How to Invest in Metaverse: Guide for Beginners

In the past couple of years, more people are becoming excited about how to invest in the metaverse. It marks the coming of a new era. Digitalization is changing the ways people tread business and technology.

Surprisingly, you will not find the origin of the term metaverse in cryptocurrency books. Instead, this fictional universe derives from a 1992 science fiction novel by Neal Stephenson called “Snow Crash.”

From being a mere metaphor for the real world, the metaverse has turned into a functional subspace where humans can interact with each other. But beyond chatting (with apps like the Sceyt chat platform) and building relationships, the metaverse has become a money-making ecosystem.

According to McKinsey & Company, more than $120 billion of investment flowed into the metaverse in 2022, but the numbers will keep rising. Its dynamic growth continues as consumers and corporate actors become more active in the field. 

The metaverse is creating big waves today but has not reached its full potential. By 2030, experts predict that the metaverse’s value will balloon to $13 trillion

If you are interested in exploring what the metaverse offers, now is the perfect time to do so. Here is an extensive discussion regarding the metaverse and everything else to watch out for.

Gradient metaverse illustration

What is the metaverse?

In its most basic sense, what is the metaverse?

From being something fictional, the metaverse turned into a digital concept. The metaverse is an interactive 3D digital space where visitors see each other as avatars and interact through the features offered by the platforms that host them.

While intangible, the metaverse is an existing reality. Binance considers it the future iteration of the internet. After all, people use the metaverse to interact with others in a simulation that resembles face-to-face meetings. 

Nowadays, the metaverse concept manifests most in gaming. But it also provides virtual spaces for trading, entertainment, and social media.

What is metaverse economy?

The metaverse has an economy separate from the physical world. After years of trading game items, avatars, and other digital properties, the metaverse economy formed organically in response to the needs and demands of the virtual world.

Forbes said that as the metaverse economy lacks real-world regulations, it turned out to be an on-demand economy. Anyone who intends to venture into this economy must readily respond to the demands of consumers and deliver competitive outputs.

The metaverse expands beyond creativity and entertainment. As the virtual world experiences more industrial revolutions, the metaverse economy will soon take roots and form unique and never-seen-before systems.

How to invest in metaverse?

Investing online is a whole new ballgame. Even if you have experience trading stocks and other financial assets attributable to the real world, there will still be things that will shock you in the metaverse.

Are you looking for ways to start investing? Here are some steps you can try to invest in the metaverse:

1. Buy metaverse cryptocurrencies

The easiest route to investing in the metaverse is through cryptocurrencies. You only need to set up a digital wallet and purchase your preferred digital currency. From there on, you can participate in metaverse projects.

Bitcoin and Etherium are two of the most used and valuable cryptocurrencies today. As of early 2022, the former has a market capitalization worth $425 billion, while the latter is at $145 billion. Most investors flock to these platforms because other cryptocurrencies do not have a comparable market cap.

Most metaverse transactions require cryptocurrency as a mode of payment. Opening a digital wallet somewhat becomes a requirement to purchase and trade with other investors because there is no longer a direct exchange of real-world money between people.

Before accounting for cryptocurrencies, always check in with state and federal laws to avoid violating regulations.

2. Purchase virtual world real estate

Virtual or metaverse real estate refers to programmable spaces within the virtual world where people can socialize, game, trade, and perform any activities imaginable to men.

The value of virtual land

Virtual land works similarly to a plot in an agricultural or residential area. It is an exclusive space for the landowners to manipulate and build anything that will satisfy their whims. However, compared to real-world lands, lands in the metaverse are more expensive.

Investors pay millions of dollars to obtain a parcel of virtual land. In 2021, a virtual plot sold for $4.3 million. Game company Atari, popularly known for titles like RollerCoaster Tycoon and Zoo Tycoon, purchased this plot from The Sandbox. So far, it is the most expensive metaverse property ever sold. 

When Facebook, now known as Meta, announced moving to the metaverse, virtual plot prices rose to 500%. As a result, the average $12,000-priced virtual land may no longer exist within a few months.

How to purchase metaverse land

After knowing the value and potential of virtual lands, you might be interested in how to get one. The process is fairly simple. 

  1. Open a digital wallet. This primary step is necessary to create an account that will hold your digital money and assets.
  2. Purchase cryptocurrency. Cryptocurrency is the money of the virtual world. Convert your money into cryptocurrency and store it in your digital wallet.
  3. Choose which metaverse platform to invest in. Metaverse platforms function like digital stores. Popular platforms for virtual lands include The Sandbox, Decentraland, and CryptoVoxels.
  4. Pick the virtual lands of your liking. It is as simple as browsing apps from the App store. Most platforms readily display the location of the land and its corresponding price.
  5. Confirm your purchase. After clicking into your desired plot, a prompt will show to confirm your purchase. Once verified, the plot is officially yours now.

A virtual land can turn into a digital billboard, virtual concert hall, or an immersive world for gamers. You can also resell it at a higher price after reconstruction. Indeed, metaverse lands hold so much potential for financial gain.

3. Exchange traded funds or ETFs

Exchange-Traded Funds (ETFs) are a form of investment fund for stocks, commodities, bonds, or foreign currency. EFTs form investment pools whereby investors earn through interest as said investments grow.

There are several types of ETFs. Some of the most common ones include:

  • stock ETFs
  • index ETFs
  • bond ETFs
  • commodity ETFs
  • currency ETFs
  • inverse ETFs
  • actively managed ETFs
  • leveraged ETFs
  • real estate ETFs

In the United States, investors must register ETFs with the Security Exchange Commission (SEC) as an open-end investment company or unit investment trust. 

Since ETFs have the format and features of stocks, they behave like one. One prominent characteristic of ETFs is their prices fluctuate multiple times within a single trading day.

Compared to regular stocks, ETFs can be cheaper. Since ETFs are exchange-based, brokers carry most of the costs related to trading. Additionally, EFTs have more accessible markets than common equities and bonds. Since EFTs can be margined or leveraged, they hold greater flexibility.

4. Acquire non-fungible tokens or NFTs

Non-fungible tokens (NFTs) are a unique data set on a blockchain representing a digital asset. When NFTs get sold and traded, ownership of the digital assets represented in the tokens also transfers.

While NFTs and cryptocurrencies share similar attributes, they are not the same thing. You can trade cryptocurrencies at a similar equivalency. However, with NFTs, you cannot receive something of the same value because every NFT is unique. 

Another thing, the value of NFTs depends on the market’s appreciation for a particular digital asset. So the more popular or in-demand an NFT becomes, its price tag will upsurge too. For example, the iconic “Doge” meme NFT sold for $4 million.

There are several ways to make NFT investing profitable. Here is what most traders do:

  • Selling self-made NFTs
  • Buying and flipping NFTs
  • Incorporating NFTs in brands to grow their value
  • Long-term NFT investments

Traders often mix and match these strategies to achieve the best results.

5. Invest in metaverse stocks

You can also grow investments involving the metaverse outside virtual worlds. One good way to do so is by trading stocks.

Metaverse stocks exist, and they are available as publicly traded assets. These stocks represent investments that develop metaverse technology and other activities related to this realm. 

The popularity of the metaverse positively affects metaverse stocks. As more people become more interested in virtual reality and building businesses in the digital subspace, find metaverse stocks a safe middle ground investment before venturing into virtual lands, ETFs, or NFTs.

Investing in metaverse stocks is an indirect investment in digital properties. Instead of buying a digital plot or token at full price, you pay a fraction of it together with other investors and cultivate said assets together.

6. Invest in the metaverse index or MVI

The Index Coop designed the metaverse index (MVI) to analyze virtual environment trends in entertainment, sports, and business. The MVI creates a final index by assessing the square root of market cap and liquidity weighting.

The MVI consists of several tokens, including:

  • Audius ($AUDIO)
  • Axie Infinity Shards ($AXS)
  • Decentral Games ($DG)
  • Decentraland ($MANA)
  • Enjin ($ENJ)
  • Ethernity Chain ($ERN)
  • Illuvium ($ILV)
  • Meme ($MEME)
  • Muse ($MUSE)
  • NFTX ($NFTX)
  • Rarible ($RARI)
  • REVV ($REVV)
  • Terra Virtua ($TVK)
  • The Sandbox ($SAND)
  • WAXE ($WAXE)

The growth in the number of metaverse-related investment opportunities today is unreal. New cryptocurrencies exist, and more creators are minting digital properties. 

Amid all this chaos, the MVI exists to study trends and process them into a single investable token. Investing in the MVI should be more comprehensive and cost-efficient than individually checking many digital investments.

7. Sell or lease metaverse experiences

As a virtual landowner, you have a choice to keep your properties idle. However, if you prefer engaging in profitable activities, there are many ways to turn your metaverse real estate into a money-making machine.

You can be a metaverse lessor. After developing a digital space, you can contract with companies to host events like concerts and conferences. The lease for metaverse plots can be as high as $60,000 per month.

You can also sell metaverse experiences. Besides being the facilitator between clients and their customers, you can directly coordinate with a client pool and offer unique services to them.

Many virtual landowners are looking into virtual tourism. This new form of tourism combines modern technology and the endless possibilities of the metaverse. Tourists no longer have to leave their houses to go to new places.

5 Best metaverse stocks to invest in 2022

Knowing how to invest in the metaverse is not enough to succeed. For starters, it is critical to identify the best assets to invest in. 

Listed below are promising metaverse stocks that many consider profitable and stable investments. Study their characteristics and behavior to know which ones best suit you.

1. Meta (NASDAQ: FB)

Full name: Meta Platforms Inc
Year founded: 2004
CEO: Mark Zuckerberg
Sector: Technology
Earnings per share (EPS): $13.22 (June 2022)
Market cap: 429,628,837,686
Shares outstanding: 2.71 billion

Meta Platforms Inc. was formerly known as Facebook, an American multinational technology conglomerate. Besides Facebook, it owns major social media platforms like Instagram and WhatsApp and their affiliated products and services.

Meta is one of the most sought-after metaverse stocks in 2022. This year, its value decreased by almost half, and many see this as a sign to purchase a share. Meta’s slowdown is said to be temporary and has a projected estimated growth of 14% by 2024.

Besides being a corporate giant, Meta is one of the most progressive and innovative metaverse companies. It will likely remain a frontrunner and grow further in both the physical and virtual worlds.

2. Nvidia (NASDAQ: NVDA)

Full name: Nvidia Corporation
Year founded: 1993
CEO: Jensen Huang
Sector: Technology
Earnings per share (EPS): $3.73 (June 2022)
Market cap: 423,500,000,000
Shares outstanding: 2.535 billion

Nvidia is an American multinational technology company. It is mainly known for designing graphics processing units (GPUs), application programming interfaces (APIs), and system-on-a-chip units (SoCs). Because of its top-quality hardware and software products, it became a renowned name in the gaming industry.

Forbes observed that Nvidia has been gaining momentum since 2021. In just a year, Nvidia’s stock price increased by 127%. Luckily, finding Nvidia in index funds and ETFs is not that difficult.

3. Cloudflare (NYSE: NET)

Full name: Cloudflare, Inc.
Year founded: 2009
CEO: Matthew Prince
Sector: Technology
Earnings per share (EPS): $-0.83 (June 2022)
Market cap: 16,401,564,421
Shares outstanding: 0.323 billion

Cloudflare is an American content delivery network and DDoS mitigation company most recognizable for providing a reverse proxy between web visitors and Cloudflare clients’ hosting providers.

Q1 earnings reached $212 million, which is a positive sign that Cloudfare is faring well. Also, there is a noticeable growth in Cloudflare’s sales growth. Stay vigilant. A compelling entry point may appear soon.

4. Unity (NYSE: U)

Full name: Unity Software Inc.
Year founded: 2004
CEO: John Riccitiello
Sector: Technology
Earnings per share (EPS): $-2.10 (June 2022)
Market cap: 13,231,781,234
Shares outstanding: 0.294 billion

While founded in Denmark, Unity is a video game development company operating in the United States. Notably, Niantic’s Pokémon Go was built on a Unity engine.

Unity stocks may be one of the best long-term buys today. Investors should take its price drop as a sign to buy more stocks. Experts say that Unity will soon recover as more metaverse projects come to fruition.

5. Roblox (NYSE: RBLX)

Full name: Roblox Corporation
Year founded: 2004
CEO: David Baszucki
Sector: Technology
Earnings per share (EPS): $-0.90 (June 2022)
Market cap: 20,838,887,339
Shares outstanding: 0.589 billion

Roblox Corporation is an American video game developer, mostly known for creating the game “Roblox” in 2005. Today, Roblox is one of the most played games on the internet. At least 30 million individuals play this game daily.

Roblox’s popularity also benefited the value and attractiveness of its metaverse stocks. This company’s dynamically expanding ecosystem strengthens the sellability of its metaverse stocks.

Recommended courses for you

Do not start investing in the metaverse without having technical knowledge beforehand. Study about virtual worlds, metaverse platform development, and other types of metaverse content.

Technical information can be hard to digest, especially without guidance from the experts. So instead of studying by yourself, browse these professionally made courses to have a smoother educational experience:

1. Metaverse Essentials

By 2026, at least 25% of the population will spend at least one hour per day in the metaverse. As metaverse platforms grow more mainstream, this statistic will grow exponentially. Learning more about the metaverse today will give you a sharp edge against competitors in the next few years.

If you are new to investing in the metaverse, Metaverse Essentials is the perfect course for you. It is a comprehensive but easy-to-understand educational webinar on everything you should know about NFTs, blockchain technologies, and everything encompassing the metaverse.

The course runs for 7 hours, but you may choose not to finish everything in one go. Study a few chapters today and finish the rest during your free time.

2. NFT Investing 101: Know Everything About NFTs

NFTs are a large part of the metaverse. It is one of the most critical metaverse concepts to learn before acting on any investment opportunities.

NFT Investing 101: Know Everything About NFTs provides a general overview of NFTs, cryptocurrency, and ways of earning through virtual goods. It is the best starter course for budding metaverse investors who do not know where to start.

By the end of this course, learners will discover tools like Metamask and have an overview of the popular metaverse platform Opensea. They will be ready to study more intensive subjects on NFT investment and other related fields.

3. Blockchain Essentials

Blockchain Essentials will teach you about the history of blockchain technology and the reasons this particular concept is changing the world today.

Before learning about metaverse investment strategies, spend some time learning about blockchain and its fundamental ideas. This course has a well-designed syllabus on the defining qualities of blockchain, the cryptocurrency market, and other essentials to growing a blockchain-based business.

This course will not put your 2 hours and 7 minutes to waste. Every section is jam-packed with crucial lessons that are easy to understand and replicate. So listen closely to avoid missing real-life hacks that successful metaverse investors use.

The virtual reality market is yours for the taking

The metaverse is vast and continuously expanding. No matter what metaverse platforms and digital assets you choose to invest in, there will always be opportunities for you to succeed. 

The road is rough, and there are days you will feel disheartened. But choose to continue learning and growing. Every experience will unlock a new chapter in your success story.

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