Metaverse crypto tokens have risen as a new sub-asset class within the crypto markets, capturing the interest of investors aiming to capitalize on the potential evolution of the internet. Early-stage metaverse platforms like Decentraland and Sandbox are driven by cryptocurrencies that function as in-world currencies. This presents investors with an opportunity to gain exposure to a burgeoning industry.
Investing in cryptocurrencies, Decentralized Finance (DeFi), and Initial Coin Offerings (ICOs) is inherently risky and speculative, with markets that can be highly volatile. It is advised to consult with a qualified professional before making any financial decisions. This article is not an endorsement by Investopedia or the author to invest in cryptocurrencies, and the accuracy or timeliness of the information cannot be guaranteed.
Metaverse crypto refers to a subset of cryptocurrencies that facilitate the buying and selling of digital assets within blockchain-powered virtual worlds, such as virtual land, real estate, or avatar items. These crypto assets are high-risk investments, necessitating thorough research before adding them to your portfolio.
Leading metaverse tokens like Decentraland’s MANA, Sandbox’s SAND, and Axie Infinity’s AXS saw significant price increases during the 2021 crypto bull market, but their values plummeted in 2022, illustrating the volatility of this sub-asset class.
The metaverse has also drawn the attention of major global brands seeking new ways to enhance their branding, reach new audiences, and boost customer loyalty. Brands like Nike and Gucci have ventured into this space, exploring how NFTs can enhance customer experiences. Nike acquired NFT fashion startup RTFKT to sell virtual Nike shoes, while Gucci launched its Gucci Vault Land in the Sandbox metaverse.
Purchasing metaverse coins is similar to buying Bitcoin, Ethereum, or any other digital currency on a crypto exchange. Cryptocurrency exchanges function as online trading platforms that allow you to buy and sell digital currencies for U.S. dollars or other cryptocurrencies.
Step 1: Sign up for a crypto exchange. Choose a reputable platform like Coinbase, Kraken, or Uphold to buy metaverse tokens by depositing U. S. dollars using your preferred payment method. Register an account and complete the customer onboarding process.
Step 2: Confirm your payment details. Select the payment method you wish to use to fund your trading account, with wire transfers typically being accepted by all U.S.-based crypto exchanges.
Step 3: Select the metaverse token you want to buy, view the current market price, and press “buy. ”
Once you have funded your account, you can choose the metaverse token(s) you want to purchase. Place an order for the desired amount and wait for it to be filled. A market order will complete your purchase within seconds, and the tokens will appear in your trading account’s wallet. Alternative Ways to Buy Metaverse Crypto. You could also purchase metaverse coins on peer-to-peer trading platforms. Unlike centralized crypto exchanges where orders go into an order book for a specific cryptocurrency pair, on a peer-to-peer marketplace, you can buy cryptocurrencies directly from another individual using a predetermined payment method and an agreed price. Moreover, you can swap cryptocurrencies you already hold for metaverse tokens on decentralized exchanges (DEXs). Decentralized exchanges only require you to connect your crypto wallet to the trading platform’s smart contract. You can swap one token for another without creating a trading account or completing a customer verification process. Unlike traditional brokerage firms, cryptocurrency exchanges are not members of the Securities Investor Protection Corp. (SIPC). So, unless user terms specify otherwise, investors with cryptocurrency assets commingled on a custodial cryptocurrency exchange could potentially lose their funds as unsecured creditors. What You Need to Open a Cryptocurrency Exchange Account. To open an account on a cryptocurrency exchange, there are certain requirements. Personal Information. The personal information and documentation required to complete a crypto exchange’s onboarding process typically includes full name, email address, phone number, home address, proof of address, and government-issued ID. Minimum Deposits. Every exchange requires customers to make a minimum deposit to start trading. The minimum deposit varies from exchange to exchange but is typically between $10 to $20. Some crypto trading apps, like Robinhood, allow you to start with as little as $1. Types of Cryptocurrency Exchanges. Centralized Exchanges. Centralized crypto exchanges are online trading platforms similar to traditional online brokerages. Traders and investors can buy and sell cryptocurrencies after completing a customer onboarding process and depositing U.S. dollars to fund their trading accounts. Decentralized Exchanges. Decentralized crypto exchanges are trading platforms where smart contracts replace a centralized orderbook. Crypto traders and investors can swap tokens for one another by simply connecting their crypto wallets. No identity verification is required. The most compelling argument for trading on decentralized exchanges is that situations like the FTX collapse cannot affect user funds as assets are held in users’ wallets, separate from a centralized exchange wallet. So, if a decentralized exchange gets hacked or the company operating it goes bankrupt, user funds remain unaffected.
Hybrid crypto exchanges combine a centralized orderbook for trade matching and decentralized token storage. This enables crypto traders to experience the benefits of both centralized and decentralized exchanges. Best Cryptocurrency Exchanges: Company – Transaction Fees – Minimum Deposit or Purchase – Trade Limits. Coinbase: 0.00% to 0.60% – $1 – No. Kraken: 0.00% to 0.26% – $1 – No. Uphold: 0.8% to 1.2% – $10 – Yes. What Are the Top Metaverse Coins Right Now? Decentraland (MANA) is the leading virtual world’s in-platform currency. It enables users to transact in the early-stage metaverse. For buying virtual land or wearable items, MANA is required. The Sandbox (SAND) has attracted big artists, influencers, and brands. It offers a versatile virtual world powered by the SAND token. Like MANA, SAND is the in-world currency for transactions. Axie Infinity (AXS) is a popular metaverse-esque blockchain game. Players battle their in-game avatars called Axies. Winners earn tokens. AXS is the game’s governance token and used as a transactional currency in the NFT marketplace. Factors to Consider When Opening a Cryptocurrency Exchange Account: Security is crucial. Choose an exchange with a strong cybersecurity track record and no hacks. Fees can impact returns. Select an exchange with low trading and withdrawal fees. Check the number and quality of supported cryptocurrencies. If buying metaverse tokens, ensure the exchange supports them. Wallet safety is important. Choose an exchange with secure crypto wallets and features like withdrawal wallet whitelisting. Storage and custody should be considered. Ensure the exchange holds customer assets in cold storage. Centralized vs. decentralized exchanges have pros and cons. Decentralized ones may be more secure, but centralized exchanges are often regulated for more customer protection. FAQs: How Can I Earn Crypto in the Metaverse? Land Sales: Buying and selling virtual land is an alluring earning opportunity in the metaverse.
Some parcels of Land—virtual land sold in the form of NFTs in Decentraland—have been sold for hundreds of thousands of dollars. Digital Asset Creation: By creating and selling new digital assets—typically in the form of NFTs—metaverse users can earn crypto. Selling Accessories: Avatars can be customized with various items, such as clothes and shoes. These can be bought and sold as NFTs, enabling metaverse users to make money in the metaverse. Providing Services: Like in the “real” world, metaverse users can offer services to earn crypto, such as promoting brands by offering virtual advertising space or acting as a virtual tour guide through the metaverse. Hosting Events: Hosting virtual events, such as concerts and art shows, has emerged as a popular way to earn revenue in the metaverse. It’s important to remember that, like all crypto assets, metaverse crypto assets are high-risk investments. Therefore, conducting thorough research is essential before making the decision to add metaverse tokens to your crypto portfolio.