on the crypto
The hot topics of the month continue to be NFTs and the Metaverse. A sharp rise in interest from mainstream gamers and the rise in NFT and Metaverse brand applications indicate a great year ahead for digital assets and virtual reality.
In February, NFT trading volumes may have fallen from their all-time highs in January. Based on the news traffic, however, it could prove to be a pause. For the Metaverse, companies and industries are drawn to the endless opportunities that the Metaverse presents.
Big names enter the Metaverse
It has been an active start to the year for the Metaverse, with some big names entering the virtual world. Last week, Gucci bought LAND in the Sandbox (SAND). This follows McDonald's and its celebration of the Year of the Tiger. Music giant Warner Music Group has bought a piece of land on the beach in Decentraland (MANA). Following the news of Tennis Australia going virtual for the Australian Open, a 4-day digital fashion week is also planned for Decentraland.
Considering the level of interest and rapid progress in creating events in the Metaverse, mainstream players are likely to want to play hide and seek. The Metaverse removes boundaries, giving access to a global audience.
This week, the beauty and lingerie powerhouse Victoria's Secret joined the growing list of leading brands with Metaverse ambitions.
JPMorgan and a $ 1 trillion price forecast
JPMorgan has put its money where its mouth is and has also bought land in Decentraland. The bank ofinvestment US turned bullish on the Metaverse, predicting a $ 1 trillion market in a recently released paper.
Entitled "Opportunities in the Metaverse" JPMorgan talks about the limitless opportunities that the Metaverse presents. These range from the likes of Microsoft creating virtual workspaces to musical artists giving concerts. As a result of the opportunities, the bank sees all types and sizes of businesses entering the Metaverse.
Some key figures from the document include:
- Spending on "in-game ads" will reach $ 18,41 billion by 2027.
- The average price of a virtual plot of land has doubled to $ 12.000 in just 6 months.
- There are 200 strategic partners to date with The Sandbox, including Warner Music Group.
- Spending on virtual goods amounts to $ 54 billion annually.
- Nearly 60 billion messages are sent on Roblox every day.
- NFTs currently have a market cap of $ 41 billion.
With regulatory scrutiny on NFTs and the Metaverse on the rise, JP Morgan noted that many issues need to be addressed, including:
- Regulatory, fiscal and accounting treatment of digital real estate properties of Web 3.0 and of commercial transactions in the virtual world.
- Skillful navigation of the regulatory, fiscal and accounting treatment of virtual worlds mainly of web 2.0 with digital assets of web 3.0.
- Support virtual worlds that are globally accessible but may have local jurisdictional requirements and rules relating to trade and payments.
- Evolution of community governance. (Who sets the rules in virtual worlds?).
The virtual of today against the reality of tomorrow
Considering the above issues and the pace at which companies are entering the Metaverse, a major regulatory change is likely. Today, JP Morgan could have a room in Decentraland, tomorrow they could be virtual offices. Virtual office space would eliminate major fixed costs from business expenses. The COVID-19 pandemic and work-from-home policies have shown that organizations can remain a “going concern” without entire “in-office” workforces.
At the end of last year, we reported more than 1.300 Chinese companies filing Metaverse-related trademarks by mid-December. A few months earlier, the number of deposits had stopped at just over 100.
