Is the Metaverse Technology investment-worthy?

By definition, a Metaverse means a virtual-reality space in which users can interact with other users in a computer-generated environment. It sounds simple enough, and perhaps we have been doing this all along since the launch of the internet. However, there is a lot of hype around Metaverse right now.

The future of the internet includes virtual worlds where people can engage without physical space barriers. And this is the age of the Metaverse. Many believe these virtual environments are the next big investment opportunity. Even though the Metaverse is continuously evolving, it can directly impact how we enable social media engagements, practice e-commerce, or even buy real estate.

In this guide to Metaverse, we aim to help you better understand the technology and how one can profit from it in the future.

As more and more people engage in these virtual environments, the investments of larger corporations in this technology increases. Facebook has now declared itself a 'Metaverse company' and plans to invest a lot in its ambition to build the Metaverse.

What is Metaverse technology?

In the last few years, internet technology has completely changed how we experience the world around us, with revolutions like unlimited access to information and social media advancements. How will it evolve now?

More tech companies are developing virtual environments given more significant technological advancements like machine learning and AI, better computing power and faster internet connectivity. These virtual spaces give participants a sense of being present without physically leaving the place. By using holograms, technology companies promise to give people the opportunity to do almost anything without any physical barriers.

People can find themselves as avatars of the virtual environments and can effectively play, shop, work, learn, and experience any life activity in the future digital world. For example, a teacher could take students to Niagara Falls or learn about space through augmented reality.

What does Metaverse look like right now?

To define Metaverse to what it will be in the future, one would need to explain it as what it is at present. We already have a multi-player online presence from participants anywhere globally in the form of virtual gaming worlds, video calls like zoom, online avatars, and e-commerce platforms. So further, what will be new here?

A combination of VR (virtual reality) and AR (augmented reality) worlds where everyone can work, play and shop while using more technology like holograms, VR setups and heads-up displays. Many movies and novels would serve as an imaginative reference point for the Metaverse.

How does one invest in these virtual worlds?

It isn't easy to judge when and how quickly will the Metaverse technology catch on. Many experts think it is already happening and will soon evolve and get better with everyone deploying it.

More Cloud companies are investing billions into their current infrastructure. All back-end support, whether computer power is needed to create virtual worlds, microchips and processors required for speed and data storage in cloud technology, are all extremely valuable even today. And these sectors have done phenomenally over the past few years and will continue to grow with Metaverse.

Companies spend billions to prepare for the Metaverse, even on product development. Facebook already established their stand on the Meta universe with the name change announcement. Apple is bringing out its new headset later this year. Roblox is getting more kids involved in creating new games and allowing other users to access others' games.

There is a rise of several smaller companies investing in the technology supporting their Metaverse vision. So from what can be seen, there has been a clear pathway to building infrastructure around Metaverse and VR/AR.

We now know that virtual reality is not a new concept. Many companies such as Decentraland, Nintendo, Roblox and Sandbox have been operating in this space for a long time. And most of these corporations, which started as gaming companies, have millions of users combined.

The stakes are very high for big tech companies like Microsoft, Meta (FB), and Apple. They wish to combine these internet using gaming, social media and other communities into one unified Metaverse.

Grayscale, an Investment firm, estimates that global revenue from virtual gaming could surpass $400 billion by 2025 from $180 billion today, which is a substantial increase of over 122 per cent.

The future will see a rise in digital currencies like cryptocurrencies that will help to virtually trade goods in the metaverse economy. It will also allow users to own digital assets like non-fungible tokens (NFTs), trade them and use them in other digital experiences. Thus, creating an entirely new digital economy that can be monetized in the physical world.

Digital is the future for even other non-technology product companies that hope to engage with their clients through this space—like Nike announced in December 2021 an expansion of its digital footprint by acquiring a virtual sneaker company. Many brands like Gucci, Givenchy, D&G, Adidas, among others, have held virtual fashion shows using metaverse technology.

Even artists like Ariana Grande have performed virtual concerts attracting millions of fans from all over the world. The metaverse economy is now opening up new investments in real estate too. Some investors have spent millions of dollars buying digital land on the metaverse platforms.

How can I invest today?

There is a good chance you already have some exposure for individual investors who reside in the US, as many US public companies are already participating and continue to invest in this technology actively.

Microsoft recently acquired Activision Blizzard for $68.7 billion, which is considered the most prominent gaming deal ever. Other public companies like NVIDIA are looking to directly benefit from the growth of the Metaverse as its leading service is to power computer graphics. Other companies such as Autodesk and Unity Software, software makers that allow architects and designers to create 3D models, will get big with the rise of Metaverse.

We already know about many investors having active investments in cryptocurrencies, NFTs, and other digital assets and currencies that are a significant part of the metaverse ecosystem.

However lucrative the future looks, many of these investments carry more significant risks and too much volatility than traditional stocks and investments. So thorough research and evaluation of your risk tolerance is always your best bet before investing. Sticking to a diversified portfolio with good investment guidance and insurance is always a smart way to go.

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