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Proprietary Data Insights Financial Pros Top Metaverse Stock Searches in January
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Ready Player One Remains Elusive Facebook (META) generates massive profits from scale. The metaverse isn’t quite there yet. While you can certainly explore the vast worlds through your desktop, the truly immersive experience comes with virtual reality, which is quite expensive. We aren’t likely to hit the state of Ready Player One, the novel and subsequent movie that had the entire population glued to VR headsets, in the next decade as prescribed in the story. Think about how long it took for the internet to blossom into its current state. We may not need to wait several decades, but it’s going to take a while before we move from creepy legless bodies to something more palatable. And our supply chain struggles certainly don’t help. Our dour assessment on metaverse real estate isn’t because we don’t believe in its future. More a matter of timing and opportunity cost. |
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Virtual Landscape |
Metaverse Real Estate |
Key Takeaways
Snoop Dogg is building his own digs in The Sandbox Metaverse. His neighbor paid $450,000 to live next door. Is this for real? Digital Real Estate Several companies including The Sandbox, Decentraland, and Open Sea have begun to sell virtual real estate with non-fungible tokens (NFT) tied to each unique property. Snoop Dogg is developing his own “Snoopverse” on The Sandbox, a platform geared towards gaming and entertainment. Investors use these locations to build anything they want from virtual stores to hangouts to exclusive concerts. Believe it or not, you know quite a bit about digital real estate right now. For example, domains and websites are digital real estate. The metaverse just expands on this concept. Is it actual land? In one sense yes. Companies like Tommy Hilfiger and Sotheby’s create virtual storefronts for users to explore. However, the technology isn’t quite up to snuff yet. Many of these virtual stores may showcase products, but you’ll be redirected to typical websites to checkout. You can also think of metaverse real estate as a service. Each platform provides you an area to create, build, and market your own real estate as you would a website. The Downsides Despite the hype, not too many people frequent the metaverse. We’re not at the same stage as Ready Player One. Decentraland, one of the more popular platforms, only averages around 1,600-2,000 active users at any given time. That’s practically nothing. There’s also the issue of incompatibility. You see, you can’t build in Decentraland and then hop over to The Sandbox. They’re entirely different platforms. It’s akin to trying to go from a Playstation to an Xbox. So it’s a Pump & Dump? Not exactly. There are real reasons to own digital real estate. But the hype around them has a lot of that scammy feel to them since most companies just charge standard fees rather than allowing floating market prices. Get Your Digital Wallet Ready To buy real estate in the metaverse you’ll need a digital wallet in the majority of cases. You’ll also need to load up on whatever the currency of the land is. Decentraland relies on MANA. The Sandbox uses SAND. Real clever names right? Keep in mind that these currencies are subject to price fluctuations the same as Bitcoin or any other digital token. That means owning digital real estate carries two types of risk: the real estate price and the token’s value. The Bottom Line: While it may be cool to build in the metaverse, buying there doesn’t have a ton of allure…yet. Sure you could flip a property for a profit. But right now, it’s nothing more than speculation. That said, if you’re looking for stocks cashing in on the boom, take a look at Roblox (RBLX) or the larger Meta (META). |
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