If you follow anything in crypto, you might have heard the word Metaverse a thousand times this 2021. Looks like it’s suddenly everywhere, ready to take over the world. Everybody is excited, projects are getting millions in funding, and newspapers can’t stop talking about it.
Yet, the more you explore, the less you understand. Does anyone know what metaverse is at all?
This guide will help you tell the truth from the hype, what it affects crypto, and how you can invest in it.
What Is Metaverse?
Defining the metaverse can be as abstract as defining the Internet. But before a visual explanation, here’s the formal definition:
It’s a virtual space generated by computers where people can interact with each other. Socialize, trade, play, learn, and work. It’s a decentralized environment that connects millions of platforms.
Your idea of the metaverse might be some complex tech involving VR headsets. But in practice, it’s as simple as the Internet. And to call the metaverse a VR device is likely calling the Internet a computer.
So how are they both different in practice?
How Real Is It?
Some define Metaverse as a 3D version of the Internet. That’s nothing new, as video games have been around for decades. But how are 3D environments connected to reality?
The same question applies to games like Axie Infinity or the Sandbox. How are such projects connected to each other? The bases of the metaverse are crypto blockchains.
Specifically, Ethereum, Polygon, and Binance Smart Chain. Any network that supports app development and smart contracts. Each blockchain would make a metaverse, which can still connect to each other with network bridges (e.g., the Wormhole app).
These networks are the link between the traditional economy and decentralized finance, which includes decentralized apps, games, and NFTs.
Hence how virtual assets can turn into real value.
How Metaverse Works
How you interact with the metaverse depends on the project. One platform might be a play-to-earn game, another could be a marketplace, or in the case of Facebook Meta, a VR headset. Different ways to enter it:
- Sign up for a platform
- Connect a WEB3 wallet
- Use a VR device
- Own an NFT
- Use an app in a specific location (AKA Augmented Reality)
You might say the Metaverse is already here. We’re experiencing it, just not in its full expression. It’s only going to get better as it gains more adoption, if not become more useful than the Internet.
Metaverse For The Brands
The Metaverse is inevitable because blockchain has created new business opportunities. Both for giants like Meta and studios like The Sandbox. The biggest opportunities come from the 3D version of the Metaverse (VR), which is why brands like Microsoft are developing holograms and VR tech.
VR to potentially affect every sector. For example:
Walk into a clothing store VS visit an online shop VS connect to a virtual shop.
This “virtual shop” would be the closest experience to the real one. So you can find which items you want without ever having to visit it. You then order online and receive them at home.
Other examples include:
- Virtual tours for travel agencies and real estate
- MMO Video Game environments
- 3D Meetings & Videos (like YouTube) for Communications
- Stores for virtual commerce
- Financial services for this new economy
Metaverse For The People
All these services would directly involve people, all at once, from everywhere (AKA decentralized). So you might do all the mentioned examples (like on the Internet) while Interacting with other users. Instead of an avatar picture or a chat box, it would be 99% identical to human interaction.
And all you need to access the metaverse is an internet connection, and maybe a VR device in the future (5–10 years). Once inside, you can create your virtual life to add (not replace!) to your real life:
- Make money by designing, coding, gaming
- Meet people you wouldn’t be able to meet otherwise
- Win virtual items (NFTs) to gain real-life perks on your favorite brands
- Experience most of the real world without leaving your home (if you want)
- Or create an imaginary one with immersive video games
For example, Sandbox released its alpha a few days ago:
Metaverse For The Investors
Investors should only invest in what they understand. Hopefully, by now, you know better what the metaverse means. And how you can be part of it, either as a professional, consumer, or investor.
Investing is as simple as buying the Metaverse cryptocurrencies (but there’s more into it). To get an idea of its potential, look no further than November 2021. Also known as the metaverse crypto boom, where 5x-10x gains are lowball (SAND, MANA, GALA).
And unlike the 2018 BTC bubble, the floor prices maintain.
Luckily for you, the best projects don’t even exist yet (consider the progress so far equivalent to gaming in 1975). You have time to learn before they become the next Illuvium.
How To Invest In The Metaverse
Three ways to become a metaverse investor:
- Buy coins or stocks from metaverse-related companies
- Own virtual assets (NFTs) for their resale value
- Own virtual assets as an income stream
No matter how complex it gets, all economies in metaverse platforms require cryptocurrencies. Each project might have its utility token, but they’re still influenced by the network token. So you want to watch both.
For example, the Ethereum Network hosts the Illuvium game (with its ILV tokens). ILV might go up or down, but the ETH price also influences it.
Investing in crypto requires market research. Investing in metaverse tokens, however, requires learning about the project. Your profits will be relative to the platform’s updates, and how quickly it grows its community.
If you don’t know where to start, some safe bets would be:
- The Sandbox (SAND), a Minecraft-Roblox hybrid that implements NFTs
- Decentraland (MANA) runs similar to Sandbox, with more focus on virtual land marketplaces
- Enjin.io (ENJ) wants to become the leading launchpad for upcoming games
- Ultra (UOS) allows anyone to run their own virtual trading platform
- Vulcan Forged (PYR) is a game studio and NFT marketplace
To mention another few: Alien Worlds (TLM), Good Games Guild (GGG), Axie Infinity (AXS), Atari (ATRI), and UFO Gaming (UFO).
Virtual Land NFTs
NFTs become valuable as the projects behind them gain relevance. As limited digital assets, their scarcity increases with every user that joins the community. It also appreciates as new land generates (since you own the first one).
Virtual land is one of the many applications of NFTs.
The investing strategy is the same: own the item and wait until its resale value increases. But unlike crypto trading, NFTs are illiquid. Rather than a buy/sell button, you have to manually set it up:
- Get the NFT
- List the NFT
- Wait until you get an offer
- Reject or accept the offer
It costs network fees to buy and list NFTs, which others also pay when buying from you. But imagine what you can do in a sandbox game by owning land. For businesses, that’s an opportunity to advertise in virtual spaces (visited by thousands of daily players).
Perhaps you turn that land into a marketplace. And for every sale others make, you earn a brokerage fee. Also known as NFT yield.
NFTs started as subjective as art can be. Now, we’re seeing more applications pointing to more intrinsic value, such as passive income. Once you buy an NFT, you might get daily rewards on the native token.
How long would you hold a seemingly worthless picture that adds a daily $100 to your wallet? Probably forever. And that’s one way NFT projects invest in their communities.
And it’s proven successful, even with $0 mint prices. For example:
- NeoTokyo Identities were free-to-mint NFTs. Users generate passive crypto in BYTES (~$120 each), which can be traded inside the project (for services) and out of it (such as selling for USDT). That causes most owners to never sell, which puts the floor price around 28ETH (Or 80ETH+ for the full set. Again, free to mint, but limited amounts.).
- CyberKongz yields 10 native tokens (~$0.50 per $BANANA) per day to NFT holders. Users can also spend tokens to upgrade their NFT’s rarity. Turning a 4ETH Kong into a 10ETH one (although not guaranteed).
- Sidus Heroes is another game launchpad (and studio) with DeFi features included. Owners get 30% of all profits on future NFT sales, along with staking rewards in the Binance Smart Chain.
Why Metaverse Is The Future
As new platforms join the metaverse, its definition will become broader and broader. Only those who understand its implications can make the most out of it. Whether you’re a business, gamer, or crypto trader.
Many still fear that the Internet is taking over the world. Now, the Metaverse is taking over the Internet. Could this time be different?
Q: What Is Metaverse Facebook?
From 2021, Facebook has a new vision: to create a metaverse for people to connect, find communities, and run businesses. Because of this shift, it rebranded to Meta.
Meta owns technologies such as Novi, Oculus, Portal, Messenger, and Instagram. All for one goal: to create an augmented experience of reality. Presence, teleporting, customization, to mention a few.
Meta takes everything explained in this guide and commits to making it a reality.
Facebook still exists, but instead as an app owned by Meta.
Q: When Is Metaverse Coming Out?
If you mean the minimum-viable version of the metaverse, it’s already happening. It’s the Internet, crypto, and everything in between. Specifically, during the expansion of DeFi in 2020.
If you mean the VR-version of the metaverse, each company will take its time to develop. For games like Axie Infinity, Forest Knight, or Illuvium, 2–3 years. For AAA games like WOW, GTA5, or Star Wars, give it 5 to 10 years (the average production time based on team size).
As for virtual reality for real estate/shopping/traveling, ~5 years is reasonable. Less than three if you’re Microsoft.
Until late 2025, you won’t see noticeable changes in everyday life.
Q: To What Point Will Metaverse Replace Reality?
No, Metaverse won’t replace reality: it will make some of its parts optional. And unlike the Internet, this trend relies on Virtual and Augmented Reality. People will be more connected than today online, just differently.
However, technology does seem to replace reality gradually.
When the television came out, it made communication easier. When the Internet went mainstream, it also solved many problems. It didn’t replace the real world, but it changed people’s lives forever (hopefully for the better). When the metaverse does the same, where to focus will be an individual choice.
You can use the metaverse at the service of your real life. Or you can build your life in whichever reality you prefer. Whether you want to experience this or not, you can benefit as an investor.
Q: What Can We Expect in the Next 5–10 Years?
Well, the Internet became functional in ~1980, and it took 20 years to expand around the world. Had Steve Jobs not launched the iPhone, we might have had to wait for another ten. Since the metaverse is bigger than the Internet, what can you expect in the next ten years?
Luckily, VR has existed for around two decades. It would be far off to expect a functional metaverse before 2030. That’s when everyday people might use it the way we use our phones.
As for investors?
You don’t need to wait years when there are promising projects already. Many are in development with inactive coin prices. You have months (if not years) to find about them before they complete and go exponential.
There isn’t much new to see in the 2D metaverse. It’s the VR version that requires development.
Q: Everyone Is Talking About It. Is It Too Late to Get In?
Some early projects have already gone parabolic. Others are sleeping, and it’s a matter of time they gather attention (look at Sandbox one year ago). But most of them don’t exist yet.
It’s not late. And it’s not going away. So whether it’s late or not, investors will have to consider the metaverse sooner or later.
If you want to be early, follow the space. Game studios (e.g., Decentraland), launchpads (Seedify), and social media platforms. That’s where most projects start.