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Sector Report

Q4 2021: rise of the metaverse

  • Multi Asset
  • Consumer
  • North America

As our physical and digital lives converge, the metaverse is piquing the interest of consumers and slowly becoming part of the business lexicon. It’s no coincidence that Collins named non-fungible token (NFT) as its Word of the Year for 2021, with the acronym seen in numerous headlines regarding the sale of digital assets - often for eye-watering amounts.

While there are many interpretations of what the metaverse is, will be or could be, most agree it is made up of the immersive virtual and augmented worlds in which one can already do  things such as shop, socialise and work. To explore these worlds there is often the option of doing so as a digital version of one’s self. 

We’re already seeing the transformation of sectors such as gaming and fashion, with many proponents arguing that, eventually, every industry will be involved. While there is a long way to go before even a fraction of the metaverse’s potential is reached, many experts say now is the time to take notice. 

The recent rebranding of Facebook to Meta was a turning point in the mainstreaming of the metaverse. Given its vast reach, Meta is likely to play a significant role in what the actual metaverse eventually comes to mean. According to a former VP at MGA Entertainment Inc, Meta is the platform to watch. “They have the deepest pockets. Everyone is on their platform already, so the potential for their adoption and pivot point is massive.”

Other platforms in the recent limelight include video game publishers Epic Games and Roblox. The former’s Fortnite game has evolved into an online space where people socialise and virtual concerts have been held. “They also have deep pockets and are still a privatised company, so I can only imagine how big they’re going to get with more seeding and more funding rounds,” our expert said. Meanwhile, Roblox no longer positions itself as a pure-play gaming platform, instead positioning itself as a global platform through which people can gather to “imagine, create, and share experiences”. 

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