How To Profit From The Metaverse

November 3, 2021  bitcoin, blockchain, cryptomining, decentraland, Ethereum, Green Technology, how it invest in the metaverse, How to invest for inflation, how to profit from the metaverse, meta, metaverse, sandbox, tech investment

How To Profit From The Metaverse

Facebook created a huge amount of hype last week around the concept of the Metaverse by rebranding Facebook to Meta.

(Full Keynote Video here https://www.facebook.com/watch/?v=561535698440683 )

Contrary to what Facebook (Meta) would have you believe the Metaverse already exists and is expanding rapidly. Decentralised projects, such as Sandbox and Decentraland, are already ahead of the curve. They will not be handicapped by Facebooks negative image or desire to collect your personal data.

How to profit from the Metaverse
How to profit from the Metaverse

 

How Big Can The Metaverse Be?

Bloomberg Intelligence recently estimated that the metaverse’s market size will reach USD 800bn by 2024, suggesting this could be a very lucrative area to invest in.

I write this as a Forty something property and renewable energy professional who has sourced and raise funding for projects in just about every corner of the world. I always thought funding the highest building in Outer Mongolia was the most extreme piece of real estate I would ever work on, is the Metaverse set to eclipse this?


What is the Metaverse?

For those that don’t know, the Metaverse was first coined in a Scifi novel by Neal Stephenson in the 1992 science fiction novel Snow Crash, where humans, as avatars, interact with each other and software agents, in a three-dimensional virtual space that uses the metaphor of the real world. Stephenson used the term to describe a virtual reality-based successor to the Internet.

So why has Facebook, one of the world’s largest corporations, identified this as the next evolutionary step for the internet?

They made their first major bet on this space back in 2014, when they purchased VR headset manufacture Oculus. I am sure most people have tried an Oculus headset at a trade show at some point, but how many people do you know that have gone out and purchased one for their home? Is this all set to change?

 

Smoke & Mirrors Or The Real Deal

Facebook are committing 10,000 people to this project and $10 Billion. That’s an incredible team and massive undertaking. However, is this a stroke of genius or desperation as the numbers of users of both Facebook and Instagram start to fall across the developed world as the below FT article outlines.

https://www.ft.com/content/4304f14a-1b06-46d8-a066-42bb1b3c200c

Internal documents show that the number of US Facebook users under 30 is in decline and that Instagram, which has been phenomenally popular since being bought by Facebook in 2012 for $1bn, appears to be reaching the limits of its growth among younger users in key markets, raising serious questions about the company’s future.

Will Facebook Be The Metaverse?

Personally, I don’t think Facebook will win the race to be THE Metaverse, there is too much bad blood from the mismanagement of Facebook and our data. This is reiterated by the fact they felt the need to rebrand rather than carry the world’s most recognisable social media brand into the metaverse.  Also, most of our interactions in the Metaverse will be private or via Avatars so there will be less opportunity to mine our personal data and sell it to advertisers.

However, rather than provide the ecosystem itself, like they did with Facebook, they could well provide the hardware and support services, such as games, events, business communication tools, fitness tech and wearables. This could see the company stay relevant. And if you throw $10 billion at any problem you are bound to back some winners.

So the first answer to the question how to profit from the Metaverse… Buy shares in Facebook, this might not appeal to everyone given their questionable ethical practices. So we will look elsewhere for better opportunities.

 

Who Will Be The Metaverse Ecosystem?

The real money will be made by identifying where the Metaverse Ecosystem may come from if its not Facebook.

Research has identified two major current players, Sandbox and Decentraland. We shall discuss both their merits below.

 

Sandbox. https://www.sandbox.game/en/about/

With its strong emphasis on decentralisation, a key idea of ​​cryptocurrencies, sandbox allows the use of its native token SAND in the game to implement its five functionalities: buy, trade, play, create and govern.

The Sandbox is a metaverse that offers players and creators a decentralised platform to create 3D worlds and game experiences, as well as to store, trade and monetise their creations. It is a subsidiary of Animoca Brands, which develops and publishes products in digital entertainment, blockchain and gamification.

As I write this Sandbox has just received $93 million form Softbank to continue its development. The Sandbox Crypto coin used within the Metaverse has risen 24% today alone. Sandbox Coin can be purchased on the Binance Exchange.

There are two ways to invest in Sandbox’s growth, one would be to buy SAND coin, the other is to buy land within the Metaverse itself. This, like all land speculation is highly risky but can have enormous upside.  The Land parcels which can be seen here (Map of LANDs and the Game Metaverse (sandbox.game)) will be registered on the Ethereum network as an NFTs (Non Fungible Tokens). This secures your asset in the metaverse to you and you only.

 

Decentraland https://decentraland.org/

Like Sandbox, this platform is not controlled by any central entity or company. It is a decentralised virtual reality world that allows you to monetize the content created through tools such as the simple Builder tool and some SDKs for the more experienced. This Metaverse is already well established, they have recently thrown a number of high profile parties and a list of upcoming events can be seen here. https://events.decentraland.org/

The interesting part for investors is the land section: https://market.decentraland.org/lands

Land parcels as you can see are priced in Ethereum and are already commanding substantial amounts. Personally I think they are trading at too much of a premium for novice investors. The more sensible play would be to accumulate some to their crypto currency MANA.

MANA is the currency of Decentraland. With it, you can buy or rent parcels of virtual land, known as LAND, which work through a smart contract based on the ERC-721 standard that is approved and stored in the blockchain by Ethereum.

 

The Final Play

So how to profit from The Metaverse? For me, all of the above are sensible ways to access the Metaverse and back a runner in this very early race. If one of the above were to become the major player in this space the upside potential in huge. But none of this is guaranteed, we may not have even seen the Metaverses final ecosystem yet. It may yet be superseded by a new player much like Netscape was.

There is however one constant that seems to be running through all of these runners and riders, they are all using NFTs powered by Ethereum.

Willow Rivers has long been a big fan of the Ethereum network, although expensive, it is proven. For me, the simplest and most diversified way to invest in the Metaverse is to buy or mine Ethereum.

 

Ethereum is essentially the building blocks for the Metaverse @brendan_dharma on Twitter recently wrote:

 

So basically, it’s Ethereum vs. Facebook in a race to create a compelling Metaverse.

Open vs. Closed.

Transparent vs. Opaque.

Permissionless vs. Permissioned.

Community Owned vs. Zuck Owned.

My bets are placed. Let’s build a better future together.

 

If you have any questions or would like to discuss any of the above please get in touch via www.willowrivers.com

We are happy to talk you through strategies and ways of accessing crypto and the Metaverse. If you would to be part of our mailing list simply fill out the form below and you will receive updates on new projects and investment news.

How to profit from the Metaverse

How To Profit From Inflation.

May 21, 2021  How to invest for inflation, How to profit from inflation, inflation proof investments, property development, property investment

How To Profit From Inflation.

 

Unless you have been living under a rock for the last few weeks, you will have seen that the markets have been spoked by the prospects of higher inflation. This has come about due to the post Covid bounce we predicted back in January, in our Roaring 20s article. https://willowrivers.com/the-roaring-20s-are-back/ This latest article looks at how to profit from inflation.

Just in case you don’t know what inflation is. I have borrowed a definition from Robbert Kiyosakis website: The simple definition of inflation is when prices rise and the purchasing power of a currency drops. It means that you can buy less with your money than you used to be able to. Simple!

So we are all getting poorer. Our money goes less far and this is bad news unless our income is linked to inflation.

Luckily there are ways of beating this. Some assets perform better than others in an inflationary environment and we are lucky enough to have a number of these on our books here at Willow Rivers Wealth Ltd.

How to profit from inflation
How to profit from inflation

Long-term (since 1950) correlation between inflation & various financial/real assets.

So lets first look at what not to do!

The worse thing you can do, is hold all your net worth in cash in an inflationary environment. You are effectively making a negative return. With some analyst stating inflation could pass 5% this is a very real threat.

The boom on the back of the rapid vaccine rollout is starting to take shape and many assets and commodities are getting swept up in the rapid recovery. None more so than in the construction industry:

https://www.constructionnews.co.uk/supply-chain/construction-materials-shortage-5-key-items-in-short-supply-17-05-2021/

https://www.theconstructionindex.co.uk/news/view/developers-urged-to-start-now-to-beat-build-inflation

Inflation in building materials will lead to higher prices for construction and thus higher property prices down the line. Added to this, demand for property is rising as people come out of look down and look to improve their living standards.

Fuel prices are also rising rapidly as we get back on the roads and start to fly again. Expect $100 oil in the not too distant future. https://financialpost.com/commodities/energy/oil-gas/peak-demand-more-like-a-supply-crisis-propelling-oil-to-us100

So how do we beat and profit from inflation?

How to profit from inflation

  • Property Investment

So the first and most obvious place to look when trying to beat inflation in the property market. Inflation is also a good time to use leverage. One can buy a property with a buy-to-let mortgage and buy an appreciating asset with a 25% deposit but see capital appreciation on the full value of the property. If you fix in your mortgage rate for several years you should be able to see steady capital appreciation and rental growth, while your fixed interest costs remain the same. A very crude example of this would be a if a 100,000 pound flat appreciates by 10% and you have invested 25,000 you have made a paper profit of 40%. (10,000/25,000 x100) comfortably beating inflation. There are obviously other costs to take into account but even when these are added you should still be well clear of any inflation.

  • Property development.

Buy developing houses and projects now, you can build at the current prices and sell at the new rate of inflation in 6 to 12 months time. We offer a number of property developments around the county all with market beating returns of 15%+. We use a JCT contract https://corporate.jctltd.co.uk/products/about-our-contracts/ which fixes the price of the build at the front end and avoids any uncomfortable surprises for the investor. Get in touch to find out about our latest development opportunities around the county. More details at www.willowrivers.com

 

  • Commodities

You can trade commodities on all the usual platforms such as Etoro and IG. Oil Copper and Timber are already showing excessive growth, but just about any commodity used in the building process will see substantial growth over the next couple of years.

 

  • Renewable energy with inflation linked returns.

We have been developing renewable energy projects for over ten years now. Feed-in-tariffs linked to inflation are a thing of the past now, however we are still building private projects with a Power Purchase Agreement (PPA). The power generated from wind, solar or geothermal is sold back to the business below and the contract is fixed for 20 to 30 years with an inflation linked kickder to the price. We are able to generate 10% to 15% pa returns which will rise in line with inflation. Get in touch to find out what projects we have available for investors. Projects start from 20,000 pounds to 25m. www.willowrivers.com

  • Farmland and Forestry

UK Farmland will also appreciate again. The combination of the security land ownership offers, zero inheritance tax and yields linked to commodity prices will attract both UK and international investors alike. We work closely with a number of UK land companies and can help with forestry and agricultural land investment.

Conclusion

Don’t just take our word for it, hedge fund manager Michael Burry made famous in the the movie Big Short is also investing for inflation. https://moguldom.com/338484/famous-big-short-investor-michael-burry-warns-weimar-like-hyperinflation-is-coming-to-america/

Now is the time to get your house in order and profit from what is likely to be a bumpy road ahead.

If you have any questions about building an inflation proof portfolio, do get in touch and we can discuss some strategies.

Additional resources on inflation:

 

Institute of International Monetary Research has produced a good video on their inflation expectations over the next couple of years.

 

Good video here on why we can expect higher inflation of the next couple of years.

https://www.youtube.com/watch?v=0y6zXwZpeFc&list=PLudZPVEs3S82lh5QYlWNegc0hEOzg2hH7&index=2

https://www.theguardian.com/business/2021/may/15/the-fear-that-haunts-markets-is-inflation-coming-back

https://www.marketwatch.com/story/the-biggest-inflation-scare-in-40-years-is-coming-what-stock-market-investors-need-to-know-11617846712

https://www.wsj.com/articles/if-inflation-is-coming-here-is-what-to-do-about-it-11620694235

Subscribe to receive updates!

Click below to listen to the Willow Rivers Podcasts