The metaverse is an emerging virtual world that allows people to socialize, conduct business and more in an interactive digital environment. Right now, the potential for this technology has major corporations vying with each other, trying not to get left behind as it becomes popularized by investors. In a world where people can’t get enough of cryptocurrencies, it seems like Decentraland (CCC:MANA-USD) is the perfect name to invest your hard-earned cash. The MANA token has seen spectacular gains this year, leaping into prominence among an increasing number of cryptocurrencies and platforms alike.
The metaverse is expanding at an unprecedented rate; new virtual platforms are created every day. Now, investment firms are flocking to this phenomenon. If you think the metaverse trend has passed its peak, think again. The concept is still new and the institutional interest is igniting. There are still plenty of opportunities out in the market.
Decentraland’s platform is one of the oldest and most well-known metaverse platforms out there. The potential for MANA is that it generates interest in blockchain-based metaverses. But it could also be a foundation leading to bigger things. This name’s first-mover advantage will help maintain its momentum throughout 2022. As such, risk-tolerant investors may want to dedicate a small portion of their portfolio to MANA. Here’s why.
Decentraland: Metaverse Is the Future of Marketing
The metaverse is a place with tons of freedom. So, with plenty of brands already in the virtual world, it’s only natural that more will join the metaverse soon. Right now, the concept itself is nascent. However, every investor knows that their most important job is to stay ahead of emerging trends.
Decentraland was founded in 2015 by Ari Meilich and Esteban Ordano. It is an open-source 3D virtual world platform that anyone can use for personal or commercial purposes. In 2017, the price of digital land on this platform was about $20 and its cryptocurrency traded for around 2 cents. The platform was opened to the public in February 2020 with supervision from Decentraland Foundation.
One major needle-mover for the price of MANA, however, has been fairly recent. The catalyst? Facebook decided to rebrand itself as Meta Platforms (NASDAQ:FB). With that announcement, many wanted to purchase “land” with Decentraland to get exposure to the metaverse trend and potentially make money before it was too late. But the metaverse is more than a fad. After all, companies like Microsoft (NASDAQ:MSFT) and Meta Platforms obviously see value in this space.
Much of that has to do with a secular trend: everything is going digital. As we have seen during the pandemic, companies and individuals have had to adapt to digitalization moving forward. Going digital is inevitable — and also helps facilitate flexibility. When it comes to the metaverse, then, major companies and advertisers are now wanting their piece of the pie as well. In the past, Decentraland has collaborated with Samsung Electronics and the Australian Open. That’s just the beginning.
The Metaverse May Be the Foundation of the New Economy
Virtual reality (VR) is still in its infancy, true. But it’s also growing like wildfire, expanding day by day. And it can even change how people work. Specifically, the metaverse has so far revolutionized how 3D design teams can work together by connecting them digitally. Rather than meeting in person or exchanging files across distances, designers can collaboratively create content from anywhere at any time via the metaverse.
With that, it’s no surprise that the metaverse has been on many minds recently. Nvidia (NASDAQ:NVDA), in particular, is all-in on this concept. Founder and CEO Jensen Huang has an expansive vision for the technology — and hopes it will soon become integrated into our daily lives. Huang had the following to say:
“[T]he economy of the virtual world will be much, much bigger than the economy of the physical world. You’re going to have more cars built and designed in virtual worlds, you’ll have more buildings, more roads, more houses — more hats, more bags, more jackets.”
In my opinion, Meta Platforms has too many privacy issues and is not well-regarded in new markets. However, the idea of a world where people have complete input in how their society operates is part of what makes Decentraland so attractive. The fact that its governance decisions are made by those who own the coin creates an alignment between investor and generator; they both benefit from decentralized control. The metaverse is only going to get more popular. Companies know that. They’re investing in this space because they anticipate interest will continue to grow over time.
Decentraland and MANA Will Only Grow From Here
The MANA token has attracted attention and seen its valuation explode over the last year, thanks largely to speculation. Make no mistake, there is a lot of speculation in the market. People are hoping to make a quick buck and you can’t blame them. However, the metaverse should still only grow from here in the long run. The future of Decentraland is bright and inviting, with MANA standing out as a crypto that will be valuable for years to come.
The market has shown its power before when it comes to crypto. Incredible bull runs have rocketed coins higher and individual tokens have posted huge gains on little news. However, the metaverse will likely need to continue rapidly adding users while recording strong growth rates throughout this process. But that is possible given the current trajectory.
Take Roblox (NYSE:RBLX) for example. Roblox is a multiplayer social game where players can create and play in virtual worlds. The platform has grown steadily and currently has more than 47.3 million active users. Now take Decentraland, which has the potential to become more immersive than any other game out there. True, it has nowhere near the number of users as Roblox at this stage. However, moving forward, if it continues to gather steam, Decentraland can easily replicate the success of Roblox — and its rise will have much wider implications.
Decentraland Is Interesting to the Risk-Tolerant Investor
When I think about the metaverse, one word comes to mind: potential. There are so many opportunities in this new frontier that companies and developers alike are exploring. What’s more, crypto tokens offer investors a unique opportunity; they allow you to buy into early-stage technology and projects.
True, pricing is volatile and can fluctuate dramatically based on a platform’s progress (or lack thereof). That makes this asset class risky. But it also makes it potentially lucrative.
What if you could invest in the future of money? Recently, investments in crypto and non-fungible tokens (NFTs) have many people asking that same question. The MANA token, with its potential across many aspects of this space, might be worth considering as a way to diversify your portfolio across the board without taking on too much risk or sacrificing possible returns.
It’s easy to see why many people are excited about Decentraland. And it seems like MANA might be just the thing if you are looking for a high-risk, high-reward investment.
On the publication date, Faizan Farooque did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience in analyzing the stock market and was a former data journalist at S&P Global Market Intelligence. His passion is to help the average investor make more informed decisions regarding their portfolio.
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