You can invest in the metaverse through metaverse cryptocurrencies, ETFs, and even real estate. Because of how new the metaverse is, these digital assets have the potential for incredible growth, but also the potential for extreme volatility.
If you’ve been following pop culture at all over the past year, then you’ve probably heard the term “metaverse.” But if you’re like most people, you’re probably still a bit unclear on what it actually is. Many people first became familiar with the concept of the metaverse in 2021 when Facebook CEO Mark Zuckerburg announced the company would be renamed Meta. But the concept of the metaverse has been around far longer than that.
Not only is the metaverse becoming increasingly prevalent in people’s lives, but it’s also created plenty of investment opportunities, even for the average investor. Keep reading to learn more about what the metaverse is, how to invest in it, and whether you actually should.
What is the metaverse?
The metaverse refers to a sort of digital universe. There’s not necessarily one concrete definition for the metaverse. Instead, it’s an umbrella term that refers to many different online activities that create a sort of virtual world. But instead of being like a virtual reality game you can turn off at any time, the metaverse exists in perpetuity.
Contrary to what some people believe, the term metaverse wasn’t created when Facebook changed its name to Meta. Instead, the term dates back to 1992 when author Neal Stephenson coined the term in his novel Snow Crash in reference to a 3D virtual reality. And like Neal Stephenson’s version of the metaverse, the real one is filled with real people coming together in a virtual world.
When you think about virtual reality, your first thought may go toward virtual reality games. But it goes a lot further than that. The metaverse is heading toward a future where people will be able to have entire lives in this digital space, from the way we shop and work to the way we own property and communicate with others.
How to invest in the metaverse
The metaverse presents plenty of opportunities to creators and investors alike. Today there are many different ways for investors to profit from the metaverse. We’ll talk about some of the most popular ones below.
It’s no surprise that cryptocurrencies have a prominent place in the metaverse — in fact, they represent the main form of payment. One of the best ways to invest in the metaverse through cryptocurrency is to buy a coin that supports a particular metaverse platform like MANA from Decentraland, BLOK from Bloktopia, SAND from The Sandbox, and more.
Metaverse crypto is the primary method of payment within these virtual worlds. Not only do they allow you to participate directly in the metaverse, but they have also risen in value over time, creating a potential for profit for those who buy it.
Another way to invest in the metaverse is by buying stock in metaverse companies. These days, more companies than ever are dipping their toes into the metaverse, including leading tech companies like Meta Platforms (formerly Facebook) and Microsoft.
But other companies have a significant role in the metaverse and provide an excellent opportunity for investors. Those companies involved in the metaverse include:
- Nvidia (NVDA). NVDA was founded in 1999 as a PC gaming company but exists today in the world of artificial intelligence. The company designs and sells GPUs — or graphics processing units — used in cryptocurrency, gaming, and more.
- Unity Software (U). This software is a real-time development platform that specializes in 3D, virtual reality, and augmented reality for gaming, animation, and more. The company’s primary goal is to serve content creators.
- Roblox (RBLX). Roblox is an online platform that allows users to connect through gaming. Among Roblox’s offerings are immersive 3X experiences built by developers. Roblox has been one of the fastest-growing companies in the metaverse.
The companies above are just a small sampling of those that allow metaverse investors to make money. Household name businesses — from Amazon to Nike to Disney — are also investing in the metaverse, and the number of metaverse-related stocks will certainly continue to grow over time.
Investing in individual stocks isn’t for everyone. In fact, financial experts often advise against investing too much of your portfolio in one industry. When you choose to invest in a single metaverse company, you’re attempting to pick winners and losers in a fairly new industry. But even if the industry succeeds — as it seems likely that it will — the company you invest in may not.
A “safer” way to gain exposure to the metaverse by stock investing is through metaverse exchange-traded funds (ETFs) and index funds, like the Roundhill Ball Metaverse ETF. An ETF is a basket of securities that allows you to gain exposure to many companies in a single investment. As the number of metaverse companies grows, so will the number of metaverse ETFs. And since they provide diversification, you don’t have to worry about the failure of a single company affecting your entire investment portfolio.
Metaverse real estate
The metaverse may not exist in the physical reality, but you can still buy property in it. Digital worlds like Decentraland allow anyone to buy a plot of virtual land and either rent it out or resell it for a profit down the road, just as you would any other type of real estate.
As we mentioned, purchases in the metaverse are generally made with cryptocurrencies, and metaverse real estate investments are no exception. In most cases, you’ll have to own the cryptocurrency specific to the metaverse platform where you’re making your real estate investment. For example, buying virtual land in Decentraland requires MANA, the platform’s cryptocurrency.
Non-fungible tokens (NFTs) are digital representations of real-world items like art, real estate, collectibles, and more. The tokens store data that confirm the ownership of a particular asset. NFTs present a unique opportunity, not only for investors but also for creators. Anyone can create a piece of art and sell it online. Meanwhile, anyone can become an art investor, something that’s historically only been reserved for certain people.
The metaverse has created plenty of interesting prospects for the future of NFTs. The metaverse is a sort of digital reality, so just as one can walk through a physical art gallery or museum, the metaverse can enable a virtual gallery or museum where people can see the creations of individual artists.
Pros and cons of investing in the metaverse
If you’re new to the concept of the metaverse, you may still be trying to wrap your mind around how it all works. And when you consider all of the investment opportunities, it’s easy to become overwhelmed and wonder whether it’s really worth it.
That being said, there are plenty of advantages and disadvantages to investing in the metaverse.
Here is a list of the benefits and the drawbacks to consider.
- Potential for huge growth and profit. It’s a relatively new industry, which means it has the potential for explosive growth. And thanks to the variety of ways individuals can invest in the metaverse, many people have the opportunity to profit from that growth.
- Individuals have a say in the design. What’s even more exciting about the metaverse is the unique role that individuals can play in its creation. Many digital and metaverse platforms allow their users to play a hands-on role in its direction.
- Potentially volatile. It’s true that the relative newness of the industry can be an advantage for investors, but it can also be a disadvantage. As new companies tend to do, metaverse companies are likely to experience volatility, which can result in investors losing money.
- Investment risks. Additionally, as we mentioned above, investing can be especially risky when you’re picking individual metaverse stocks, since some of those companies may not have a long future.
How do you invest in metaverse coins?
You can invest in metaverse coins through any major cryptocurrency exchange. Some crypto platforms also have a native coin, which users can purchase directly on the platform.
Does the metaverse have stock?
Yes, there are plenty of stocks that allow individuals to invest directly in the metaverse. You can buy stock in companies that operate solely in the metaverse, or even those who are just dipping their toes into the industry.
Which is the best metaverse to invest in?
The metaverse is more of a concept than a single place or a number of places. And within the metaverse, there are many places to invest, from cryptocurrency to metaverse stocks to NTFs.
Are metaverse coins a good investment?
Metaverse crypto can be an excellent investment, but it’s important to proceed with caution and understand the risks you’ll face.
- The metaverse is a concept that’s made up of virtual reality and digital universes, where users can invest, shop, game, and more.
- There are many ways to invest in the metaverse, including cryptocurrency, metaverse stocks, ETFs, real estate, and NFTs.
- Metaverse investing has plenty of advantages, such as the opportunity for massive growth, but there are also plenty of risks.
- If you’re considering investing in the metaverse, it’s important to create a diversified portfolio where only a portion is dedicated to the metaverse.
Investing in the metaverse
The metaverse has been around for a while, but it’s just now making it on many people’s radars. And as it becomes more prevalent, there are an increasing number of investment opportunities available for individuals.
If you’re ready to start investing, it’s important to find the right brokerage account. We’ve rounded up a list of the best online brokerage firms. Visit our comparison tool to read customer reviews, learn about the investment options available, and choose a platform that works for you.
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