Privately held Fidelity Investments has been experimenting at the cutting edge of virtual reality, Web3, and the metaverse for years. The investment giant began mining Bitcoin in 2014 to learn about cryptocurrency, and started offering cryptocurrency trading and custody for institutional investors in 2018. A virtual Fidelity building in the Decentraland metaverse includes a game, the Invest Quest, that teaches players about exchange-traded funds.
As part of our recent research initiative on Web3 and the metaverse, we spoke to Adam Schouela, Head of Emerging Technology at the Fidelity Center for Applied Technology.
Building to learn. Web 1.0 was about reading — people posted and consumed content. Web 2.0 was more social — think of everyone being able to contribute now. Web3 is read, write, and own. There’s a lot of implications to that.
Our approach is to roll up our sleeves and build these things. It’s not just about building, it’s building to learn — to understand how things interact, to generate insights and implications about how these things are going to potentially impact Fidelity and our customers and society as a whole. Without trying it, it’s really hard to get to those understandings. The real innovations or sparks that come out [are] in the white spaces between technologies — the mashup of all these different types of things together. Without mixing and matching, you don’t necessarily get the front row seat to see what could possibly happen.
Preparing for the technology that will win in the market. Fidelity is a large company, and it’s not like startups that are super nimble and fast moving. One way where we try to address the speed issue [is that even] without a business case, we trying to start building components. The Pebble watch was the first smart watch. So we built an app on the Pebble watch, not because we thought it would be the next big thing, but to understand the use cases for how people would want to interact with something like it. Then, the Apple Watch comes out, which is a more mass market version [of a smart watch,] and we were first to market [with a financial markets app], because we built it a year and a half earlier and we understood the use cases. We’re not necessarily building it for the now, but we’re building these LEGO bricks or components… [we’re exploring things like,] what’s a good way to interact, what’s a positive user experience, what is the social connectivity? What are the design principles that make for really positive interactions with these new types of technology? Our advantage is we get to learn about these different technologies.
Differences and definitions. I don’t necessarily think Web3 and the metaverse are the same. They’re different technologies. An example is insurance. It’s not exciting, but the idea [with Web3 is] that I could insure a deposit or something, and pay premiums on what I’m insuring, or I could take the other side of that equation and put up collateral and take the premiums. I see that as separate from the metaverse, but those two things have the strong potential to intertwine together.
We probably don’t have a universal definition of the metaverse, and I actually think that’s OK. The current working definition is a graphically-intensive, parallel world to the IRL [in real life] world we live in.
We probably don’t have a universal definition of the metaverse, and I actually think that’s OK. The current working definition is a graphically-intensive, parallel world to the IRL [in real life] world we live in. Some of the most impactful parts of the technology, I’ve found, is not the visual stuff, but it’s the 360-degree sound. I’ve been in some worlds before where you can tell exactly where someone is inside the landscape because of the sound.
Digital twins to take care of tasks. We most certainly have thought of the concept of a digital twin of ourselves in [the metaverse], taking care of things that we might need. What are the types of things we might want taken care of for us in that kind of space? The other thing is, given this new type of space, what are the new business opportunities and models that will show up in these new types of environments?
We’re used to securing financial transactions, but what about social transactions? Is the person I’m talking to really the person I think I’m talking to? In some cases, anonymity is a strength, and in others it can be a cautionary tale.
One of the perspectives we’re looking at it is how easy is it to build in these [metaverse] spaces. You have some worlds where it’s rudimentary, and others where it’s more complex and rich, where you need specific people [with the skills] to build in it. That’s an axis we’ve been exploring.
VR training. We’ve done VR training for a while at Fidelity, [for scenarios like helping] an associate in a contact center get the context of what the phone call to Fidelity is about. …You get to see the impact that your interaction has on the customer. In one example, a customer looks to withdraw funds, and she asks for a check. You find out why she needed the check, and it was to pay a mortgage due in three days. Had you not asked, the money wouldn’t have been there in time. It needs to be e-transferred. You get to see in the home, and you see physical reactions of the people. Extenidng that to a metaverse situation, where people can get together and have that conversation about what happened and why, [that can enforce] those learnings from the training program.
An annual ‘priorities report.’ The research team at Fidelity produces [a report] at the beginning of the year called the priorities report. They’re looking for new technologies and socioeconomic trends, and the impacts of those things. That priorities report is the cornerstone of a lot of the things we do. There are chapters on certain things, but they don’t write about the same technologies or trends every year. It turns into a library of all these different trends that are brewing… AR and VR came from a report that talked about emerging user interfaces, which was all about voice interfaces, and immersive interfaces like AR and VR. Our teams work closely together; we have researchers sitting on our teams.
What comes first? Will Web3 or the metaverse arrive sooner into the mainstream? I have the luxury of not needing to think about that, and it’s really hard to predict the future. They’re two very interesting trends, and we look at the use cases and the design principles. What if these two hit the shore together, then what are the implications? [The question is] not necessarily what’s going to win.
When the environment shifts, the new business models will start to emerge, and [our job is to ask,] “What are the ways we’re going to want to be able to interact, or support those new business models?”