The metaverse is growing and it doesn’t look like it’s going to stop anytime soon. According to some studies it has multibillion-dollar investment opportunity potential. For example, like CITI’s latest study in which it indicates that the total metaverse market could be between $8 trillion and $13 trillion by 2030, with total metaverse users of about 5 billion.
The metaverse has also transformed the economy in two ways: first, by providing an alternative investment tool via blockchain and second, by opening up new asset classes. All of this translates into a bullish environment with moderate to high risk appetite.
Is it possible to invest in the metaverse?
The answer is a resounding YES, without this being investment advice. The blockchain metaverse refers to a decentralized, immersive universe with a blockchain-based economic (DeFi and NFT) and governance system (often referred to as a decentralized autonomous organization or DAO).
This means that for a decentralized metaverse to work, in addition to bringing value and a differential user experience, users must have an investor stake.
Why should you invest in the metaverse?
The first reason to consider the potential of the metaverse as a suitable platform for investments is the association with blockchain and crypto. Smart contracts and NFTs are critical components of the metaverse, as they are essential for the purchase of assets and the exchange of assets between different virtual spaces in the metaverse. Aspiring metaverse investors should note that NFTs and metaverse cryptocurrencies offer ideal instruments for investing in the different metaverse platforms.
In addition, virtual real estate transactions on metaverse platforms such as Decentraland and Sandbox show the potential for metaverse growth in the future. Furthermore, Goldman Sachs has estimated the market opportunity associated with the metaverse to be around $1 trillion. Considering the huge potential associated with the metaverse, many of the leading companies in the technology world have started exploring the possibilities of investing in the metaverse.
How to invest in the metaverse?
The good news is that investments in the metaverse are democratic in nature. Anyone can buy native tokens or digital assets with no minimum entry threshold.
Unlike real-world economies, there are no geographic barriers and you can invest in blockchain metaverse in any region. Below are the options available when investing in the metaverse.
Buying native metaverse tokens.
Buying tokens is one of the easiest ways to invest in the metaverse. All you need is a digital wallet to host crypto tokens and interact on a cryptocurrency and token exchange platform. Leading Metaverse tokens are found on almost every exchange platform, including Decentraland’s MANA, The Sandbox’s SAND, Bloktopia’s BLOK APE from Bored Ape Yacht Club and Axie Infinity’s AXS.
CoinMarketCap Metaverse Token list
On crypto market tracking sites like CoinMarketCap or CoinGecko, it is possible to easily filter the 13000+ cryptocurrencies by Metaverse and find where they are listed.
Obviously, it is not as simple as just buying and that’s it, it is necessary to establish your investment strategy and keep in mind the volatility of the market. Therefore, metaverse investors have to take the risk of price uncertainty by buying metaverse tokens as an investment opportunity.
Acquiring land in the metaverse
Purchasing land is perhaps the most talked about among the ways to invest in the metaverse, and it requires the same purchase requirements as cryptocurrencies. Once you have your wallet ready with balance, select to study Metaverse projects and focus on finding the best plot or land to acquire, taking into account availability, layout, size and cost.
The process is relatively simple, but involves more risk than cryptocurrency investments, as the value of virtual land depends on a number of factors how we value conventional real estate. In general, the value of real estate is determined by supply and demand. Supply is more or less fixed, and demand is based on tangible and intangible factors. These include, location, population and demographics, property size and characteristics, aesthetics, economic prospects and investment potential. Proximity to attractions and teleporters adds value, and celebrated neighbors can drive street prices.
As the Metaverse evolves, we are likely to see an increase in virtual real estate services. Metaverse Property bills itself as “the world’s first virtual real estate company,” offering property management, development, consulting and marketing services.
Renting or buying prefabricated buildings from the metaverse.
Instead of buying land, prefabricated structures that can be put to use directly can also be purchased outright. For example, an individual or company could purchase a virtual storefront and then use that space to display 3D digital replicas of their real-world offerings in the metaverse.
This method of investment applies to a wide range of industries, from retail to arts and entertainment services. However, there are significant barriers to entry, as the minimum investment threshold is quite high. You have to buy a moderately large space to really generate value in the metaverse using this method.
Creating, buying and selling NFTs
The next, and possibly the most flexible way to invest in the metaverse is through non-fungible tokens (NFTs). Buy NFTs and sell them for a profit, which is a simpler approach. These NFTs can be in-game assets of the Metaverse, such as avatars, clothing, houses, cars, trees… Any digital asset that allows the user to give free rein to his imagination to create in the land he acquired or to dress or complement his avatar.
On the other hand, you can also create these NFTs and put them for sale in the metaverse markets, which is a technically difficult process, since it requires programming knowledge, although large platforms such as Decentraland and The SandBox have developed tools to create these assets in a very simple and intuitive way.
Selling or renting experiences
A curious way among the possibilities for investing in blockchain metaverse focuses on the experiences offered to users. It seems silly, but in reality, the metaverse that offers the best experiences is the one that will attract the largest community; therefore, the creator of those experiences will be well remunerated for it. You can customize virtual plots and rent the virtual spaces for businesses or offices. In addition, you can rent billboards in metaverse properties for advertisements as a feasible investment opportunity in the metaverse. Other relevant success stories include creating music events, which can be accessed by purchasing a ticket in NFT (POAP – Proof of Attendance Protocol) format, such as the Snoop Dogg concert at The SandBox.
Investments in the metaverse index
Now I am going to explain how to invest in the metaverse indirectly. It is nothing stranger than the Metaverse Indices or MVI. MVI works on a portfolio of different tokens of major projects in the virtual universe. One of the advantages of choosing MVI as a method of exposure to the Metaverse is that it slightly reduces volatility by working on a set of crypto assets from different projects. Examples of Metaverse indices are those available in TokenSets or Index.
Metaverse Token basket within TokenSets Metaverse Index
Surely there is a lack of investment options in the metaverse and new ones will surely appear in the future, but I have shared the most common ones at the moment. With a wallet with balance, you can buy tokens of the main metaverse projects, NFTs in-game virtual plots. In addition to being able to monetize in different ways those lands or invest through indirect methods.
At Belobaba we strongly believe in metaverse promising growth potential, it is still in its infancy. Therefore, before investing your capital, invest time in studying the different projects. The devil is in the details!