What is the Metaverse and should you invest in it?

What is the Metaverse and should you invest in it?

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In October 2021, Facebook made big news by changing its name to Meta. There’s much more to the metaverse than Mark Zuckerberg, but if has left you curious about the investment opportunities it offers, you’re not alone. We’ll run through what the metaverse is, why investors are so excited about it, and some of the opportunities available for you to get involved.

What is the metaverse?

The metaverse is a term for the new virtual world that’s emerging as technology advances. It’s a concept that dates back to 1992, when a dystopian book by Neal Stephenson called “Snow Crash” was released, featuring characters that wore 3D headsets to access an alternate reality. On the surface, this seems like nothing new — many of us have been playing games like The Sims and Second Life for decades. But what makes the metaverse different is that it won’t just be one game: It’s set to be a whole new way for us to interact with the internet (often called Web 3.0).

The idea is that people will be able to move seamlessly from activity to activity, all while retaining the same avatar and in-game items throughout each one. For example, your virtual self might walk to a casino and join a gambling game there, then walk to a mall and buy something. All within the same platform.

Plus, as virtual reality and artificial intelligence become more sophisticated, the lines between reality and fantasy may be blurring. Developers are working on creating realistic 3D experiences that can mimic how we feel sensations in the real world — and artificial intelligence can use machine learning to make the environment uniquely appealing to the psyche of the individual. 

The metaverse and blockchain 

The metaverse is closely linked with the blockchain and cryptocurrencies when we talk about it today. This is primarily due to the possible applications of smart contracts and non-fungible tokens (NFTs), which allow people to securely buy goods and exchange them between different parts of the metaverse. For example, you could buy a hat for your avatar and wear it when you gamble and when you go to the mall. We may also use cryptocurrency wallets to buy items in the metaverse, or even verify our identities.

Decentraland is one of the most promising metaverse projects on the blockchain. Its team is creating a virtual gaming world owned by its users, who can buy plots of land in the Decentraland world as NFTs and build on them. 

How to invest in the metaverse

Meta (FB) has certainly shown some promise — the company is developing virtual reality technology with Oculus, researching the use of biometric data to influence the metaverse we experience, and is aiming to build the world’s fastest AI supercomputer. However, just because Zuckerberg took the name, it doesn’t mean that buying his company is the best or only way to expose yourself to the metaverse. And you don’t have to start getting into crypto, either. Here are a few other routes you could take.

Gaming

Content about the metaverse is often accompanied by images from a certain video game with more than 47 million active users: Roblox (RBLX). Although it originally started as a regular video game and its biggest audience is young children, Roblox has come to represent everything to do with the blockchain. It has its own virtual currency, avatars that users can buy clothing and accessories for, and all kinds of in-game experiences. 

3D technology

As well as the companies creating metaverse platforms, firms creating the products to keep everything running behind the scenes will also profit from the metaverse boom — and the semiconductor company Nvidia (NVDA) could be one of them. It produces fast-processing chips and graphics processing units that will be key for powering the metaverse. It’s also researching 3D technology and artificial intelligence and plans to launch its own so-called Omniverse to connect different 3D worlds. 

Another one to consider in this sphere is Unity Software (U), which makes software that aids game designers in making 3D worlds. Its software is so accessible that anyone can build a game with it, even if they don’t have the usual technical background.

Source: Nasdaq

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