Bankless: Why is Hyperfy v2 so important?

Author: William M. Peaster, Bankless; Compiler: Bai Shui, Golden Finance

This week, I wrote about Eliza Daydreams and the Wayfinder proxy framework, which got me thinking about Hyperfy.

I am very interested in game infrastructure such as Eliza and Wayfinder, especially fully on-chain games.

But the possibilities for these systems extend beyond pure gameplay aspects to include virtual worlds like Hyperfy, a browser-based VR platform that works on any device.

Still, Hyperfy is in the news this week for a few reasons: elizaOS just added support, and the Hyperfy team just open-sourced their engine and launched $HYPER along with a new, more accessible approach to the platform.

That last point - a more accessible approach to platforms - I want to dive into a little bit more here, because I think it's an example of the "right way" and is indicative of a trend toward metaverse experiences.

Why Hyperfy v2 is important

In Hyperfy v1, customizable virtual worlds can be minted as NFTs of ETH.

This feature has been removed from the v2 system, so now anyone can create Hyperfy virtual worlds anytime, anywhere for free. We've seen many people testing this newfound freedom.

No-code tools are also coming soon, which will make building here even easier. But my favorite thing about the v2 shift is that it 's a shift toward rich prospects in terms of digital land.

I like this move away from artificial scarcity because it rejects the pitfalls of the past.

In fact, there is a serious problem with the Metaverse boom of 2021, and that is the death spiral of land speculation.

This phenomenon is not unique to NFTs, it has been observed for decades in virtual worlds like Second Life and games like EVE Online and Final Fantasy.

These death spirals occur when projects make digital space behave too much like physical land, which is scarce and highly valuable, leading to a speculative bubble that eventually bursts.

So in moving towards being free and open, Hyperfy gives itself the best chance to thrive and attract a powerful, happy and vibrant community that can do what they want, how they want Do what they want the way they want, when they want, and with whatever assets and NFTs they want to bring to the table.

This pushes the issue of artificial scarcity to the level of the user, who can still choose to place the token in their world if they wish.

But this is decided by the user. If artificial scarcity is implemented at the platform level without the use of counter-mechanisms like metaverse land taxes and citizen dividends, then stagnation or pain will set in.

So yes, it's refreshing to see a project like Hyperfy decisively move away from the mistakes we've seen other teams make over the years.

There are no inherent limits to virtual lands, and more free virtual lands can always be created. Hyperfy is on the right side of this paradigm right now, and I think this dynamic can greatly help unlock its potential over time.

Then throw into the mix advances like AI agents and Midjourney's upcoming Holodeck, which can generate 3D spaces on demand in real time, and the future looks endless when it comes to building, populating, and enjoying new excitement in virtual worlds.

These advances and prospects lay the foundation for a new wave of interest and experimentation in the virtual world, which is sure to filter into other areas such as DAOs and DeFi.

Just something to think about, right.

If you want to try Hyperfy for yourself, a great place to start is by attending The WIP, a Metaverse party that's been running since 2019 and is live on Hyperfy every Thursday. You'll meet some of the best in crypto, and from an alpha perspective, it's definitely worth your time.

Now, don’t miss the forest for the trees. As Vance Spencer once said, “The metaverse narrative [remains] the broadest of all narratives, a superset of all other cryptocurrency narratives.”