How to Invest In The Metaverse
In this article, you will find out the best investing opportunities in the metaverse that may bring you a lot of fortune.
The term metaverse is all over the news these days as it is one of the newest areas of technology that has taken the world of cryptocurrency by storm. Emergen Research estimates that the metaverse could become an $800 billion industry by 2028 so the investors who are fully aware of the metaverse want to get a piece of the pie.
Moreover, some big tech companies have set their sights on this new virtual technology and included the metaverse in their design plans especially since Facebook rebranded itself to become Meta. The metaverse has piqued many investors’ interest as many people have firmly bought into the metaverse as being our technological future.
What is the Metaverse?
The concept of the metaverse was first introduced in the 1992 science fiction novel, Snow Crash, by Neal Stephenson. It is the next iteration of the internet that gives users an immersive experience beyond the capabilities of today’s internet. Besides a PC or a smartphone, users of the metaverse would use tools such as virtual reality headsets and controllers to enhance the experience.
The metaverse generally refers to connecting people around the world through augmented and virtual realities. It also relies on blockchain technology to create a new digital economy where cryptocurrency plays a significant role, along with NFTs and e-commerce.
The metaverse generally describes 3D virtual worlds that let you play, socialize, learn, and collaborate outside of the physical world.
The Main Methods of Investing in the Metaverse
Here are the top methods of investing in the Metaverse each of which has its own unique benefits for investors.
1. Metaverse Games
Metaverse games are one of the best ways of investing in the metaverse. The exponential growth in this area of gaming was driven by high-profile projects like Decentraland and The Sandbox.
These gaming projects feature rich 3D worlds where players create their own avatars and can interact with other players’ avatars. Play-to-earn (P2E) mechanisms are one of the most appealing factors for gamers that allow them to earn rewards (denominated in cryptocurrency) for their in-game actions. Essentially, this means gamers can monetize their gameplay skills in a fun way.
One of the most exciting gaming projects of the metaverse is Battle Infinity that incorporates a fantasy sports league into its metaverse, offering a way for sports fans to strategize and earn rewards for skilled gameplay. These rewards are distributed in IBAT, which is Battle Infinity’s native token.
Battle Infinity offers several other enticing features one of which is the ‘Battle Store’, which provides an array of multiplayer P2E games for users to play – expanding rewards potential.
2. Metaverse NFTs
People can also invest in the metaverse through NFTs. One main factor that makes NFTs attractive from a metaverse standpoint is that they can provide ‘true’ ownership of in-game assets.
For example, the in-game playing cards are structured as NFTs in the Gods Unchained metaverse game. Thus all of a player’s cards are genuinely theirs, preventing them from being stolen or altered. In turn, this reduces (or removes) the concept of cheating or hacking from the game.
In the case of Battle Infinity, in-game items can be easily traded as they are structured as NFTs. Battle Infinity has a dedicated NFT marketplace within its ecosystem (called Battle Market) that allows players to buy, sell, and trade in-game items.
For example, users can purchase a new outfit for their in-world avatar on the Battle Market through IBAT – Battle Infinity’s native token. This is another way to invest in the metaverse since supply and demand factors dictate each NFT’s price. Thus, as the platform’s user base grows, NFTs will naturally become scarcer and more valuable.
Besides, many NFT games enable players to purchase plots of virtual land in the form of NFTs within their world.
3. Metaverse Crypto
Metaverse crypto which describes the native tokens of metaverse-based projects is another approach to invest in the metaverse. These tokens can be used for various tasks, such as transactions, staking, and even governance.
Each metaverse’s native token can usually be used to purchase items from the in-world marketplace. We can say that sellers are compensated in metaverse crypto – which they can then exchange into another digital currency.
Crypto staking means ‘locking up’ tokens for a specific period, usually to help boost the platform’s security level. Token holders can generate a yield on their holdings on many metaverse platforms – all whilst benefitting the broader ecosystem.
We know that many metaverse projects are structured as a decentralized autonomous organization (DAO), meaning that the token holders are the ones who govern the platform. Most of the best crypto DAO projects allow token holders to vote on governance proposals, with those receiving the highest number of votes being the ones that move forward.
4. Metaverse Real Estate
Users can also invest in metaverse real estate by participating in the metaverse projects that enable users to purchase plots of virtual land. Decentraland is one of the most prominent projects that offer this functionality since its 3D world comprises roughly 90,000 plots of 16m x 16m land parcels (called LAND). People can purchase LAND (structured as an NFT) by using MANA (Decentraland’s native token) or Ethereum.
As in real life, here also plots of land are deemed according to their location. Some of the LAND parcels located near Decentraland’s ‘Genesis Plaza’ were even valued at over $13,000 in 2021.
According to an article from CNBC, virtual land sales in the metaverse topped $500 million in 2021. Not only can investors benefit from value appreciation, driven by increases in the project’s popularity, but they can also generate returns through renting.
5. Metaverse Stocks
Metaverse stocks are another best way to invest in the metaverse. Metaverse stocks appeal to investors who prefer to operate in the equity market rather than the crypto market.
The best metaverse stocks may not offer ‘direct’ exposure to the growth of a specific platform but rather exposure to the industry’s growth overall. Meta Platforms (formerly Facebook) are a great example that is deeply involved in virtual reality (VR) and the expansion of metaverse concepts.
By finding metaverse companies to invest in, it’s easy to diversify a portfolio and not be ‘overexposed’ to one particular project. Nvidia is a popular option, as the company’s chips are now used to power various metaverse projects. Naturally, as the metaverse expands and more projects require Nvidia’s chips, it will help the company’s bottom line and its share price.
So, the process of buying stocks is often much more beginner-friendly than purchasing crypto, meaning this approach may be more suited to newcomers to the market.
The best way to invest in the metaverse is the one you feel most comfortable with. Many people will get started with stocks or ETFs, as these investments don’t require a metaverse presence and you can use U.S. dollars for your purchase, rather than cryptocurrency.
But if you’re already playing, shopping and interacting in the metaverse, you may want to invest in NFTs, cryptocurrency or virtual land. Remember that it may be riskier to invest in the metaverse as it is a new concept.
Whatever your choice, if you are looking to build a diversified portfolio, it might make sense to put some of your money into digital assets in the metaverse.
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