Is it safe to Invest in a Metaverse Project?

Every crypto news blog you read, every crypto video you watch, there’s a talk about metaverse.

Since Mark Zuckerberg announced on October 28 that Facebook would now be known as the Meta Platform, or simply Meta, there’s a buzz surrounding the topic.

So, what exactly is metaverse, and should you invest in it?

Let’s find out!

What is metaverse anyway?

The metaverse is an idea that involves the creation of an alternate universe in which people may mold their appearance to be anyone they want to be.

They can carry out real-world activities such as shopping, gaming with friends, and other actions.

Cryptocurrencies and non-fungible tokens (NFTs) make it simpler to acquire and sell items inside the metaverse. This results in expanding economic potential.

But, more significantly, these exchangeable tokens will ultimately let you move your virtual identity and products between metaverse realms.

Investing in Metaverse 

There are two major concepts for investors to consider in the metaverse universe: infrastructure and games themselves.

So we explore two pieces of the puzzle: games with blockchain compatibility via NFTs and tokens and protocols that provide infrastructure for game producers to create blockchain-compatible games.

MANA, for example, is the token of Decentraland, a virtual reality platform based on the ETH blockchain that allows you to create, enjoy, and monetize content and apps. According to the whitepaper, users in this virtual world buy chunks of land that they may subsequently travel, develop, and monetize. 

MANA, which has a market worth of $6.5 billion, has been on an upward monthly trend, increasing 249.2 percent in November. The total market capitalization of the metaverse is at $36.7 billion.

Is it all about games?

No. gaming is an obvious first step, but the metaverse is much more in a larger sense. For example, Ariana Grande and Travis Scott have performed in Fortnite, and Lil Nas X’s Roblox performance last year had 33 million views.

Otium Capital creates immersive music experiences for the metaverse, working with David Guetta and Snoop Dogg.

This trend is grabbing gamers who want to own the worth of their time spent in-game and has grown extremely popular in underdeveloped nations like the Philippines and Venezuela.

ETH, the big winner?

ETH is the main winner in the thriving metaverse field.

Ethereum is the protocol for most blockchain gaming, and metaverse coins are constructed.

Consider these metaverse games as applications and Ethereum as the App Store. We anticipate a supply shock for ETH due to metaverse adoption and recent modifications to Ethereum’s supply growth.

Risks related to the metaverse

Many people are concerned that the metaverse would witness battles over intellectual property and ownership, data protection, content licensing, and risks associated with crypto assets.

The largest risk for investors, though, is determining whether firms truly understand how to create a fascinating metaverse that people will want to join.

What should you look for as an investor?

Regarding what indicators investors should look for when investing in metaverse-linked currencies. Most currencies in the metaverse and gaming world are not among the top 100.

Because it is early, you should focus on standard measures such as market capitalization, volume, transaction count, and protocol revenue.

You’ll also have to do some digging since it’s such a young ecosystem, and most metaverse currencies have a market valuation of less than $1 billion and are quite volatile, so you’ll have to do a lot of research.

Final thoughts 

Metaverse provides a good investment opportunity. However, we are still in the learning phase of how the technology will perform. 

You should do proper research before jumping into the metaverse pool as an investor.