Imagine yourself in 1492. You are Christopher Columbus. You have arrived in countries that were previously unexplored by Europeans. Amazed, you can only imagine all the possibilities that open up before you. Well, we are exactly in this situation in 2022, with an infinitely larger world, the metaverse. You’re probably wondering how to invest in the metaverse without drowning in the mass of information. Coinpri explains it all in this guide: let’s navigate together through the metaverse and its advantageous investments.
- What is the metaverse?
- How to invest in metaverse: why are big brands interested?
- But then, how to invest in Metaverse?
- How to invest in Metaverse with stocks instead of crypto?
- How to invest in Metaverse with play to earn (P2E) games?
- Decentraland, the decentralized reference for investing in the metaverse
- Other interesting projects to invest in the metaverse
- How to invest in metaverse, 7 tips to be a better investor
Disclaimer: This article does not constitute investment advice or an invitation to invest. It is strictly for informational purposes only. You are solely responsible for the trading and investment decisions you make.
What is the metaverse?
As you know, you don’t invest in something you don’t understand. So before we look to invest in the metaverse, let’s first try to understand what it is. The metaverse is not just digital land, it is much more complex than that.
We can try to summarize it as follows: it is a digital world at the confluence of the Blockchain, social networks, augmented reality (AR), and virtual reality (VR).
We enter this digital world through an avatar (digital representation of ourselves) that we use to play around with our environment. This is a key component of the future of the Internet: the famous web3. A much more immersive Internet in short.
Despite the hot news about the metaverse (#Meta), the idea is not new. Let’s roll up our sleeves and do a little archaeology.
The term appeared for the first time in 1992 under the pen of Neal Stephenson in his book Snow Crash. In this cyberpunk novel, the SF author describes this world as follows:
“People are software called avatars. They are the audiovisual bodies that people use to communicate with each other in the Metaverse.”
In 2003, the famous game Second Life was born. It is this platform that really democratized the concept of metaverse. At its peak, it had 11 million “residents” and 50,000 companies. Yes, you read that right. Companies. And not the least: IBM, the Caisse d’épargne and many others! A real digital economy already existed. And people became millionaires thanks to this game.
It is important to keep in mind that we are talking about the beginnings of the metaverse, which was still in its infancy. But then, you might be asking yourself: why should I invest a single kopeck in this digital universe?
How to invest in metaverse: why are big brands interested?
Digitization, blockchain and the metaverse: the ultimate combo
It’s a fact: the economy is going digital at a rapid pace. Just look at the evolution of ICT (Information and Communication Technology) adoption, especially in Africa and Asia. A huge market is opening up in terms of new technologies (AI, deep learning, …). And among these new technologies is the Blockchain!
Blockchain is growing rapidly, whether for crypto or NFT. But we are still far from reaching its full potential.
In France, for example, 8% of French people own crypto. There is still 92% to conquer. We are still only at the beginning of the curve below.
Digitization of the economy, gradual adoption of the Blockchain… No wonder the metaverse is starting to make news. And the big investors have understood it.
Experts predict that the size of this market will reach $800 billion by 2024. Start-ups are being built that will become the giants of tomorrow.
The metaverse is supported by large investment funds, such as Sequoia Capital or Boost VC. It is not for nothing that Mark Zuckerberg‘s company renamed itself Meta and is investing billions of dollars in the metaverse.
A new sales channel and a powerful advertising tool
For some brands (especially luxury brands), being present in the metaverse will be a necessity. Indeed, the future of advertising and marketing will be partly played out on the metaverse, and there is a huge market to take. Many commercials will be able to be displayed in this world. More and more people will go through the metaverse to make their purchases. Landowners will be able to put their advertising space up for rent.
But then, how to invest in Metaverse?
Buying crypto in the metaverse
To invest in the metaverse, you can simply buy cryptocurrency. To do this, you need to go through an exchange platform like Binance, Kraken, Etoro or even Coinbase. Once you have obtained your tokens, you can store them in your wallet (digital wallet) like Metamask. Below are the best projects to invest in.
The best known marketplace for this is Opensea. Most of the NFTs available on this marketplace are deployed on the Ethereum Blockchain (ETH). It will be possible to buy accessories or skin like in Fortnite.
By buying them at the right time, you will be able to resell them at a higher price and make a profit. These profits can be reinvested, to buy a limited edition clothing for example.
Buying land for resale or rent
Real estate is a key component of the metaverse. Investing in land is a good idea to diversify your income sources.
With this kind of investment, you won’t even need to build or bring in construction specialists. You can become a web3 real estate agent and it can be very profitable.
Since land is not infinite, you must buy it before it sells out, or wait for the right time to buy it on the secondary market.
You will then have to define the price of your tenants’ rents according to the returns you are aiming for.
Then get comfortable while you wait for your monthly income (payments in USD or in the metaverse currencies).
If you are a bit creative, you can also increase the value of your property by creating facilities on it or promoting it.
When you are fully satisfied with the results or thinking about investing elsewhere, you can simply move on to the “resale” stage like any other perfect real estate investor.
Investing your time to make money
Finally, if you don’t have the means to invest money directly in the metaverse, you can always invest your time.
Organize events and invite people to get visibility. Create your business and monetize your creations by creating your own NFTs.
How to invest in Metaverse with stocks instead of crypto?
We remind you one last time: this article is not an investment advice nor an incentive to invest. It is strictly an informative article.
If you are a trader with a preference for the stock market because of more liquidity, less volatility and you like to feel like a shareholder when you get your dividends, this section is for you.
How to invest in metaverse with Nvidia, the graphics card and chip manufacturer
Nvidia is one of the world leaders in graphics cards (GPUs). They are used in PCs, game consoles, … The stock price has risen to $329 in November 2021 from just $32 in December 2018 and $3.20 in March 2013. The stock has increased x100 times in eight years.
Why? Simply because its products are essential due to the digitalization of the economy. Moreover, the company recently launched its Omnivores Enterprise software.
Unity Software: the reference software for creating a metaverse
Unity Software has a leading position in 3D software (about 50% of the market). Most video games are developed on the Unity Software platform.
This platform allows developers to create a world easily and quickly. As the metaverse develops, creators will use these services.
Roblox Corp, a staple in metaverses
Roblox was founded in 2004 but the IPO was made in 2021. Yet it is a promising company if you want to invest in the metaverse on the stock market.
Indeed, the platform has 45 million daily active users. The Robux, the game’s currency, allows you to buy digital objects.
Above all, the platform allows anyone to create their own game for free. Concerts have even been organized, with stars like Lil N’as X!
Meta Platforms: the giant arrives with the Oculus
Meta Platforms alone has $50 billion in cash and several billion monthly active users on Facebook, Whatsapp and Instagram.
In 2014, Oculus (the VR mask maker) was bought by Mark Zuckerberg for $2 billion.
In 2021, this one launched a first public version of the Horizon Workrooms application, which works with the Oculus. These accessories will be mandatory to immerse yourself in the metaverse, so it may be interesting to invest in the stock on this company.
ETFs to invest in the metaverse
Finally, it is possible to invest in ETFs (Exchange Traded Funds). ETFs are index funds listed on the stock exchange.
They are historically managed by institutional investors (banks, pension funds, …) but private investors have started to invest in them in recent years.
ETFs are made up of shares of major companies in the sector. So, instead of betting on one company, you bet on several, which allows you to diversify your investment and have a better risk management.
How to invest in Metaverse with play to earn (P2E) games?
The Sandbox, the best metaverse of 2022 to invest in
The Sandbox is a game developed from 2011, primarily for mobile. In 2018, the co-founders (Arthur Madrid and Sébastien Borget) decided to take the turn towards Blockchain and oriented their game towards the metaverse.
This play-to-earn (P2E) game, based on NFT, allows players to truly own their creations, objects and lands.
They can trade them on a marketplace and make money from them. Many celebrities are starting to take an interest, such as Paris Hilton.
To buy SAND (utility token), just go to an exchange platform like Binance, FTX, Coinbase or Kraken. You can also buy LANDS on Opensea or Rarible (there are exactly 166,464 land plots).
Decentraland, the decentralized reference for investing in the metaverse
Decentraland is a blockchain game built on Ethereum. The idea was born in 2015 but it took 2 years of development.
In August 2017, the ICO (Initial Coin Offering) raised 86,000 ETH ($25 million at the time), in just… 30 seconds.
The native cryptocurrency of the game is called MANA (it is an ERC-20 token). MANAs are used to buy all kinds of things, including virtual land (it is also possible to rent it). As the name suggests, the game is decentralized, which means that the platform is managed by its users. Thus, everything that is built by the users is the exclusive property of the creators, the Decentraland team has no rights on it.
It is possible to buy MANA on the main trading platforms (mentioned above).
Other interesting projects to invest in the metaverse
Pavia, an interesting metaverse on the Cardano blockchain
The Sandbox and Decentraland are currently among the strongest projects on the market, but there are others that are equally promising. Among them, we find for example Pavia.
Pavia is a metaverse game built on the Cardano blockchain. The game has not been released yet, but the plots (which you can buy here) have been selling out quickly as you can see below.
OVR, investing in the real world metaverse!
Another interesting project is OVR (Over the Reality), built on Ethereum. This project aims to be a metaverse of the real world, nothing less.
It’s a real representation of the world, cut into an infinite number of parcels (1600 billion OVR lands), which you can buy.
So you can own a real part of the world, a monument like the Eiffel Tower, for example.
They chose to implement on a smartphone, not via a VR headset, simply to facilitate mass adoption.
How to invest in metaverse, 7 tips to be a better investor
As said in the introduction and in the reminder, we don’t do investment advice at Coinpri. We will never, ever, tell you to invest in this or that crypto or NFT.
You are the only ones in charge of your investment decisions. Nevertheless, here is a list of 7 tips to help you invest better in the metaverse.
Tips n°1: Take a walk before you buy
Before rushing to buy a piece of land, create an account with an avatar and walk around the world (and it’s free!). You can see if you really want to invest your money in this or that world. If you like it, and if you find an interest in it, then you can go there with peace of mind.
Tips n°2: Only invest what you are ready to lose
I hope that it would not occur to you to sell your physical house to buy a land or a house in the metaverse! Or to open an account with a broker to borrow against your life insurance and leverage a metaverse investment!
Invest money you can afford to lose and never succumb to the temptation of debt: this should be your credo. Indeed, if it is true that the capital gains can be much more interesting than the Livret A, you are never safe from a crash that will destroy your investment and your assets. So never go all-in on an investment as risky and speculative as this one: invest intelligently.
Tips n°3: Start by investing your time rather than your money
As you know, you don’t invest in something you don’t understand. If the world of Blockchain is still unclear to you, it is probably better to invest your time in understanding this technology, to be able to step back from the news to understand the market. This will only serve you in the long run. Why invest money when you can invest time and money to understand?
Tips n°4: Do a market study
If you plan to invest, study real estate prices, just as you would in the real world. Take several indicators to get the best idea of the fair price of the asset and its upside potential. Make calculations, looking at the cost/benefit ratio each time. You should not hesitate to invest your time in research before investing your money.
Tips n°5: Choose the location first
As in real estate, the location is the most important, you should never work on the spur of the moment. You must always think in terms of return. Is the plot of land frequented? Is it near a strategic location? For example, user Andie Sparkle didn’t hesitate to spend 70,900 SAND ($458,000) to be Snoop Dogg‘s neighbor!
Tips n°6: Invest at the right time, no FOMO
FOMO is the Fear of Missing Out, which means compulsive investment for fear of missing an opportunity. It affects all of us, even the most experienced.
Tips n°7: Secure your assets
That’s it, you’ve finally bought your first piece of land in the metaverse. You’ve studied the market and you’re sure of your move.
A few months later, you notice that the price has been multiplied by 4! You rush to connect your wallet and sell your NFT to make a profit. But… Unfortunately. You have nothing left. You have nothing. Nada. Everything is gone.
The reason? You didn’t secure your wallet enough. Don’t worry, we’ll explain you how to do it in a future guide.
I hope you’ve enjoyed this article and that it has helped you to better understand how to invest in the metaverse. One thing is certain: the metaverse is here to stay, whether we like it or not. Its short-term future is still uncertain, as it is a new technology, but the medium-term opportunities are there. It’s up to you to seize them. Don’t worry, in a future guide, we will give you the 10 best tools to invest in NFT. Stay coinnected 😉
Coming from a teaching background, I’ve become passionate about the world of Blockchain. I’m eager to learn more and share the fruit of my research through my articles.