Threebody Capital: The bubble of the Metaverse

Everyone wants to become a meta-universe company, and big numbers are emerging: meta-universe may even be a trillion-dollar opportunity, and seller research institutions of all shapes and sizes are now moving with the wheels of the narrative.



After Facebook changed its name to Meta, Metaverse has become the main topic of discussion. Metaverse is no longer a fictional and illusory thing, no longer a patent for fans of “Ready Player One” and anonymous Twitter accounts with cartoon avatars, it is real.

More than two years ago, we wrote about how the game can be promoted to a more immersive experience for the first time in “The Next Stage of the Game”. In the year after that, we used the term “metaverse” for the first time and outlined several emerging opportunities that we focused on.

Of course, since we wrote these notes, things have changed dramatically. We once thought that Tencent was one of the main companies that dominate Metaverse. Although it is not obvious at the moment, this may still be true. In this process, for all those who observe carefully, the growth of metadata is indeed in full swing. On the one hand, companies like Roblox , Fortnite, and Minecraft are building their meta-universe ideas within the walls. On the other hand, in the world of cryptocurrency , companies such as Axie Infinity , Decentraland, and Sandbox are planning another path, just to name a few.

With the Winklevoss twins raising $400 million to build a meta-universe outside the walled garden of Facebook (or now Meta), the ideological divergence has been further highlighted this week. The details seem few at the moment, but it will be interesting to see what they are standing by.

As the origins of these digital nations unfold, and opinions are formed around how to manage them and evaluate the assets in them (especially when everything is intangible), users are flooding into these ecosystems, looking for fun and work , Especially in the emerging world.

Therefore, we now find that “meta universe” has entered the field of general terminology from the exotic field. Everyone wants to become a meta-universe company, and big numbers are emerging: meta-universe may even be a trillion-dollar opportunity, and seller research institutions of all shapes and sizes are now moving with the wheels of the narrative.

What we wrote about Axie Infinity last week also applies to the general meta-universe, but this is just the beginning.

Pull the future into the present

Let’s face it: we are facing an expanding potential bubble. Although other markets shudder at the thought of out-of-control inflation, potential interest rate hikes, and the complete collapse of one of the largest uninterrupted bull markets we have ever seen, the selected pockets continue to rise with great enthusiasm. This is their common The point is that they are all “meta universe” games.

Contrary to popular belief, bubbles are not all bad. Although recent irrational exuberance often leads experts (and analysts) to make very aggressive long-term forecasts of growth, which often proves unreasonable in the near term, the trends they forecast may remain for a longer period of time Run steadily.

George Soros’s famous saying about bubbles came to mind: “When I saw a bubble forming, I rushed in to buy it and added fuel to the fire. It’s not unreasonable.”

This is indeed a bubble.

The bubble has promoted the suspension of suspicion, allowing human irrationality to allow capital to advance to the present to fund projects that are unrealistic from the perspective of capital allocation. This phenomenon has also resulted in a low/zero interest rate environment in recent years. s help.

Everyone wants a piece of the pie: some candidates are indeed major players in the field, while others are pretenders, using personal connections to market themselves as meta-universe participants.

As always, caution is the key to survival.

From all angles

It is worth pointing out that for the first time we have seen bubbles forming in two previously unrelated asset classes: stocks and cryptocurrencies.

As we have been arguing for quite a long time, the distinction between these “asset class” labels is not important to us when deciding what is an interesting opportunity. However, what is important to other people is important to us, and labels are important to the wider market-a lot.

In terms of stocks, names like Nvidia and Roblox are grabbing the limelight. In the cryptocurrency space, companies like The Sandbox and Decentraland are dominating the highest-profile rankings. And all of this is happening in the context of the broader technological stock market and the weakness of the cryptocurrency market. How is this dispersion?

At a basic level, this is not surprising: stocks have always shown the theme of dispersion, while in cryptocurrencies, traditionally the flow of funds must go through a “base” such as BTC or ETH , and now traders (or investors) can simply Use their credit card to directly access any tokens they want. Whether it is right or wrong, not all roads lead to BTC or ETH anymore. Dispersion exists. The dynamics of flow have also changed.

Of course, the basic story behind these trends remains the same, as we have seen from Nvidia’s conference speeches and their recent results, they are meta-universe (or “omniverse” in their words, because it is ultimately a Bigger story) The prepared tools are ready to use.

Having the right tools is a good start, but there is still a lot of work to be done.

We believe that creators and designers all over the world are keen to extend their hands to these new toolkits and business models, but construction takes time: experimentation, failure, improvement, and iteration.

We will not avoid the looming bubble-this is a good opportunity to make big money. But the harsh reality is that the bubble will burst, so we have to enjoy it while it lasts.

And many years later, once all the original irrational promises become reality, even this bubble may look like a drop of water in the ocean.

Posted by:CoinYuppie,Reprinted with attribution to:
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