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Market Bytes: Step Into the Metaverse

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The COVID-19 pandemic has upended almost every aspect of our daily life, and the world was forced to rapidly adopt a new digital norm overnight: remote work. In an effort to help slow the spread of COVID-19, businesses and schools shifted to implement digital solutions. 

 

As our lives have become increasingly digital, we’ve embraced opportunities to live and work outside of major cities—often in search of more space and comfort. Companies like Coinbase, Slack, and Twitter are realizing that people are able to work efficiently in a remote setting, and are adapting to that new reality by implementing remote-first policies.

 

Authentic Digital Experiences

 

In a geographically distributed world, the need to maintain authentic relationships becomes increasingly important. Our digital world and physical worlds are increasingly blended. That’s partially why the metaverse is generating so much excitement. Facebook changing their name to Meta to be “metaverse first, not Facebook first” is a visible embrace of this new digital reality.

 

So, what’s the metaverse?   The metaverse is where digital experiences take place; it’s about bridging the gap between physical and virtual experiences, such that the two feel seamlessly connected. Concerts, for example, might begin offering digital experiences equally as exciting and immersive as the physical event. 

 

Seamless interoperability between the digital and physical also means owning one’s own digital items. Blockchain projects, like Decentraland (token ticker: MANA), have created an open-world metaverse where players can log-in to play games; earn the metaverse’s native Ethereum ERC-20 token, MANA; and buy and create NFTs, like virtual land (token ticker: LAND) and various collectibles. All of these features give them real-world interoperability for the value of their time spent in-game. Like MANA, Facebook’s stablecoin, DIEM, will also have Ethereum compatibility, where  gamers can also extract real-world value from in-game items, while simultaneously creating a billion dollar secondary market for game developers.

 

The Meta Market Opportunity 



We know that a greater portion of our attention is spent on digital activities — a trend that’s continuing to increase with younger generations. Today, on average,  around one-third of our lives (~8 hours/day) are spent on leisure activities, like watching TV, playing video games or scrolling on social media. That amount of time spent will likely increase as remote work continues to normalize. 

 

As such, revenue is likely to continue to grow as digital worlds continue to embed themselves into our daily lives.  A fast-growing virtual goods consumer economy is emerging alongside the convergence of our social lives and online gaming. It is estimated that revenue from virtual worlds could grow from ~$180 billion in 2021 to ~$400 billion in 2025

 

The continued shift of game developer monetization is a key dynamic within this growth trend. Players are increasingly moving away from “paying to play” premium games, and are moving towards “free” games, which developers monetize by (1) selling players in-game items to enhance gameplay, or (2) allowing them to gain social status within these virtual worlds.  

 

Breaking Down The Walls

 

Today, the digital world is a hallway of locked doors, each requiring unique credentials to gain access. In the metaverse, users will have seamless, real-world adjacent interactions with entire digital communities. Building applications on open networks, like Ethereum, removes the unnecessary barriers between digital ecosystems. For example, logging into DeFi applications is as simple as scanning a QR code with your digital wallet.

 

Open networks, like Ethereum, also give users true ownership of their digital items. For example, in an open network, Instagram wouldn’t “own” your photography, but instead would enable you to display them in a virtual setting (e.g., your property on Dentraland) by connecting your wallet; similarly,  you would be able to seamlessly remove these photographs from one virtual setting and move them to another — without having to close your account or revoke your credentials. .

 

The metaverse can be an important extension of our digital reality, transforming our digital experiences by making them immersive, seamless, authentic, and truly user-owned. Digital experiences have the opportunity to become as exciting as the physical experiences. Imagine: a concert from the seamless convenience of your home, a picture frame in your virtual home with a rotating virtual art collection, a consistent digital brand with the same profile picture across all your platforms, and a world in which you own the value of your digital data and identity. 

 

To the extent you’re interested in learning about or investing in MANA — the native token of Decentraland — we invite you to consider the Grayscale Decentraland Trust, which is available to accredited investors here.



*For natural persons, annual income in excess of $200,000 a year (or $300,000 per year with a spouse or spousal equivalent), or net worth over $1 million either alone or together with a spouse or spousal equivalent, excluding their primary residence, or hold in good standing their Series 7, Series 65, or Series 82 professional certifications. Entities must have $5 million in liquid assets, or all beneficial owners must be Accredited Investors.

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