If you keep up with the rapidly growing industry of cryptocurrencies and NFT’s, you have most likely heard about absurd sales occurring in the metaverse. For those who are not aware, according to Joel Elson, the metaverse is basically “an immersive virtual reality version of the internet where people can interact with digital objects and digital representations of themselves and others, and can move more or less freely from one virtual environment to another.” Even though this sounds like the common virtual reality most of us are aware of, there is one factor which makes it different. The buying and selling of properties in the metaverse has grown exponentially in the last couple weeks with one house selling for $4.3 million. The question most have on their minds when seeing this jaw dropping amount is simply why? To be frank, it is hard to know for sure. Unlike the stock market which has many regulations in order to prevent extreme volatility, this concept of digital images being traded is a fairly new concept. As I talked about previously, the world of NFT’s has recently taken over like a storm. With over 110,000 sales last week alone, equivalent to $541 million, it is safe to say that many have put their trust into this concept that is fairly new.
Even though it is evident that the sale of metaverse properties is a concept similar to the sale of NFT’s, the question regarding why prices are so high was never answered. In my mind the reason for these ridiculous prices is fear of missing out once again. With major stable coins like Bitcoin and Ethereum, the majority of the world figured out what these cryptocurrencies were well after insane surges. Then with the concept of NFT’s, once again the majority of the world only became familiar with this concept after ridiculous sales upwards of $10 million had been made. The common pattern with both of these, is that an unimaginable amount of profit could have been for anyone that came into these spaces early. Now with the relatively new concept of the metaverse, all those who missed out on previous “new gen investments”, are truly starting to realize that these concepts are here to stay. With countless big time companies like Facebook(Meta), Microsoft, Apple and Roblox all stating that they will soon interact with the concept of the metaverse, many investors are now willing to put larger amounts into the concept.
In the end, it is significant to note that with every new form of investment comes a lot of risk, which is why before investing into the metaverse a lot of research should be done. Even though big corporations have already started to interact with the metaverse, this does not guarantee that this concept will for sure take off in the near future. The metaverse could possibly never take off, or it could take off as early as the next few months. However, similar to any type of investment, if it does end up skyrocketing in value, those who invested early will be the ones who will profit the most.
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