Metaverse is a virtual reality platform with significant future potential. The future of the Internet includes a virtual world where people can interact without the constraints of physical space. Analysts estimate that these virtual environments could be the next big investment opportunity. Metaverse is still evolving, but the technology could revolutionize everything from e-commerce to social media and even real estate. As the audience for these virtual environments grows, so does the interest of businesses to capitalize on this trend. Facebook, for example, plans to change its name to "Meta" (FB) and invest billions of dollars in its metaverse ambitions. This article aims to help you better understand what Metaverse is and how you can benefit from this technology.
Is investing in the metaverse a good idea?
It is important to note that virtual worlds are not new. Companies such as XANA Virtual World, Decentraland, The Sandbox, and Roblox (RBLX) have been using the virtual reality space for many years. Together, these companies attract millions of users. However, large tech companies trying to unify these disparate communities into a single metaverse are at a significant risk. And they hope to risk billions of dollars for that. Investment firm Grayscale, for example, estimates that by 2025, global virtual gaming revenue will exceed $400 billion, a 122% increase from the current $180 billion.
And many large corporations start to interfere. Sotheby's Museum of Art (BID) announced that NFT sales reached $100 million last year. Decentraland also launched Sotheby's Metaverse, a new virtual gallery where visitors can view affordable digital art. Similarly, Nike announced in December 2021 that it would expand its digital footprint by acquiring virtual sneaker company RTFKT. Other fashion brands such as Gucci, Givenchy, Dolce & Adidas and Gabbana also held virtual fashion shows on Metaverse.
Metaverse's economy opens up new opportunities for real estate investment as well. Some investors are interested in paying millions for “real estate” on Metaverse platforms like Virtual World XANA to live next to celebrities like rapper Snoop Dogg. Similarly, pop artists like Ariana Grande and Lil Nas X have hosted virtual concerts on the metaverse, attracting millions of fans around the world.
How do I invest in Metaverse?
Many individual investors will already have some understanding of the metaverse. Many of the US publicly traded companies are already involved in the technology or are actively seeking investment. Microsoft (MSFT) recently announced plans to acquire Activision Blizzard for $68.7 billion in the largest gaming deal in history. They also bet a huge amount on metaverse expansion. “Games are the most exciting and dynamic entertainment category on any platform today, and will play an important role in the evolution of the metaverse. Other public companies such as
computer graphics company NVIDIA could benefit from the growth of their virtual reality platform. Similarly, Autodesk (ADSK) and Unity Software (U) are software manufacturers that enable architects and designers to create 3D models. Cloud technology provider Fastly (FSLY) is also a leader in this space. The Round Hill Ball Metaverse ETF (META) provides an efficient and easy way to invest in specific Metaverse stocks for those looking for a broader range. The fund has approximately $900 million in assets under management and an expense ratio of 0.75%.
