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There is a good reason to invest in Metaverse. Research groups predict that the metaverse could be worth $800 billion or more by 2030, making it one of the biggest secular growth trends of the decade.
The Metaverse trend is also still very young. Consider that Facebook just rebranded itself as the Meta Platform in October 2021 (more on that in a moment), bringing the public’s interest in Metaverse stock. Today’s investors can get in on the potentially profitable trend very early.
Let’s consider how to invest in Metaverse.
Metaverse investment
Yes, you can invest in Metaverse. But the metaverse is not a unique digital world. There are many other universes to explore. For example, in the cryptocurrency space, two of the most popular are Decentraland (MANA) and Sandbox (SAND). Mana and Sand are both native currencies for their respective metaverse platforms that allow users to purchase digital real estate among other things. As more users join these platforms, the value of tokens increases.
However, investing in Metaverse cryptocurrencies is challenging because it is hard to know which platform will end up being used. Not all are the same, so careful research should be done before investing.
Improved user metrics also do not necessarily mean that the value of Metaverse tokens will increase. From November 2021 to June 2022, the price of Mana tokens dropped by more than 80%, even though user metrics remained relatively stable during this time.
Investing in Metaverse digital currencies can be high risk. NFTs represent digital ownership of assets such as images, music, tickets and more. Owning a digital asset on a metaverse platform could one day be valuable, but it is very difficult to predict.
It may be in the best interest of investors to focus more on companies that are building real-world and cashing in on the metaverse trend.
Hundreds of public companies want to convince you that they are Metaverse stocks. Following the announcement of the meta name change, the number of public companies mentioning metaverse at quarterly conferences more than doubled. However, few companies are as invested in Metaverse as MetaPlatform, Snap, and Nvidia.
A digital world that enables real-time interaction, economic activity, and a wider array of experiences requires a lot of infrastructure and development behind the scenes. Meta spends billions of dollars every quarter on its reality labs division. The company believes that Metaverse will be big and is preparing to solve the logistical challenges.
The company spends hundreds of millions of dollars each quarter on research and development — its largest operating expense, by far. A large portion of this spending is spent on developing virtual reality (VR) and augmented reality (AR) software capabilities. At Metaverse, premium VR and AR content is key. And given the amount of money Snap is spending on content, there’s a good chance its technology will be used by many in the metaverse.
Manufacturers are increasingly turning to Metaverse companies to help build digital twins for their factories so they can troubleshoot problems on the ground and optimize processes. Good artificial intelligence (AI) software helps speed up simulations, and Nvidia excels at AI. Nvidia AI is currently used by more than 25,000 companies. This is a key reason why companies are increasingly turning to Nvidia’s Metaverse solution called Omniverse.
Investing in stocks like Meta Platform, Snap, and Nvidia has a potential downside. As mentioned, these companies are investing significant resources in Metaverse. However, it’s possible that the metaverse won’t end as well as everyone expects. If it is not profitable in the end, these companies should return this capital to the shareholders.
It is important to understand the principles of investing in the stock market before buying the shares of these companies. It also emphasizes the importance of diversifying your portfolio in non-metaverse stocks.
The ETF includes Meta Platforms, Snap and Nvidia, as well as dozens of other companies. which are focused on the metaverse. This can be a great way to participate in the metaverse’s upward trend without having to pick individual winners in space. Because ETF managers can actively buy and sell positions and receive management fees.
Verifying and protecting your identity has its problems on the Internet. Some experts believe that encryption can help protect your identity in the online world. And NFTs probably too
They help you. That’s what Brian Armstrong, CEO of cryptocurrency platform Coinbase Global, says. which this company is working on. If cryptography is the way we protect our identity in the metaverse. It makes sense that Coinbase would be part of the solution given the company’s significant resources for research in the space.
The metaverse trend is an exciting opportunity to invest in from several different angles. But it’s important not to get caught up in the emotional buzz around it. All Metaverse investments, whether in cryptocurrencies, NFTs or stocks, require due diligence. And they should only represent a portion of your overall portfolio.
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