NFTs and Making Money In The Metaverse
How excited are you about the metaverse? If you’re in business, there will be many opportunities to make money in what’s commonly referred to as the new internet.
Getting in as an investor while the Metaverse is in its infancy (alpha version) is like being one of the first investors on the internet, and we know how that worked out – they became multi-millionaires!
If you’re into tech innovation, you will also be looking out for opportunities. There is a lot of investment happening right now. For example, Meta (formally Facebook) spent $10 billion on Reality Labs research in 2021, developing VR headsets and AR technology. The Meta family has grown to circa 72000 employees.
Meta is not alone either see our earlier article for a list of some of the businesses building the metaverse.
While we put together a quick overview, for a more detailed explanation of the metaverse, it’s hard to look past this blog post that really has everything covered from its core characteristics and how to join as a member or user. Two traits that stand out are freedom of movement and decentralized commerce (DeFi) with cryptocurrencies.
One characteristic is the metaverse is genuinely open and without boundaries. There are no limits to what you can do, where you can go and how many people can be part of it. No one can say precisely how the metaverse will evolve. In its alpha, there are still millions of users but not billions!
Once again, it is the wild west, and the lack of rules around social etiquette is challenging. For example, in Meta’s Horizon Worlds, users feel vulnerable and harassed. Some users say they believe they have been virtually violated!
How to get around anti-social behavior in the metaverse? According to Meta, tools and features can keep users safe. For example, a part creates a bubble around an avatar to ensure personal space, and no other avatar can touch them.
The metaverse is exciting in the freedom it promises users. This is the best trait since no one can claim to own the metaverse. Plus, virtual economies have created marketplaces for buying and selling powered by cryptocurrency blockchain technology.
Think about how restricting and closed the social media platforms are, plus users lack real control over their data! The metaverse is the opposite, and via your avatar, you will be able to create, sell, and invest between metaverses.
Investment and Business
How can you make money in the metaverse?
First, you need to know how to access metaverses. While you can freely access metaverses like Decentraland, Felicia Hou says other platforms have hardware and software requirements and a crypto wallet. For example, The Sandbox is a virtual world for gaming, and you’ll need a crypto wallet to get in.
For the full 3D immersion experience, you’ll need more than just your smartphone accessing an app. Hence the need for hardware like AR glasses and VR headsets. If you’ve been gaming for a while, you may have a headset. A few players in the VR headsets space with Apple also eyeing it up.
Events like Gucci Garden on Roblox need the hardware for full 3D immersion. The metaverse is all about activities – participating in:
- Events, shows, exhibits, tours
- Games, sports
- Meetings, training, learning, work
- Collaboration – projects, design
Brands and Celebrities
Many brands are all over the metaverse creating and selling NFTs. Nike, Gucci, Ralph Loren, McDonald’s, Taco Bell to name a few. For example, Nike just bought a virtual shoe company that makes NFTs and sneakers ‘for the metaverse’.
The competition to be first in mind is heating up. Nike is sending out a tough message to competitors to back away from any activity that threatens their brand position. For example, did you know Nike is suing StockX for copyright infringement i.e. using its logos on creating its sneaker NFTs?
Copyright infringement litigation will be a booming business with brands going all in to protect their NFTs.
Plus celebrities are also in on the action with Snoop Dog, Paris Hilton leading the way. The sky really is the limit to what will be created as NFTs.
For example, a Forbes article mentions Jadu creating a game called The Mirrorverse – using AR and involving 3D NFTs. To play the game, you need transport, so you bring your own NFT avatars but buy the NFT transport like jetpacks and hoverboards.
Celebrities including Lewis Hamilton, Grimes, and Snoop Dog (also investing in land in The Sandbox metaverse) have NFT hoverboards. Jadu sells them usually for the same price – which is quite low.
Buyers fortunate enough to be in the right place at the right time can resell the NFTs in the secondary market, and this is where the profit is made. It’s a sellers’ market, and they can name their price. The same NFTs can be bought and sold continuously, making each owner a profit. Investors or some may call then speculators can make their money trading in the metaverse.
There are a few ways to make money, just like celebrities and businesses.
Create and Sell NFTs
Creators can mint their creations as NFTs on marketplace platforms like OpenSea, Nifty Gateway and more.
Non-fungible tokens are unique units of data that use cryptocurrency blockchain technology (mostly Eth) to register and authenticate digital content. For more information on Blockchains see this article.
NFTs have grown in popularity like wildfire with artists, musicians, writers, and poets! However, like with everything new, there are still challenges with the technology. For example, NFTs are in two parts – the smart contract and the asset. Both can be stored on the blockchain as on-chain NFTs, or the asset can be stored on a decentralized storage network an IPSF which is aiming to be a peer to peer network for file storage in much the same way the BTC is a peer to peer currency.
You can choose where to store the digital asset, and the gas fee associated with using the blockchain reflects where the asset is stored, e.g. on-chain or decentralized. Don’t be put off by the technology as non-techies can create NFTs.
Types of NFTs
Some of the different types of NFTs include:
- Virtual land
- Virtual items e.g. wearables, games, currencies
- Virtualized real-world assets – e.g. real estate, cars, stock, race horses
Virtual Land vs Virtualized Real Estate
Some NFTs are just for the metaverse, like virtual land in The Sandbox. While virtualized real-world assets are something completely different. Asset Tokenization is real-world ownership turned into a digital token. For example,
Your home could be turned into an NFT, and you, as the digital token owner, have a real-world legal claim to the house. It is the same ownership as owning the title deed.
Did you know NFTs are not exclusively for the metaverse?
You can create and sell NFTs without ever entering the metaverse. However, remember the NFT is using the blockchain, and when you use the NFT marketplaces like Rarible, Mintable, OpenSea and so on, you’re using your Ethereum-based wallet. It’s a quick step and a jump to the metaverse for marketing your NFTs to what will be millions of users.
Most Notable NFT Collections
Bored Ape Yacht Club (BACY) tops the list of most popular NFT collections. Being a limited collection of just 10,000 the average cost to purchase a BACY NFT is circa $330,000 but don’t be fooled by that low number as recent sales are 1.4 million and rising.
Other collections selling well include:
- Clone X
- The Sandbox
- World of Women
Worth a mention here is buying and selling virtual land NFTs. This may seem a bit of a stretch, but virtual land plots in The Sandbox are selling like hotcakes, and it’s not just celebrities getting in on the action. If you have got a piece of the action with a virtual real estate NFT in The Sandbox, you’ll be comforted by the knowledge that global consulting firm PwC is a neigbor.
When you buy a virtual land plot in The Sandbox, you can develop it, or you can land bank, i.e. hold it in its undeveloped state and sell it later on for a premium price far more than what you paid for it.
PwC intends to develop their virtual land plot and that’s good news for all landowners in The Sandbox. Development is what attracts users, and it’s why The Sandbox has free tools available so landowners can develop their plots as they see fit.
The secondary marketplace for land plots in The Sandbox is heating up. If you paid 2 Eth for your standard 1 plot a few months ago, it’s likely to get four or more times that today.
As an investor, the buy and hold strategy works for capital gain, and if you rent the plot and earn a rental income, it’s even more valuable. For a business, you can see the opportunity in developing it to sell services or products, which may be real-world or NFTs like art or wearables.
There is already a huge market for designers, developers, architects for developing NFTs and the metaverse. Plus, techies with skills and experience with everything to do with cryptography, private key wallets and safety. Within a few years, there will new roles for the Metaverse too like:
- Metaverse planner
- Ecosystem developer
- Metaverse research scientist
- Metaverse hardware builder
- Metaverse storyteller
- Metaverse cybersecurity specialist
Watch This Space
The more we learn, the more we need to know about the Metaverse, so watch this space as more articles come online for your knowledge and interest.