Modern technology has created various new industries and transformed our lives previously unconsidered. Since the 1990s, we have associated VR with science fiction movies and novels. However, recent Zukerberg’s announcement of the metaverse led to the rapid development of VR and AR technology. Consequently, it sparked the interest of Wall Street in metaverse stocks.
In principle, the metaverse has plenty of room to grow and become as big as the Internet. The general concept is similar to the Internet we know with the addition of avatars. Metaverse would allow users’ avatars to interact and participate as well. In addition, it would have an economy of its own.
What is Metaverse?
The metaverse is a conceptual universe that combines various virtual spaces into a 3D world. Many think of it as the future of the Internet. The metaverse allows users to interact with each other in 3D spaces.
Currently, this concept is still a work in progress and doesn’t exist in such a capacity. Nevertheless, some games have already started offering metaverse-like elements. In fact, game developers have pushed the envelope with the emergence of virtual economies and in-game events.
Metaverse doesn’t necessarily require cryptocurrencies. However, cryptos are virtual money and, therefore, could be a good fit for transactions taking place in virtual reality. Users could also benefit from storing their digital coins in various crypto wallets.
In addition, blockchain could contribute to this emerging technology as well. Aside from having a robust decentralized governance system, we can use blockchain technology to enable transparent and reliable transactions.
Looking ahead, the tech giants will probably try to lead the way. However, the blockchain industry could favour smaller players and allow them to participate in the metaverse development.
Defining the concept of the metaverse
The metaverse is a 3D virtual space where users can interact and experience multiple life aspects.
For example, the Internet has numerous websites we can access through one browser. Similarly, the metaverse will connect different platforms.
Neal Stephenson was the first to bring up this concept. He did so in his science-fiction book called Snow Crash. Although the general public initially perceived the concept as fiction, it is now moving closer to reality.
The augmented reality will power the metaverse. In this reality, every user will have complete control over their avatar and character.
For instance, users could be sitting in a virtual office and having a mixed reality meeting with a VR headset. In addition, they would be able to manage their portfolio and other financial transactions in the metaverse.
Various apps already aim to bring together some elements of our lives, such as Gathertown. However, these games aren’t the metaverse, just the closest to being one. The actual metaverse does not yet exist.
The metaverse is a conceptual framework that will combine various digital identities, applications, economies, and decentralized governance.
Will Metaverse Use Crypto?
Despite providing a 3D representation of the metaverse, games typically do not cover all life aspects necessary for a truly immersive experience. On the other hand, crypto can offer many key components, such as digital proof of ownership, governance, accessibility, and transfer of value.
The metaverse will enable users to work and shop within the virtual environment. Therefore, there’s a need to develop a secure way to show ownership and transfer money.
Consequently, the blockchain and the metaverse will probably become even more integrated.
Metaverse-friendly characteristics of blockchain
- Control and governance
The ability to control the rules of the metaverse will empower users’ interactions in this world. However, the metaverse also needs ways to implement fair governance. At the moment, blockchain seems to be the best option.
- Digital proof of ownership
Users can prove ownership of any asset or activity on the blockchain by owning a wallet. A wallet is a secure and robust method for establishing a digital identity. It allows us to store and record details of transactions on the blockchain.
- Transfer of value
The transfer of value in the metaverse helps prevent getting lost in the shuffle. For example, if users regularly spend large amounts of time in a multiplayer game, they will need a secure currency.
- Blockchain growth
Due to the nature of blockchain technology, it is constantly improving its compatibility with other platforms. Projects like the AVAX and the Polkadot are developing mutually-interacting blockchains. As metaverse will connect many different projects, blockchain solutions could be the way to go.
Investing in Early-Stage Metaverse Stocks
The metaverse is still in its infancy and has plenty of room for improvement in its current state. It is a soup of early-stage technologies. The software layer of the metaverse will need an improved cloud infrastructure, new operating systems, and fully immersive apps. It will lay on top of virtual and augmented reality hardware.
The market growth will be slow. It might even take a decade or more before the market matures. However, despite the pace of development, some companies are already investing in metaverse-related products.
Therefore, investors interested in metaverse stocks will likely search for companies developing compliant products. Currently, AR and VR glasses seem to be the main gateway to entering the metaverse market for most companies. For instance, Apple is supposedly looking to enter the market by developing pricy AR glasses for early adopters.
Augmented Reality Glasses Today
For AR glasses to be truly comfortable, they need to weigh less than 100 grams. However, that is still up to four times heavier than a regular pair of sunglasses.
As of now, actual AR headsets are purely in the service of enterprise use cases. Even though smart glasses like Snap Spectacles 3 and Ray-Ban Stories can record content, they lack the waveguide technology to experience AR truly. A waveguide technology adds AR capabilities to a headset. However, it increases the cost in return.
The hype around the metaverse will drive more companies to explore AR. But augmented reality adoption will only happen gradually. So from the investors’ perspective, it could be challenging to pick the right AR metaverse stocks.
Metaverse and Education
The need to provide students with learning methods based on modern technology is rising. Because of the pandemic, students and teachers have developed a new level of tech-savviness. With the right tools, students can now cope with the constraints of synchronous classes.
James Simpson, the creator of Copper Candle, shared his views on the future of education. He imagines a virtual human being teaching kids in a virtual classroom while providing them with unlimited resources.
How farfetched this concept is, is yet to be seen. But as for investors, companies developing virtual classrooms could be perceived as future metaverse stocks. Some of the companies offering such platforms are Mozilla Hubs and Virbela.
Metaverse and Facebook
Ever since Zuckerberg announced the metaverse, the Internet has been confused about its meaning. Even though there is an explainer on the site, the conception of the metaverse is still not clear. However, we know it will use various augmented reality and virtual reality technologies to bring people together under a single platform.
Facebook is already huge, and users can find it on various devices such as desktop computers, mobile platforms, and smart displays. But it is still just a social media platform that combines a feed of posts with a marketplace, direct messages, and video features. Facebook is the place to check on people you know and learn about nearby happenings.
The metaverse wants Facebook to become more than a social platform by marrying AR and VR experiences with its existing platform. In his hour-long introduction to the metaverse, Mark Zuckerberg explained how AR and VR would allow people to connect even more with their loved ones.
Instead of sending and receiving messages back and forth, people will connect through AR and VR. The goal is to make the metaverse a big-picture concept that eventually becomes a combined platform.
Will Meta Succeed?
Facebook/Meta’s strategy is to consolidate technologies and spread a broad concept to create a powerful platform.
Even with all of the hype that the metaverse has received, success is not guaranteed. The concept might be too dystopian for customers, and they lose interest. In addition, this project is massive, with many different angles and plenty of competition. Some of those angles will be hard to sell to the general public.
Although Facebook owns Oculus, it’s not the only player in VR hardware. Other companies like Valve and HTC are also in the industry. Furthermore, Facebook’s Portal smart displays are still a distant third to Amazon’s Echo Show and Google Nest Hub.
Even though Facebook is working on AR glasses in Project Nazare, it’s still a long way from becoming a mainstream product. Nevertheless, Facebook’s future is in the metaverse, and every fight that it loses is a massive chunk of that.
Metaverse and Fashion
Fashion brands and retailers took their events and operations online in response to the pandemic. However, this shift wasn’t just about luxury brands and retailers finally focusing on e-commerce.
Instead, the pandemic made way for the birth of digital showrooms. People can now interact with clothes through virtual reality rather than relying on their imaginations to see how a garment would fit.
Costumers can take a 360-degree look at a product and zoom in on even the smallest details. Then, with the help of a few clicks, consumers can virtually try on different products by dragging them onto photos of themselves.
So the future of fashion is not about going to a store to try on clothes. Instead, it’s about being able to experience the goods and services from home.
As fashion becomes more immersed in the metaverse, two forms emerge, the fully digital and the combination of physical and digital. The former sells clothes to an avatar, while the latter refers to the ability to wear clothes using AR or VR.
Thinking about fashion metaverse stocks, it seems that blending the real with the unreal is a must for fashion companies to succeed in the future.
The Future of Fashion Metaverse Stocks
Designers and brands need to understand how to reach their target audience while mastering digital tools.
For example, for their Fall 2017 collection, Balenciaga released their clothes as video game items. The success of this project has allowed digital versions of the in-game items to out-sell their physical counterparts.
In addition, for their own in-game collaboration, Gucci created a limited edition Queen Bee Dionysus bag that was sold digitally for 350,000 Robux. In fiat money, this amounted to over 4 thousand dollars, which is more than the actual value of the bag.
Metaverse and Work
The metaverse will combine various aspects of life into one place. For example, after the pandemic, many will remain working from home. The metaverse will allow them to interact with their colleagues in 3D. Workers will be able to enter their 3D office and interact with other colleagues as avatars.
The future of work may also be related to the metaverse. For example, it could provide users with income usable in the metaverse. GameFi and play-to-earn models show that people are willing to work in virtual worlds. Although play-to-earn games like Gods Unchained and Axie Infinity don’t have 3D worlds or avatars, they could still be considered metaverse candidates.
Will Metaverse Replace the Internet?
The metaverse is not a replacement for the Internet. On the contrary, the Internet is a vital part of accessing metaverse. Users will share holograms, virtual spaces, and experiences using the Internet.
The metaverse can be an evolution of the Internet. Over the past couple of decades, the Internet has evolved into a place where we can manage various life aspects.
Similarly, the metaverse will create a new generation of technology. It will allow users to communicate and conduct their business. In addition, it will merge crypto, AR, VR, and blockchain technology.
Metaverse is not an isolated universe. On the contrary, it consists of interconnected virtual worlds with universal device support.
In actuality, users will access the metaverse through internet-powered devices.
How to Invest in Metaverse Stocks?
We are in the early stages of metaverse development. Therefore, it is difficult to say with certainty which companies will benefit from this technology. However, we can broadly segment the environment into several categories investors can look into when searching for metaverse stocks.
Although it’s not likely that retailers will be able to compete with the likes of Amazon and eBay, they could still find a place in the metaverse. For example, a company that sells physical goods online could benefit from an immersive shopping experience.
It can also be the company selling virtual products. Nike, for instance, has filed a series of patents aimed at making it the leader in virtual apparel.
With the increasing popularity of digital real estate, many people are looking to invest in virtual land. This can be an excellent opportunity for seasoned crypto investors as they are already familiar with the world of digital currencies.
Investors can buy land in the metaverse depending on the type of venue. Some platforms are already starting to sell digital real estate despite the metaverse’s infancy. Some of these include The Sandbox and Decentraland. In addition, the companies are accepting non-fungible tokens as means of payment.
When a person purchases a piece of metaverse real estate, the blockchain network that powers the platform will verify the transfer of ownership and sale. For instance, Atari, a Japanese video game company, purchased 20 parcels of land in Decentraland and built its very own crypto casino. Atari’s decentralized gambling platform allows gamblers to place their bets and receive payouts in crypto tax-free.
Technology companies are already working on accessories that allow players to experience the metaverse in new ways. Expect next-gen VR headsets, controllers, and other equipment. Current players that offer consumer-focused sets include Meta and its Oculus Quest and Sony and its PlayStation VR. There is also HP and its Reverb.
The top requirement for metaverse development will most likely be unprecedented computing power. Therefore, companies in this niche could be the future metaverse stocks.
Cloud-based platforms like Amazon.com and Microsoft’s Azure might benefit from such development. But, going deeper, investors could also look at the companies that make the high-powered silicon needed to power metaverse servers. One of such companies is Nvidia.
The other key requirement for the metaverse is that it will have high-quality internet access and high speed with zero latency. 5G and broadband are also important components of the puzzle.
Nevertheless, the key piece will probably be content delivery networks. When addressing content delivery networks (CDNs), companies like Fastly and Akamai provide the necessary infrastructure to support the increasing user base.
Fungible tokens power metaverse projects. These are digital tokens used to purchase digital assets, such as virtual land or outfits for virtual characters. We can also use them to buy fiat currencies or crypto.
Metaverse cryptocurrencies can allow their holders to vote on decisions related to the platform. For example, such decisions may entail which features to develop first or spend the money next.
Due to the rise of digital assets, the value of the associated tokens will likely increase.
The Future of Metaverse Stocks and the Metaverse Economy
Even though lives are slowly returning to their pre-pandemic state, employees are hesitant about returning to offices. Remote work opens new opportunities for collaboration and success. The future of work in the metaverse appears more convenient and streamlined for employees and employers alike.
The future of commerce will evolve, and the metaverse will accelerate it. For example, instead of going to a physical store, consumers will be able to experience products through virtual and AR experiences.
The metaverse will also enable more immersive in-store experiences. For instance, with VR and AR, consumers will be able to try different products, regardless if they’re in stock or not.
Due to the global popularity of Facebook (now Meta), companies are striving to develop technologies to complement the metaverse. It is safe to say that one of these companies will lead the metaverse stocks of the future.
The metaverse might seem like a buzzword in the tech world, but it’s already rooted in society. Furthermore, due to the massive global digitization, the metaverse is no longer a sci-fi future.
Top Metaverse Stocks
Here is our list of prominent metaverse stocks on the market.
Meta Platform, Inc., doing business as Meta, is a multinational technology company founded in Menlo Park, California. Facebook (Meta) is also the parent company of other subsidiary companies like WhatsApp, Facebook, and Instagram.
In addition, meta is a part of the Big Five American Information Technology companies, including Amazon, Google, Microsoft, and Apple.
Meta generates a significant portion of its revenue by selling ad placements to marketers. In October 2021, Mark Zukerberg reported that Facebook’s parent company would change its name to “Meta” to reflect its focus on the metaverse. Later that month, the company officially changed its name.
During Q3 2021’s earnings call, Facebook’s CEO Mark Zuckerberg talked about the company’s ongoing criticism and the efforts to build a metaverse.
The company’s new metaverse vision and the name “Meta Platform” were introduced at the Facebook Connect event on October 28, 2021. The name change happened in response to the company’s public relations campaign that shifted its focus toward the world of digital.
This metaverse stock is listed on the Nasdaq Stock Exchange, and the symbol is FB.
Company website: https://about.facebook.com/
Roblox is an online game platform that enables users to create and distribute games. Started by Erik Cassel and David Baszucki in 2004, Roblox lets users create games with various genres in the programming language Lua.
Due to its lack of press coverage, it was relatively small as a company and a platform for most of its history. However, it started to grow significantly in the second half of the 2010s. In addition, when the COVID-19 pandemic broke out, it only accelerated this growth.
In August 2020, Roblox had more than 164 million monthly active users. Although critics gave positive feedback, many have slammed the game for moderation and alleged predatory practices directed at children.
Through its platform, Roblox Studio, players can create their games. They can then share their creations with other users. The studio utilizes a programming language called Lua to control the game’s environment.
Roblox allows players to buy and sell virtual items to decorate their virtual characters. Although anyone can buy clothes, only Premium members can sell them on the platform.
On the other hand, there are some scams related to Robux. These involve automated messages promoting fake websites and games that promise free Robux.
Company website: https://www.roblox.com/
Nvidia is a US-based technology company incorporated in Delaware. It designs graphic processing units (GPUs) for various professional and gaming markets. Its primary GPU line is called GeForce and is in direct competition with AMD’s “Radeon” brand.
Nvidia’s products include the Shield Portable, the Shield Android TV, and the Shield Handheld. The professional line of GPUs from AMD are used in various workstation applications in fields like engineering, architecture, entertainment, manufacturing, etc.
In addition to manufacturing GPUs, Nvidia also offers an API called CUDA, which allows the creation of parallel programs. They are deployed in various supercomputing facilities around the world.
Nvidia has focused on the mobile market for the past couple of years, making Tegra mobile processors. In September 2020, the company announced acquiring Arm Ltd. for about $40 billion in cash and stock.
SoftBank Group will acquire a minority stake in Nvidia, while Arm will keep its headquarters in Cambridge. Like Meta, Nvidia is also one of the metaverse stocks listed on the Nasdaq Stock Exchange, and the symbol is NVDA.
Company website: www.nvidia.com
Microsoft Corporation is a multinational technology company that produces computer software and various consumer electronics. Its best-known software products include Windows and Microsoft Office suite. Xbox’s gaming consoles and the Microsoft Surface are the company’s flagship products.
It is part of the Big Five American companies. Bill Gates and Paul Allen founded Microsoft in 1975.
Over the years, Microsoft has started diversifying its operations by acquiring other companies such as LinkedIn in 2016 and Skype in 2011.
Microsoft offers a variety of software for various platforms, such as Windows, Internet search, mixed reality, and software development.
Steve Ballmer took over as CEO when Gates stepped down in 2000, and he envisioned a strategy that focused on devices and services. In 2012, the company entered the PC market following the acquisition of Danger Inc. in 2008.
In 2014, Microsoft started focusing on cloud computing after Nadella took over as CEO. The move helped boost the company’s stock price. In 2018, Microsoft reclaimed its place as the world’s most valuable publicly-traded company. Later, in 2019, Microsoft became the third US public company to reach the trillion-dollar mark.
Company website: www.microsoft.com
Unity is a game engine built by Unity Technologies, first announced in 2005. The platform has since been extended to support various other platforms. It is popular with game developers for creating titles such as Pokémon Go and Call of Duty: Mobile. In addition, novice developers often use Unity to create games. It is also considered an ideal platform for indie developers.
Creating 3D and 2D games have also made Unity a widely used game engine. Various industries, apart from gamers, adopted the engine, such as film, architecture, engineering, and the US Armed Forces.
Unity’s primary scripting API is C#, allowing developers to create games and plugins in various languages. Before Unity 5’s release, it supported Boo, but it was later removed following the release of Unity 1.
Company website: https://unity.com/
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This article was last updated on April 7th, 2022.