The word Metaverse is the new buzzword around. From Tech Giants to top Retail Companies, almost everyone is talking about the metaverse as the thing of the future. The amount of companies investing in the metaverse keeps growing by the day. 

Heralded as the next big wave of the internet, Metaverse promises to change how we experience a digital presence. It is popularly termed Web 3.0. 

With Metaverse, comes a whole lot of new jargon like Cryptocurrencies, NFTs, Blockchain technology etc. As Metaverse signifies the beginning of a new world, it is imperative to now understand what these terms actually stand for. 

Today in this article we shall explore the biggest question on a lot of people’s minds: How do I invest in the Metaverse? 

So, without further ado, let us understand what is the metaverse all about and know about the different cryptocurrencies and technologies used in the metaverse and how you can be investing in the metaverse. 

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What is the Metaverse all about?

The Metaverse is the name given to an online virtual world that makes use of technologies like Virtual Reality (VR), Augmented Reality (AR), Three Dimensional Characters (3D), and different modes of communication. 

Sounds really like a thing of the future, doesn’t it?

Well, Metaverse does mark as a fresh new stage of the internet. Here People can create their 3D Avatars and customize them according to their liking. Imagine if you could create a mini version of yourself on different social media, and then actually get to hang out with your friends in a virtual café. Sounds pretty interesting, if you may ask. Metaverse aims to make this a reality. 

Just as if we would buy a new T-shirt from a store and wear it to a party, in the same way in the metaverse we could buy things for our Avatar on one platform and also carry it forward towards the other platforms. 

Metaverse was defined to be the fourth wave to computers following mainframe computers, personal computers and Mobile computers, by the famous venture capitalist Matthew Ball. [1]. 

Matthew Ball also known as the expert when it comes to the metaverse, says that it’s about moving people into “Ambient Computing”. He further goes on to say it’s no more about just accessing the internet to interact, but rather staying online always. Similarly, it’s not about accessing the computer anymore, but rather is living within the computer. [2]

Origin Of The Name “Metaverse”

If you think the concept of metaverse sounds a lot like a sci-fi novel, then you are not wrong. In fact, the term metaverse was coined by an author named Neal Stephenson in his novel called “Snow Crash”, published in 1992. The book has a dystopian setting in the future where much of the world is present in the metaverse and humans interact in the form of Avatars. 

The book was apparently even a required read for the new recruits at Facebook. After “Snow Crash”, another novel called “Ready Player One” written by Ernest Cline used and expanded on the concept of the Metaverse. This book was also adapted into a movie that went on to become successful. 

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How do the Metaverse Cryptocurrencies Work?

Metaverse is essentially going to be a miniature version of the real world. A digital world where everything that could be done in the physical world – say a concert, a wedding or even a work meeting – everything can be done in the metaverse too. As even product launches of brands like Gucci is being held in the metaverse, the future is bright for those who know how to invest in the metaverse. 

If you are interested in investing in the metaverse, then you should also know the technology that is going to be responsible for transactions in the metaverse: Blockchain Technology. 

What is Blockchain Technology?

Blockchain technology offers decentralized and transparent solutions for owning digital ownerships of different things, digital collectability and even governance, accessibility, etc. 

It is a technology that essentially keeps a permanent track record of all the transactions taking place in blockchain technology. Since it is decentralised, it is not limited to one platform, but rather the record of a particular transaction is redistributed to thousands of individual computers around the world. 

Decentralised and Transparent

Blockchain Technology keeps a record of the transaction in a type of public database known as a ledger. Bitcoin is one of the most renowned blockchain cryptocurrencies. Suppose if I were to buy some bitcoins, then the transactions record shall be noted in Blockchain Technology. This record of transactions will then be available on the public database ledger and accessible through thousands of individuals computers. In a way, this shows how blockchain technology is also transparent. [3]

Ethereum

Another popular blockchain platform is Ethereum. Its cryptocurrency Ether is the second most popular cryptocurrency after Bitcoin. What sets Ethereum apart is the fact that it has features known as smart contracts and decentralised applications. 

It helps users in making contracts that could be validated through Blockchain software. The smart contract is similar to the contracts that we have in the physical world. For example, if I were to purchase a digital piece of art or music, then I could draw up a smart contract for this purchase. This smart contract will serve as proof of ownership of that digital object. These digital objects are known as digital assets. 

Once a digital asset has been purchased and the proof of ownership is on the blockchain through a smart contract, then nobody can claim ownership to that asset even if they might have a copy of it saved anywhere. 

NFTs

Digital assets related to mostly artwork or music is known as NFTs (Non-fungible tokens). NFTs are unique to each item. When you make an NFT of a particular item, you make sure that you retain the ownership of that item in the digital space. For example, many people have counterfeit paintings of Monet, but the real proof of ownership can be claimed only by one person who has the real painting. 

Fungible means things or values that are not swappable or exchangeable. Currencies like Dollars are fungible as the value remains the same and can be swapped with other dollars. 

There is nothing unique about it, unlike NFTs. [3]

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How is Blockchain Connected to Metaverse?

Blockchain allows transactions to happen without needing a third-party bank or escrow. Its decentralised and Transparency factors help it to become the choice of platform for cryptocurrencies used in the metaverse. 

As NFTs have become the new hype word, more and more people are investing in NFTs and also investing in the metaverse. Blockchain technology allows such transactions to take place and also have a public database of the same. 

As metaverse will not be owned by one particular company, but rather there will be different metaverse platforms built by different companies. These metaverse worlds might even be interoperable in the future, meaning that if you were to own an NFT in Meta’s (formerly Facebook) metaverse world, you could also use it in the metaverse created by Microsoft. 

The blockchain will be able to serve as proof of ownership as you carry your virtual assets from one platform to another. 

Some Common Cryptocurrencies in the Metaverse

When you are investing in the metaverse, cryptocurrencies are your go-to. But different metaverse platforms usually have different crypto-tokens. Some common currencies are:

Ether (ETH)

These are the most preferred cryptocurrencies when it comes to purchasing pieces of land in the metaverse. The ether is a cryptocurrency specific to the Ethereum platform. It is used for building decentralised applications and NFTs. Ether is one of the most renowned cryptocurrencies and as a result, it is available across all different crypto exchanges such as Gemini, Coin Base, or eToro. Mainstream digital payment applications like Paypal, and Venmo have also begun to accept ether on their platforms. [4]

SAND

SAND is a crypto-token specific to the metaverse platform created by The Sandbox. SAND can be used for transactions like the purchase or selling of digital assets like NFTs or for buying land in The Sandbox Marketplace. It can be even used to play various games. SAND crypto can be bought on exchanges like UPit, Huobi, Binance, etc. 

MANA

MANA is another exclusive crypto token for the platform Decentraland. Decentraland is a virtual world where users can own pieces of land, carry out different transactions like the purchase or selling of these pieces of land by interacting with other users. 

It can also be used to buy other “wearable” items for your avatars including clothing and accessories. Decentraland is a type of decentralised autonomous organisation. Therefore, by owning MANA, you also get the opportunity to vote on certain policies related to Decentraland and also participate in NFTs Auctions. 

MANA is available for purchase on exchanges like Kraken, Gate.io., and Binance. 

AXS

AXS is a cryptocurrency unique to the gaming platform of Axie Infinity. Here you can even earn AXS tokens, apart from buying them, through breeding unique digital pets called “Axies”. Various NFTs can also be used for participating in matches and tournaments.

AXS can be purchased on exchanges like Coinbase, Binance, Gemini etc. 

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The First Step of Investing in Metaverse

Now that you are familiar with the different cryptocurrencies, let’s talk about the first steps that you need to take for investing in the metaverse. The first step shall be

Opening a Digital Wallet

We know the importance of carrying a wallet in the real world. All our currencies and ID proofs are stored in our wallets usually. Similarly, digital wallets also serve the same purpose. The first requisite for opening an account in a metaverse platform is to set up a crypto wallet that will be able to hold all your digital currencies.

MetaMask is a popular platform that can be used to set up a digital wallet. You can download the application or set up a google chrome browser extension on desktops. 

This wallet will allow you to exchange different currencies, for example, US Dollars into cryptocurrency using a credit or debit card. The conversions are facilitated using platforms like Wyre or Transak after paying a nominal fee.  

Apart from shopping using cryptocurrency in your digital wallet, it can be also used to contain legal IDs for verification purposes. If our ID is linked to our wallet, we won’t be needing to remember different login details. Instead, just by setting up our digital wallets on different virtual worlds, we could log in without the hassle of remembering different login credentials for different platforms. [3]

Conclusion

Metaverse is no doubt the future of the internet. It is also being known as Web 3.0. But still, the full vision of metaverse turning into reality is decades away. The technology and acceptance required are in their nascent phases. It requires superb technological advancements, persistent simulations by millions of users around the world online at the same time, and even proactive regulatory involvement. 

But it is important to note that the new digital world will also create a complete change in policies of businesses, organisations and even consumer behaviours. 

The growing popularity of Cryptocurrencies and NFTs is an indicator of the changes occurring in consumer behaviours. Top Companies have already started investing in the metaverse. Whether it is Gucci, Burberry, Adidas, Nike or even Victoria’s Secrets, digital fashion will become as big as real-world fashion. Maybe next time you could buy clothes in the virtual format for your avatar, before actually wearing them in the physical world!

Along with technology and gaming, retail might also become the next big thing for investing in the metaverse. 

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Frequently Asked Questions

1. What are the top metaverse stocks to invest in?

Some top metaverse stocks to invest in are:

Meta Platforms Inc. 

Nvidia Corp. (NVDA)

Qualcomm Inc. (QCOM)

The top stocks preferred by Warren Buffet include Apple, Activision Blizzard, and the Chinese corporation of battery and electric vehicles maker. BYD. [5]

2. What is the difference between Bitcoin and Ethereum?

Bitcoin is essentially a replacement for traditional currencies. It is used as a medium of exchange and of storing value. Ethereum is a blockchain that uses other innovative features like Smart contracts, NFTs, etc. [6]

3. What is the connection between metaverse and NFTs?

Metaverse is a digital platform that will be similar to the real world. Owning digital assets like paintings, memes, images or even music can be done on the metaverse. Just how in the real world, contracts serve as proof of ownership, similarly NFTs will be a mark of ownership of a particular digital asset. 

References

[1] Ball, M. (2021, December 15). Framework for the Metaverse. MatthewBall.Vc.

[2] Chen, B. X. (2022, January 18). What’s All the Hype About the Metaverse? The New York Times.

[3]Ratan, R., & Meshi, D. (2022, January 14). The metaverse is money and crypto is king – why you’ll be on a blockchain when you’re virtual-world hopping. The Conversation.

[4]Hou, F. (2021, December 11). How to shop in the metaverse: The cryptocurrencies you’ll need to buy, and how to get them. Fortune.

[5]Speights, K. (2022, February 20). Here’s Warren Buffett’s Favorite Metaverse Stock by Far. The Motley Fool.

[6]Bitcoin vs. Ethereum: What’s the Difference? (2022, February 21). Investopedia.