The metaverse – what you need to know
The metaverse is well and truly here – and it seems everyone wants a piece of it. From global corporates to celebrities, we are seeing money flow into this emerging industry as investors try to get in early on its growth trajectory. Today, we take a closer look at the metaverse, how investor interest has accelerated, and at some of the metaverse pioneers trading on the PrimaryMarkets Platform.
What is the metaverse?
The metaverse is a new technology shift that blends digital technologies including virtual reality, cryptocurrencies, blockchain, gaming, NFTs, and social media. It’s a place where the real world is translated into a digital version, ‘a virtual universe’ where you can create an avatar, buy virtual real estate, attend a musical festival – and more. It has the potential to change the way we live and work, but how it will do so remains to be seen.
Currently, the metaverse is still in the very early days of development with companies around the world working on how different digital technologies can intersect and integrate together.
Then vs now: investor interest in the metaverse
Initial public reception to cryptocurrency and blockchain-related technology was divided. Early on in the rise of the cryptocurrency revolution, traditional financial firms and governments saw cryptocurrencies as illegitimate and risky, while virtual reality technology gained little interest outside the gaming world. Famed American investor Warren Buffet also infamously dismissed bitcoin by calling it ‘rat poison’.
Fast forward to today, and while there are still skeptics dismissing these new technologies, a whole wave of listed and unlisted companies are leading the metaverse technology shift and are growing exponentially. Animoca Brands, for example, was once stripped of its ASX listing for failing to meet governance requirements. Its shares were later listed on the PrimaryMarkets Platform in 2020 at A$0.10 with a market capitalisation of A$100M and now, 18 months later, the company is worth A$7.1B. It’s this level of growth that has caught the attention of more traditional investors and as a result, we’re starting to see a real shift in public perception and investor interest.
For example, Facebook last year announced plans to invest heavily in the metaverse and promptly changed its name to Meta as a sign of its commitment. Japan-based conglomerate SoftBank (investors behind Uber, WeWork, Grab, and others) has backed The Sandbox, one of the fastest-growing metaverse platforms in Asia. It seems even Warren Buffet has come around after investing US$1B in crypto earlier this year. Whether it’s via direct financial investment, championing research, or advocacy, mainstream support is a clear sign that the tide is turning in favour of the metaverse.
The metaverse – how can you take a stake in it?
To invest in the metaverse, you can invest directly in publicly listed companies or via specialist ETFs. Alternatively, you can invest in private companies via PrimaryMarkets. We offer access to major players that are setting global benchmarks in the industry:
Indicative price per share A$4.00 (Value A$7.1B )
Animoca Brands is a leader in the industry with expertise in digital entertainment, blockchain, and gamification. It is invested in The Sandbox, a decentralised virtual world where players can build, own, and monetise their gaming experience. It does this by creating digital assets in the form of NFTs, uploading them into the marketplace, and trading them using SAND, the crypto token used to transact on the platform. The Sandbox has partnered with major brands and celebrities including Adidas, Gucci, and Snoop Dog.
Indicative price per share US$1,380 (Capitalisation US$31B )
Epic Games is a leading interactive entertainment company, provider of 3D engine technology, and owner of Fortnite, one of the world’s largest online games with more than 350 million registered users.
Epic is already experimenting with the metaverse, including breaking records with its Astronomical concert. A live music event held in the Fortnite world, the event attracted over 12 million players within the game, not to mention those watching on streaming platforms.
Epic Games is also the developer of Unreal Engine, the world’s most advanced 3D creation tool that is used across several industries including gaming, automotive, and film. It delivers cutting-edge entertainment, compelling visualisations, and immersive virtual worlds.
Indicative price per share US$700 (Capitalisation US$13.3B)
OpenSea was founded in 2017 and is now the world’s first and largest decentralised NFT marketplace. Think of it as the eBay for digital objects and collectibles, providing a way for content creators to trade digital assets such as avatars, trading cards, and art. Each digital asset comes with a unique ID which means creators can earn royalties from every secondary market sale. OpenSea has attracted several high-profile investors including venture capital firm Andressen Horowtiz, Coatue, Paradigm and also celebrity Ashton Kutcher.