How to Invest in the Metaverse

Late last year there was a huge burst of interest in the metaverse, prices for anything metaverse-related pumped for a while, and everyone was trying to figure out how to invest in the metaverse.

Since then, interest has cooled off with the bear market, but that doesn’t mean developers stopped building. The meta-narrative didn’t have time to run its course, and if the metaverse is to become a real (virtual) thing then there should be plenty more future hype.

What is the Metaverse?

In short, metaverse projects are building immersive virtual worlds where you can socialize, play games and transact. These worlds might eventually interconnect, decentralization is key, and a joined-up metaverse could potentially take in everything we do online today.

Crypto and NFTs are central to metaverse development, allowing users to own and trade digital property.

What are the Big Projects?

Image credits: Decentraland

It’s open to debate, but at the moment, three major projects garner the most attention:

• The Sandbox
• Decentraland
• Otherside by Yuga Labs.

The Sandbox is a successful gaming product that has been around since 2012, and switched over to blockchain development in 2018.

Decentraland raised money through an ICO in 2017, pulling in about $26 million in ETH, and it has been busy in development since then.

Otherside is building out from the success of Bored Ape Yacht Club, which launched in 2021. Yuga Labs (creators of BAYC) has grown into a major player in the crypto world, going from JPEG creators to metaverse builders in the space of a year.

In all of these projects, you can invest and participate by purchasing virtual land and other items in the form of NFTs, along with each ecosystem’s native tokens.

Must Read: The Sandbox vs Decentraland – Everything you need to know about the developing metaverse!

How to Buy Metaverse Land

Image credits: The Sandbox

Visit The Sandbox dedicated marketplace to purchase land and other NFT assets, or buy on OpenSea. The same applies to Decentraland NFT assets, which have their own marketplace, and are also traded on OpenSea.

In The Sandbox and Decentraland, parcels that are near famous brands, developments and holders will be priced more highly, and as attention is everything online, they could potentially represent good future value (although this is speculative and risky).

In the case of Otherside, you can buy Otherdeed for Otherside on OpenSea. These NFTs represent land, and watch out for those that contain Kodas, a strange creature created by Yuga. Although it’s not known exactly what Kodas will do in Otherside, only one in ten land NFTs has a Koda included, so they’re more highly priced.

How to Buy Metaverse Tokens

Image credits: Ape Foundation

The Sandbox token is called SAND, the Decentraland token is called MANA, and the token relating to Otherside is APE (although APE was created by an entity separate to Yuga Labs called the Ape Foundation, which administers ApeCoin DAO). All of these tokens can be purchased on major exchanges including Coinbase, Binance, KuCoin and Kraken.

In an unexpected move, Gucci just announced that it would accept payments in APE at some of its boutiques in the US, so it looks as though the metaverse is crossing over into real life.

Other Metaverse Projects

OM

OM is a virtual world being created by Punk6529, an art collector who is influential on NFT Twitter (and in the worlds of crypto and web3), and a deep-thinking advocate for an open metaverse (as in, a community-driven metaverse not controlled by centralized corporations.)

6529’s project is called OM (for Open Metaverse), and is tilted towards art, education and onboarding. OM is experimental and linked to 6529 Capital, whose NFT investment fund is open to accredited investors and qualified purchasers.

More generally though, if you’re interested in the future of the metaverse, it’s a good idea to keep up to date with the OM project, as Punk6529 is a well known figure when it comes to NFTs and the metaverse.

NFT Worlds

Image credits: NFT Worlds

This project had been building within the Minecraft ecosystem, until Minecraft owner Mojang Studios (itself owned by Microsoft) last month prohibited the use of NFTs and blockchain technology. This left NFT Worlds stranded, but they are now pivoting to creating their own game and open development platform based on Minecraft’s core mechanics.

The price of NFT Worlds assets fell heavily, no-one knows if they can pivot successfully, and it‘s a huge risk to buy in now. However, the Minecraft news drew a lot of attention to NFT Worlds, they have come out swinging with talk of a “web2 vs web3 battle”, and the possibility of a comeback is there.

Lamina1

Image credits: Lamina1

Lamina1 is not a metaverse, it’s a new blockchain, and it’s being partly led by Neal Stephenson, the man who first coined the term metaverse. Stephenson is (among other things) a renowned science fiction writer, and that word metaverse comes from his widely-cited novel Snow Crash.

Lamina1 is a layer 1 blockchain that is being created specifically with metaverse building in mind. It’s a work in progress, but the involvement of Stephenson, along with Peter Vessenes (who co-founded the Bitcoin Foundation in 2012), makes it a development to take note of.

Metaverse Index Funds

The Ball Multicoin Bitwise Metaverse Index is created by Multicoin Capital, Bitwise Asset Management, and Matthew Ball, who wrote the influential book, “The Metaverse and How it Will Revolutionize Everything”.

It’s only open to qualified purchasers putting in a 100K minimum investment, so it’s not something the general investor can be part of, but I’m mentioning it because it’s useful to check its holdings and see what the VC-ish faction is interested in. The index’s current top five holdings are Solana, Chainlink, Ether, Filecoin and Polygon.

Ball also created the Roundhill Ball Metaverse ETF, an index fund of metaverse-related stocks that trades on the NYSE, while the Ball Multicoin Bitwise Metaverse Index is crypto only, with no equities.

If you’re interested in those metaverse-related equities, take a look at the list of Roundhill Ball Metaverse ETF holdings, which has Roblox, NVIDIA, Unity, Apple and Microsoft in its top five.

For a metaverse crypto index you can go ahead and buy into, there’s the Index Coop Metaverse Index, with its MVI token. From a price of around 367 USD at the peak of last year’s metaverse hype, it’s down to about 45 USD now, so it could be due some gains in future when the crypto and web3 bulls wake up.