Usually, making an error in your investment thesis leads to poor results but not always. I would know. When I originally acquired some Decentraland (CCC:MANA-USD) tokens, I did so primarily for speculation.
Only a bit later did I look into the fundamentals, which at the time I thought centered on a gaming platform in a virtualized environment.
Only after Decentraland became widely popular and attracted the attention of mainstream news sources that I appreciated the true nature of the blockchain project. This virtual ecosystem is basically one of many burgeoning manifestations of the metaverse, the next evolution of the internet.
By no means am I an expert on the metaverse. Frankly, I find the whole concept terribly strange. Nevertheless, I’m slowly coming around to why so many people view the innovation as the future of connectivity. While the first iteration of the internet brought computers together, the metaverse can connect people through virtual and augmented reality.
So why not just reach out to someone in real life? Well, proponents of metaverse networks like Decentraland will probably argue that centralized governmental authorities impose arbitrary restrictions on the movement of people.
For instance, let’s say you want to talk to your girlfriend Natasha from Krasnoyarsk. Meeting in person (assuming you’re an American) is going to be awfully difficult because of geopolitical considerations. But in Decentraland — or any other metaverse platform — you can connect anywhere you want, no worries about visa restrictions or any other centralized concerns.
On that basis, I can somewhat understand why people will pay a certain amount of real money to establish a stake in a virtual world. As the ecosystem increases in popularity, so too does its real estate. But to fork over millions of dollars?
Folks, something is very wrong here.
Decentraland Profits from an Immature Generation
If you want my honest-to-goodness reaction to the record-breaking sales we’ve witnessed regarding virtual real estate sales, I felt that this was an exploitation of certain investors’ mental or psychological challenges. Either that or people nowadays have way more money than sense.
I’m trying my best to understand the impetus for such transactions. What Michael Gord, a co-founder of Metaverse Group, told the New York Times seems to make sense within a confined context.
“As more people participate, it’s where you’re going with friends, where you’re having experiences like conferences and concerts. It’s inevitable that the metaverse will be the No. 1 social network in the world.”
If Gord turns out to be right, then investing in Decentraland tokens or virtual land would make sense in a purely capitalistic framework. Look, investing in cryptocurrencies is all about making money, like anything else. So, who the flip cares if the underlying asset is property or virtual property? If the masses come, then so be it.
But that’s an awfully big risk to take because no one knows if a) the metaverse will catch on and b) which metaverse will catch on.
That so many people are aroused with Decentraland and other fantasy worlds made me wonder: is the long-lasting immaturity of young Americans responsible for this irrationality?
Sure, research firms will point to younger people not achieving certain life and professional milestones as prior generations. I don’t think this is due to immaturity as opposed to more wealth being concentrated in fewer hands. Simply put, there are fewer opportunities available.
Is it any wonder that they’d rather buy virtual real estate than real real estate?
MANA Is Surprisingly Uncomfortable
Interestingly, as technology became more prevalent, the New York Times noted that prior moral misgivings about plagiarism faded away. Many students failed to understand that this was a serious academic misdeed.
Even further, Inside Higher Ed pointed out that some contemporary young students don’t view plagiarism as deceitful and worthy of censure. In fact, studies have shown that cheating is on the rise, including among — get this — high achievers.
Now, why would high achievers need to cheat? It’s a perplexing question, just like spending millions of dollars to buy virtual real estate in Decentraland or wherever the heck. What’s going on here?
More than likely, the real answer is complex and nuanced.
Still, I genuinely believe (because the evidence points in that direction) that the delayed or stunted path to adulthood — and the subsequent lack of moral character — is contributing to such risky and arguably reckless behaviors.
This stuntedness, perhaps exacerbated by improper or undisciplined rearing from both fathers and mothers, helps explain moral declines in other areas.
Still, there’s money to be made here. Again, if people want to metaverse their lives, MANA can fly. Just be aware that a possible breakup could be an ugly thing indeed.
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On the date of publication, Josh Enomoto held a LONG position in MANA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.