HOW TO INVEST IN THE METAVERSE

By definition, a metaverse is a technological platform that attempts to replicate the real world (or a portion of it) in the virtual one. Large leading technology companies, social media companies and game creators are working on this concept.


Index


IntroHow to Enter in the Metaverse 5 Investment AlternativesStocksETFsCryptos NFTs

Facebook's RoleDevelopments

Diagrama de Venn sobre el Metaverso

Intro


It probably sounds like science fiction to you, but it's not so much: when we wake up, first thing, we check the mobile phone, or we turn on the computer, we meet by video call with colleagues, and we play online with people from other countries. Isn't that somehow living in the Metaverse?


The Metaverse seeks to bring all these experiences into one profile, your avatar. You may access an alternative, immersive world through virtual reality, which is why its growth has been linked to video games.


The first person to conceptualize the Metaverse was venture capital investor Matthew Ball, in January 2020. He proposed some features for the Metaverse:


  • It should be continuous and synchronous, in other words, alive.

  • It's accessible to everybody, and you may have a personalized presence.

  • Have a fully functioning economy.

  • It should enable new experiences in an interoperable way. A multitude of creators will develop it and redefine it.


Joven inmerso en Realidad Virtual

Highlights

Virtual Reality ✓

Digital ID ✓ New Economy ✓



How to Enter in the Metaverse (You are about to become an Avatar)


Choose your platform


The Metaverse is a concept that grows and mutates every day, and it is possible to access different metaverses. It will depend on what you wish to do or achieve. You may watch an NBA game live on Horizon (from Meta, that is, Facebook), meet friends at a concert like Travis Scott's in Fortnite, invest in virtual Real Estate in Decentraland or play and, at the same time, trade cryptos with programs like Axie. A PC or phone won't give you an immersive experience, but they are an option to enter the digital universe for now.

You will, then, need to choose:


  • Which Metaverse platform you will enter,

  • an eWallet to carry out transactions and also,

  • a means of communication.


1. Multiverses


As you may imagine, there has been an outbreak of companies that began offering Multiverse platforms. Among the options that we have named, there are two that stand out for their development, tenure and number of users:


  • Decentraland: It was released in 2017. It is a 3D virtual space where players walk through using customizable avatars. Decentraland's currency is called MANA; it is used to buy parcels of LAND, clothes for your avatar, and other items. Its main feature is that users can create their objects and works of art, sell them and buy them.

  • The SandBox: It started as a 2D construction game and was reimagined as a Multiverse experience. It focuses more on video games, created and monetized by the platform's users, for example, in Dungeon of Dum-Yz, where you become a warrior. Many brands like Adidas are already involved in The Sandbox.

  • Other Alternatives: You can try Axie Infinity, Star Atlas, Horizon Worlds, Zepeto, Roblox, Fortnite, and other games. The list goes on and is constantly updated.


2. eWallets


MetaMask is the most popular eWallet in the Metaverse since it installs an extension to your browser and allows apps to interact directly with your devices based on the Ethereum blockchain. Other eWallet options are Exodus, Trust Wallet, CoinBaset, and Enjin. Of course, it will depend on the Multiverse you choose and your country of residence.


3. Social Networks


It's not inherently necessary, but we recommend creating a profile on Discord. It is the most powerful communication channel in the Gamer and Metaverse communities to talk about any topic and share files. You may interact as if it was a radio with your friends, or enter specific content, organized by topic, for example, how to win a game of The SandBox.



Metaverse Hardware


If you really want an authentic experience at the Metaverse, you will need virtual reality glasses and controllers. Some of the companies that are leading the production of this hardware are the following:


  • Meta: The Oculus Quest is an excellent price/quality alternative. It is a standalone device that can run games and software wirelessly through an App on any device.

  • HTC: Although a bit pricey, HTC has developed the most advanced model. Their VR set has a tracking and mapping system that includes hand movements.

  • Sony: Was one of the first companies to get into VR in 2016 with the PlayStation headset. Launching new models every year, it differs from other consoles and is always at the forefront for the Metaverse.



How to Invest in the Metaverse


Why else would you want to enter this chaos besides playing and making money? Bloomberg estimates an 800 billion dollar market opportunity by 2024 in the Metaverse, and no investor wants to be left out of this opportunity. There are 5 basic ways to invest in financial assets related to the Metaverse:


  • Buy Shares of companies related to the Metaverse

  • Invest in an ETF of shares of related companies

  • Buy Cryptocurrencies focused on developing the Metaverse

  • Native Metaverse Cryptocurrencies

  • Invest in NFTs, the Metaverse 'stuff'


Below we present the different alternatives.



1. Buy Metaverse-Related Stocks


Many participants are developing the Metaverse, and each company is looking to jump on the bandwagon. If you are looking for a passive, medium-term investment, investing in their shares may be suitable. In just five steps, you can start trading stocks; here we present them according to their sector:


  • eCommerce companies such as Alibaba (NASDAQ:BABA), Walmart (NYSE: WMT) and Amazon (NASDAQ:AMZN).

  • Social Media companies, like META (NASDAQ:FB).

  • In VR we highlight Unity (NASDAQ:U), Hewlett Packard (NASDAQ:HPQ) or HTC Corp (TPE:2498)

  • Focused on circuit and computing technologies such as Charter Communications (NASDAQ: CHTR), Nvidia (NASDAQ: NVDA), and also, mobile operators: Verizon Wireless (NYSE: VZ) and AT&T Mobility (NASDAQ:T).

  • In the media sector, companies who fill the Metaverse with content, you already know the classics: Disney (NASDAQ: DIS), Netflix (NASDAQ: NFLX), Fox Corp (NASDAQ: FOXA), Sony (NYSE:SONY).

  • Video game developers and distributors: Activision (NASDAQ: ATVI), Electronic Arts (NASDAQ: EAU).

  • Games and virtual spaces: Tencent Holdings (HKG:0700), Microsoft (NASDAQ:MSFT), Roblox Corporation (NYSE:RBLX).



2. Invest in Metaverse-related ETFs


If you want to diversify your portfolio with exposure to the Metaverse, you can trade Exchange Traded Funds or ETFs. It is an effortless way of investing in a basket of stocks, and you can do it in just a few steps. There are endless ETFs focused on Technology; among others is the Invesco QQQ Trust ETF (QQQ): one of the most representative ETFs of the technology industry listed on Nasdaq.


There are also specific options, such as the Roundhill Ball Metaverse ETF (METV ETF). It was the first one designed to track the performance of this new industry, with exposure to companies developing essential infrastructure (such as Cloudflare), game engines (such as Unity and Roblox), and content pioneers for Meta.


Additionally, eToro features a Smart Portfolio dedicated to the Metaverse. MetaverseLife is a portfolio selected by the Broker by defined themes. In this case, it is constructed of shares and crypto assets that you can check through its platform.



3. Metaverse' Cryptos


The Metaverse requires its own way of transacting, and at this point is where structural cryptocurrencies appear. We call them structural because many games and cryptos in the Metaverse are based on a blockchain, and they need an infrastructure to allow people to interact. Decentraland, The SandBox and Axie Infinity do it on Ethereum as a base, whilst Star Atlas is based on Solana. These blockchains are on the boil, and you will find new ones every week. It is straightforward to start investing in cryptos. Here we mention the most stable projects:


  • Ethereum – Unlike Bitcoin, Ethereum was not created to be a digital currency. It is a complete platform; to simplify, let's say that it has its Internet browser, coding language and even its independent payment system. It is a decentralized network and has become the most used to develop applications (dapps) and transact non-fungible tokens (NFTs).

  • Solana – This is also a platform for decentralized finance applications and other smart contracts. Solana is Ether's biggest competitor since its transactions are faster and cheaper. We will not go into the technical details of its operation, but this crypto is among the '20s most traded and continues to grow. SOL has a higher market capitalization than other altcoins, and it is a top choice to buy NTFs.

  • Cardano: it is a public and Open Source platform and also decentralized. It is one of the most innovative technologies in this industry and has a big supporting community. For all this, its native cryptocurrency (ADA) is another top alternative.

  • Avalanche: equivalent to Cardano and Solana, it has the advantage that it can host apps developed in Ethereum, and several projects have considered migrating here due to its more affordable costs. As a result, its cryptocurrency (AVAX) grew tremendously.

  • Tetha: is another decentralized network with a focus on video streaming. It wishes to become YouTube's main competitor with blockchain technology. Uses a P2P system to take advantage of users' bandwidth and storage space.



4. Metaverse Native Cryptos


A Metaverse would be equivalent to a country with its currency, rules, laws, etc. Thus, each country/App needs a specific cryptocurrency. We can acquire them through an eWallet such as MetaMask. The most attractive due to their potential and market capitalisation are the following:


  • Mana: It is the native token in Decentraland. Decentraland, if you didn't know about it, is the closest project to a sci-fi idea of ​​a metaverse. It is an entire world built on the Ethereum network, which allows you to emulate all the real-world activities. You may buy properties, create objects, organise a concert and even vote in the community. Decentraland is one of the most solid virtual universes today, and therefore, Mana is a strong bet.

  • Sand: it is the token of The SandBox. It is a play-to-earn mobile game that works with user creations. You can design an avatar, goods, and different games within it and exchange them. In this way, the users' products are monetised NFTs, and Arena is the currency that allows these transactions. Along with Decentraland, they are the most popular Metaverses.

  • AXS: Axie Infinity is a Pokemon-type game where you collect Axies. To improve them or compete with them against other players, you need to earn rewards or buy AXS. These are the game tokens you can invest in and earn money by playing their daily quests or story mode.

  • Atlas: From the Star Atlas platform. Unlike the previous ones, it was developed in open source under the Solana network. Although the game hasn't been released yet, it's already possible to trade spaceships and land NFTs.



5. Investing in NFTs, Metaverse 'stuff'


NFTs or Non-Fungible-Tokens are digital assets. You had a photo on your computer, you copied and pasted it, and with a change of name, it was impossible to distinguish which was the original. The NFTs have come to change that, they are a digital token (like a cryptocurrency), but it certifies that something is unique and unrepeatable. Thus, a photo but also a design, an avatar or a weapon in a video game can be NFTs. Do you know where we are going with the NFT fuss?


NFTs are revolutionising the world of art collecting. Quantum was the first digital work of art certified as an NFT, to be auctioned online in 2021. But this technology opens new horizons: the CEO of Twitter, for example, sold the first tweet in history for 2.9 million dollars. In addition, to buying the elements of each Multiverse, you can also trade NFTS on platforms such as:


  • Open Sea: It is the first NFT marketplace and the largest one. Here you can buy works of art, original music, Formula 1 cards and almost every form of NFT. You transact with ETH through your eWallet.

  • Rarible: It is a decentralised market, which allows direct dealing. It charges 5% to each side of the transaction (the bid and ask). In addition, it enables the creation of NFTs.

  • Ethernity: an App focused on sports, where you will find exclusive pieces by Leo Messi or Luis Suárez.

  • Valuables: An exclusive platform for buying and selling tweet NFTs. Would you like to own that viral? Valuables is your choice then.



Facebook's transition to Meta (verse)


Mark Zuckerberg claimed that Facebook should transition from social media to a Metaverse company in five years; he believes that the Metaverse will be the evolution of the social media industry. His commitment is such that he even changed Facebook's name to Meta, it's stock listing and logo. The new stock ticker is MVRS, and it trades on the Nasdaq Exchange. The CEO also announced a $10 billion annual investment to develop Metaverse technology.


Reality Lab is its new development department devoted to producing virtual reality software and hardware. They make the Oculus Quest headsets and metaverse platforms like Horizon Worlds. With the latter's launch in the United States, Meta' Metaverse (sorry about the redundancy) finally took shape. It is his first social experience game, where you can create your avatar, inhabit different worlds and even develop games within the same platform.


Why so much interest in the Metaverse? During Meta's launch, Zuckerberg stated that Facebook emerged in the same years as mobile phones, and that is why the company did not intervene in the development of smartphones. Now he would seek to redeem himself and grow, shaping the Metaverse.


Besides Meta's moves, many companies are developing apps and hardware to jump into the virtual world. Furthermore, conceptually, the Metaverse is conceived in a decentralised manner. It does not belong to a company but implies the creation of different interconnected platforms that allow users to move from one to another, regardless of who has developed it. As with the internet itself, the Metaverse won't be something that a company can create independently.



Recent Developments


As much as the CEOs want to speed up its development, the Metaverse is still an infant. Current virtual reality tech is not yet able to duplicate the physics of real life, among many other technological barriers: A development and adoption horizon of 10 to 15 years is assumed. So, be prepared to keep your investments for a while if you want to achieve real, tangible growth. With regards to the tech barriers, here's a list:


  • How to emulate the five senses. The aim is to combine the stimuli of touch, hearing and sight to generate a credible effect for users through the available devices. The next step is haptic gloves, which will replicate the texture, hardness, and weight sensations in the Metaverse. Its goal is to make us believe that we are actually doing it when we raise a glass in the virtual environment. Some startups like Hi5, HaptX, Manus and SenseGlove have already presented their advances. Also, Meta's Reality Lab has been working on this type of glove for several years and has developed a prototype that promises to outperform them.

  • Inclusion and connectivity. Imagine the required gigabytes to do it with virtual reality if we often cannot have a video call by zoom without losing the connection.

  • The last barrier concerns the access to the necessary devices and the use of personal data: what will happen to the thousands of new cameras and sensors? Which company will handle that sensitive information, and how will you ensure that users have the control? What will happen to people who can't afford to buy the devices?


As you can see, there is still a long way to go.

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