Are Metaverse Projects Doomed?
“Metaverse” is one of the biggest buzzwords in NFTs. The idea of it is magical – truly decentralized virtual land you can own with no limitations. From shops and bars to casinos and amusement parks, the ability to hang out with friends from around the world in a shared space is appealing. In many ways, perfecting the Metaverse is the final frontier for NFTs.
However, in the same breath, I’ll tell you that the metaverse projects like Decentraland and The Sandbox are the most vulnerable projects in the NFT space. What they’re doing is groundbreaking; the people running these projects are pioneers that are shaping the future of technology. And yet, I worry about their ability to stand the test of time. The concept of the metaverse is so powerful that I believe that this is the area where big companies will begin to take over sooner than later.
The opportunity is too great for companies with unlimited resources and strong brands to keep sitting on the sidelines. Right now, the market for Metaverses is you, the person reading this article. You’re a tech-forward geek who loves NFTs. Now compare that to Minecraft and Roblox which have a combined 500 million active users. What happens when Rockstar, the makers of Grand Theft Auto and Red Dead Redemption, get involved? How about Bethesda who makes Fallout and Elder Scrolls? And this is just skimming the surface.
Two things must happen to save the current metaverses.
First, they must continue to make a strong commitment to the NFT community. Continue to work hard to partner with NFT projects that have strong brands. In the short term, it’ll help build a larger audience. In the future, these metaverses can utilize the established IP from those projects, who have a firm foothold in their project. That’s a unique value proposition they want to keep.
Second, they need companies to be too scared, greedy, or risk-adverse to get started, delaying their entry into the space. Up front it’s going to cost a lot of time and money to build out an effective metaverse with personalized ownership. You need to figure out your blockchain and hire new talent. There are legal challenges that come from item sales. The list goes on. If companies don’t want to take that short term loss, they could delay long enough for at least one current metaverse to build a moat.
There is a third option, which could be the best of both worlds.
The scenario where big companies acquire the current crop of metaverses. The big companies get the technology for their own franchises but let the current metaverse projects continue to build out their decentralized worlds. It would give both the opportunity to exist, with both backed by endless funding. I know it’s not ideal… we’d all like to keep things the way they are. But large companies coming to NFTs soon, and the metaverse feels like a place where big brands could have a big leg up.
Disclaimer: This article is not financial advice. The NFT and Cryptocurrency markets are very volatile. Please don’t invest what you can’t afford to lose. Always do your own research before investing.