ways.

  • It is a novel method of interacting with users.
    As a business, you can use the Metaverse to provide customers with a whole new level of immersive experiences and entertainment options. If your company is one of the first to offer clients a Metaverse experience, you will gain a competitive advantage and attention.
    Branded gaming experiences, virtual items, and AR/VR showrooms are all ways to promote your company in the Metaverse. Businesses can use the Metaverse to create immersive, engaging 3D marketing experiences that capture the attention of potential customers in novel and embracing ways.
  • Businesses can find virtual event opportunities.
    It's not unusual to organize a conference or live event that can be viewed both online and in person. Many people are unable to travel to a professional conference or lecture, but this is no excuse for not learning more. A conference in the Metaverse, as opposed to a simple Zoom or Google Meet stream, can be a full-fledged VR experience, with suitable networking and participation opportunities, instead of simply another video in a small window with comments underneath it. Because of VR and the Metaverse, spectators will feel more present and immersed in the experience.
  • Businesses can advertise and sell their products.
    Several companies are already using augmented reality to allow customers to virtually try on clothing or eyewear, see how new furniture might fit in their space, or get a makeover with new hair or cosmetics. There is the possibility of having the same experiences but in a better way in the Metaverse.
    If you have the option to lease or buy commercial property, you can set up shops and showrooms in the Metaverse where users can view your products. Users continue to buy virtual clothing and accessories with zeal today, demonstrating that digital fashion is having a moment.
  • The Metaverse introduces a new advertising medium.
    In an e-commerce business, brands can engage with a massive global audience via Metaverse platforms. Businesses should expect to see novel techniques for brand storytelling and general advertising introduced in the Metaverse. One of the most effective ways to boost brand awareness and identification is through storytelling.
    People enjoy hearing stories that tell much more about a company's beliefs and values than simple slogans. Storytelling will evolve into "story living" when audience members become active players or even characters with a say in the events rather than passive listeners.
  • It is possible to improve teamwork and process creation.
    We have all come to terms with the new realities of online meetings and remote teamwork. These methods were imposed on us, but they worked just as well in a face-to-face office setting. Using the Metaverse can help to improve workflows even further. Meetings will be displayed as a group of people sitting in a room instead of Zoom calls.
    Meta has already begun to provide VR workrooms. The Metaverse provides workers with a digital environment for communication, as well as the ability to read each other's body language and emotions and maintain an emotional bond.
  • E-wallets and cryptocurrencies facilitate business transactions.
    Cryptocurrencies and the Metaverse are inextricably linked. Even at this early stage of adoption, it will be difficult to reap the benefits of the digital world without a crypto wallet. Metaverse also supports digital wallets, allowing businesses to control transactions across their virtual ecosystem.
    Although this concept may be intimidating to some business users, blockchain technology and cryptocurrencies have more advantages than disadvantages. Users and businesses can conduct any online transaction more conveniently with cryptocurrency. There is no need to connect your bank account to virtual worlds; payments are as simple as a few clicks, and all transactions are transparent.

Source: Tidio

Leading metaverse Advantages in 2021

According to a late 2021 survey of global internet users, the biggest benefit of the metaverse was combating challenges that prevented them from doing something in real life. Enhancing creativity and imagination came in second place, with 37% of respondents citing this as a benefit. Upskilling, education, and exploring new career opportunities are also possibilities in the metaverse.

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