As the metaverse – or virtual reality world increasingly powered by cryptocurrencies – continues to boom, it’s becoming hard to pick the industry's winners.
While real-estate plays like The Sandbox, Decentraland and pokemon-like game Axie Infinity (which rocketed as much as 30,000% this year) lead the market, a slew of emerging tokens are also set to rise sharply on the back of unique business models, experts say. They highlighted Yield Guild Games, Audius, Boson and Star Atlas as the most promising.
Yield Guild Games or YGG, is building a fledgling play-to-earn community where global users can play a wide array of games to earn tokens. By enabling this, players in developing countries, such as those in crypto hub Southeast Asia, can earn income while engaging in combat games. Audius, meanwhile, is building the metaverse’s first radio station in partnership with metaverse real-estate firm DeFI Land.
Similar to Spotify but for the decentralized world, Audius has received funds and endorsements from celebrities including Katy Perry, and Pusha T. Boson, meanwhile, is building the metaverse’s first decentralized e-commerce platform, enabling anyone to sell physical goods as NFTs in Decentraland’s Vegas City, where Atari recently opened a Casino.
“We are working toward a metaverse retail experience that is immersive and thrilling, where shoppers will wander through virtual malls with their friends, trying on clothes and getting a far better, 360-degree view of how they will look,” Boson wrote in a blog, adding that the merchandise will be physical delivered to customers.
“These tokens are becoming increasingly popular,” confirms Rosh Singh, CEO of crypto exchange start-up Quadency. He likes Star Atlas, a new space-war game built on the Solana blockchain.
“Fans love their intergalactic universe where they can participate to build a space colony and buy land or spaceship equipment with non-fungible tokens (NFTs)," Singh said. "NFTs confer unique ownership of digital assets and have taken the world by storm this year, minting new millionaires trading art, collectibles and now game creatures and tools."
Move next to Snoop Dogg
Meanwhile, metaverse real-estate is becoming all the rage, with investors including rapper Snoop Dogg. The singer recently built Snoopverse on The Sandbox where he also has a digital twin of his mansion. Players, dubbed Snoopites, can hang out and attend exclusive parties and events. The scheme has become so popular that a mysterious investor spent $450,000 this month to move next to the star.
Metaverse real-estate is “just like the real world where the value of land is proportional to where there is strong demand,” adds Singh. “In Decentraland, you have Genesis Plaza [its epicenter]. The closer you buy to that, the higher the value.”
As metaverse landfills grow, experts see a unique opportunity to lease spaces to advertisers such as Nike (NKE), Gucci or Rolex.
“As with anything, value comes from usage and as these games take off, there will be growing viewership and usership so naturally, the likes of Coca-Cola or other big brands will want to buy a billboard or advertise in the center of these cities,” Singh notes.
Singh has skin in the game. He recently purchased a land plot on Decentraland where he notes parcels can average 10,000 MANA (the network’s token) or $30,000.
Crypto investor Brian Evans agrees real-estate holds great promise.
“Buying land as NFTs is a really good opportunity,” he adds. “It’s like going to Los Angeles or New York 100 years ago. There is going to be a lot of upside.”
Evans expects metaverse use cases will expand sharply, especially as the decentralized Internet or Web 3 takes root in the virtual world, which people can access through goofy spectacles, notably Meta (FB)'s Oculus gear, which led Christmas sales.
Merav Ozair, a blockchain expert and Rutgers Business School professor, agrees, adding that the metaverse could disrupt education.
“Education and learning will be a big beneficiary,” she notes. “Education is pretty expensive but once you create a metaverse emulating in-person experiences, you will be able to learn from anywhere and with anyone. You won’t have to spend tens of thousands to travel to a particular school.”
Meanwhile, analysts say the metaverse will be a boon for cryptocurrencies, noting that its development will mark an inflexion point for their usage. As virtual-world platforms take off, stablecoins will likely win the race as most tokens are still too volatile.
Ozair agrees: “The metaverse is a virtual world; you cannot function without virtual currency."
"I am advocating for a truly decentralized, algorithmic-based stablecoin, something similar to DAI (an Ethereum-run decentralized currency pegged to the dollar) or even better,” She adds. "So far, Bitcoin can’t scale and Tether has too many regulatory issues and question marks.”
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.