Every few months, crypto enthusiasts frequently cite a new buzzword. In 2021, non-fungible tokens or NFTs were one of those inventions in cryptocurrencies which took the world by storm. 

For the most part, gaming, digital art, and collectibles were the biggest contributors to the booming NFT industry. Gaming, in particular, has long been about building immersive virtual realities mimicking much of what people experience in real life. 

Hence, the concept of a metaverse is nothing new. It was first spoken about in the 1992 science fiction novel by Neal Stephenson called ‘Snow Crash.’

Yet, over the past few weeks, this idea has become the topic of hot discussion, partly fueled by Facebook Inc.’s decision to change its name to Meta Platforms Inc. to emphasize the brand’s plans of venturing much of its products into the metaverse.

Overall, there’s somewhat of a renewed focus on this concept presently. Google Trends presently shows a surge in the search term ‘metaverse’ since mid-October, with many experts labeling it as ‘the future of the internet.’ 

So, how does this affect NFTs, and which projects are anticipated to grow in value within this realm? Let’s find out.

What is a metaverse? What about NFTs?

It’s beneficial to break down the two components for better understanding since this is often a complex topic. In a nutshell, a metaverse is like a real-life video game experienced via a computer, phone, or virtual reality headset. 

A metaverse is a shared, enveloping virtual world where players (typically using avatars) interact with one another, build in-world objects and real estate, indulge in experiences, and much more.

Just as in the physical world, a metaverse has its own currency and economy. So, how do NFTs work within metaverses? 

A non-fungible token is a unique, one-of-a-kind tokenized version of a digitized asset, ranging from art, music, collectibles to 3D virtual worlds, images, videos, and just about anything deemed of value.

In-game items are some of the most popular NFTs. For instance, on Axie Infinity, players trade NFTs of unique creatures with special body parts, skills, and mechanics. 

Axie is one prominent example of a metaverse as it’s a battling game with its own virtual open world known as Lunacia for players to create ‘axies’ or eccentric battling creatures.

Ultimately, metaverse NFTs are a mishmash of cryptocurrencies, virtual reality, and blockchain technology.

Benefits of metaverse NFTs

Below are the benefits of NFTs in the metaverse.

  • Decentralization: Decentralization is at the core of cryptocurrencies. Non-crypto-based virtual worlds are controlled by companies with their own structures and business models.

However, a genuine crypto metaverse provides much of the power to its users, where ownership is shared among the participants.

Having a distributed model rather than a centralized one means the entire system has no single point of failure and shall continue even if the original creators of that world have gone.

Decentralization also allows for a unique, democratic type of user-based governance. Through mechanisms such as governance tokens, users can vote on changes to the game’s future.

  • Solid provenance: The point of metaverse NFTs has in-game or in-world goods that can be tokenized into non-fungible tokens. At their core, NFTs provide solid ownership of digital assets, which is transparent and immutable. 

Not only can players turn objects into NFTs, but even things like achievements, acquisitions, or anything providing massive value within the metaverse in question.

  • Substantial economic value: Before cryptocurrencies, players could not turn in-game items and currencies into real-life money. Fortunately, this has all changed now as a wide array of unique in-game objects command substantial value in marketplaces.

This activity brings much-needed liquidity to exchanges and other facilities dealing with the trading of cryptocurrencies.

Top 3 metaverse NFTs expected to grow in value

Now that we’ve covered what metaverse NFTs are and the benefits they bring to the table, let’s explore which projects in this realm are anticipated to grow in the future. These rankings are based on CoinMarketCap’s placements for the most traded gaming tokens by market capitalization.

1. Axie Infinity (AXS)

Axie Infinity’s homepage

Created by Sky Mavis, a Vietnamese gaming developer, in 2018, Axie Infinity is an Ethereum-based play-to-earn battling game where players raise, trade, and combat ‘axies,’ unique Pokemon-like creatures which are turned into tradable NFTs.

The open-world is known as Lunacia, where users complete numerous quests, farm different resources, hunt for treasures, and more. Players can customize their axies as they get ‘experience points’ through winning battles by evolving their bodies and increasing their battling prowess.

Axie’s performance over the past year has been impressive, increasing by close to 43 000%. According to CoinMarketCap, it’s the most traded gaming coin and 25th overall. Presently, one AXS costs $152.

2. Decentraland (MANA)

Decentraland’s homepage

Decentraland is yet another entrancing, Ethereum-based metaverse combining 3D virtual reality and NFTs. Officially launched in February 2020, the project is presently the second-largest gaming coin (43th overall), according to CoinMarketCap.

Decentraland allows anyone to build, navigate, and monetize incredible land structures and sceneries like villages, mazes, cities, and outer space. Users can turn these land lots (over 90 000 presently) into tradable non-fungible tokens in open marketplaces using MANA, the platform’s utility currency.

Currently, one MANA token is $2.61. In the early days of Decentraland, land pieces were selling for about $20 a pop. As NFTs exploded, some of these parcels were sold for over $100 000. Hence, it’s one project within this space that’s likely to continue growing in value.

3. The Sandbox (SAND)

The Sandbox’s homepage

The Sandbox was initially released by Pixowl for smartphones and Windows in 2012. It was named after the concept of a ‘sandbox game,’ a type of game with expansive creativity and no real objectives.

Eventually, the game transitioned onto the Ethereum blockchain for better monetization, introducing a play-to-earn model and allowing people to become gamers and creators.

The Sandbox is simply a metaverse for developing distinct, animated 3D animals, humans, foliage, tools, and real estate, along with creating games, hosting contests, etc. 

There is also an NFT marketplace on The Sandbox where users can trade NFTs of their creations. SAND is an ERC20 token and the primary utility currency powering the platform’s interactions and transactions, along with providing governance, staking, and more.

This coin recently reached an all-time high of $3.45 in November 2021 but is now valued at $2.37.

Final word

So, where to from here? For the layman, it may sound all too overwhelming; there’s blockchain, NFTs, and now virtual reality is thrown into the mix. The metaverse doesn’t just represent immersive and life-like virtual worlds, but web 3.0.

There are several ways of defining web 3.0, but we can best summarise it as a decentralized, smarter, open, and more autonomous web. Metaverse NFTs are one of the paths for accessing this emerging technology. 

This should ultimately disrupt how we communicate, handle our finances, engage in recreational activities, create personal profiles, and more.