The term “metaverse” has become the latest buzzword used by many of the biggest tech companies and CEO’s. We have seen Facebook officially changing its name to Meta and Microsoft acquiring the game developer Activision Blizzard for $68.7 billion, saying it would provide “building blocks for the metaverse.”

But what does metaverse really mean, why is everyone talking about it?

What is the metaverse?

You’ll find that everyone looks and defines metaverse differently, you have Meta on one hand describing it as:

“The metaverse is a set of virtual spaces where you can create and explore with other people who aren’t in the same physical space as you.”

On the other hand, Silicon Valley venture capitalist and metaverse expert Matthew Ball describing it as:

“The metaverse is a massively scaled and interoperable network of real-time rendered 3D virtual worlds which can be experienced synchronously and persistently by an effectively unlimited number of users with an individual sense of presence, and with continuity of data, such as identity, history, entitlements, objects, communications, and payments.”

What are the main properties of a metaverse?

1. A virtual world: where you feel more intertwined with the physical world. You can access it using a computer, gaming console, mobile, wearable technology like virtual reality (VR) headsets or other devices.
2. Interconnected: you’ll be able to jump from one metaverse to another using the same avatar (digital versions of people).
3. Social: it wouldn’t be much of a virtual reality if users don’t get a chance to interact with others in some way or another. You’ll be able to hang out with people or even do things together, making it feel as real as possible.
4. Persistent: this means the virtual world is available whenever and wherever you are. When you come back into it, there’s some sort of continuity to it.
5. Connection to the real world: in some visions of the metaverse, be able to control and see some things that are in the real world. Imagine purchasing a black t-shirt in the metaverse and you’ll be able to wear the exact same in the real world.

Why are people so interested in the metaverse?

There is a long list of reasons why this has occurred, the most interesting ones are:

1. It could be the next internet evolution
   It will allow people to live their same life within a virtual world, imagine being able to stay at home and be able to do the same things as you do in the real world.

2. Work and collaboration will consistently move into the metaverse
   Since the pandemic, many things have become digital by necessity – from socialising to shopping to work. Instead of hosting in-person meetings many of us have changed to online video meetings. We are starting to see some companies shift their training into the metaverse. An article by Washington Post said Walmart has started to use VR to train for tasks like using its kiosks and parts of Boeing’s training program, astronauts started using VR for spaceflight preparations. A report by PWC found that VR learners were 4x faster to train than in the classroom.

3. Exciting investment opportunities to be made
   Metaverses will aim to have their own economies inside it. Companies like Decentraland and Sandbox have created a virtual space where people/organisations have bought/sold land in these virtual worlds.

What are some of the major projects being built?

There are three companies that stand out at the moment:

1. Decentraland is a project built on the blockchain that has created a virtual world where user’s can purchase land and socialise. Last month, a piece of land is around US$2,500. It has gained strong traction in the recent year due to the speculation of future prospects for example imagine banks moving their retail day-to-day operations online so you won’t need to go into a bank instead you can go inside Decentraland to access your bank branch.
2. Sandbox is like decentraland, but it aims to empowers users to build, create, sell and purchase digital assets and experiences on the platform. Last month, a piece of land is around US$3,600. For example, in December 2021 Adidas purchased a plot of virtual land and started working to create their own shoes in Sandbox.
3. Meta is aiming to build a real persistent world. For example when you put on a VR headset, you’ll be able to walk into a supermarket to buy your groceries and it’ll be delivered to your door. Although Meta hasn’t released anything yet, they have started to heavily invest in this space. Some sources say Meta will build physical instead of virtual stores to introduce people to devices to access their metaverse. These stores aim to make the world “more open and connected”.

 

Opportunities

Hatchstone is actively monitoring the developments in the metaverse space and investing in selected opportunities with high growth potential. If you are interested in the metaverse or would like to discuss any opportunities with our team, please reach out to us at contact@hatchstone.com