The CEO of Meta Platforms, who is worth a million dollars, still believes in the cryptocurrency business. But really, does he have a choice?
Mark Zuckerberg, CEO of the social media company Meta Platforms (META), is a big fan of the metaverse, an immersive virtual environment where people would talk to each other through digital avatars.
Non-fungible tokens (NFTs) will probably be a big part of Meta’s next big thing, this virtual environment. NFTs are a way to find out who owns a piece of content on the internet, like a photo or audio recording. Fear of Missing Out, or “FOMO,” made NFTs the most talked-about thing at the start of the year, but now they don’t seem as interesting.
The NFT market is very cold. DappRadar says that in less than four months, the number of trades on OpenSea, the Amazon of NFTs, has dropped by 99.9%. On May 1, the platform went through a record $2.7 billion in NFT transactions. On August 28, only $9.34 million was made on the market. Prices have also gone down a lot.
At the moment, big brands like Chanel and Gucci use NFTs, which are also a good way to keep customers and build specialized loyalty programs. In fact, NFTs let the luxury industry create the feeling of being part of a small group, which fits with the idea of luxury.
Hermes has officially filed a trademark application with the USPTO to protect downloadable software “for use in online worlds” to view, store, and manage virtual items, digital collectibles, cryptocurrencies, and non-fungible tokens.
It makes sense that the French luxury company would want buyers of its wildly popular Birkin bag to feel like they are part of a prestigious and exclusive club by letting them make an NFT of this bag or its famous silk pluggers.
Zuckerberg Reclaims NFTs
Zuckerberg wants to bring back NFTs and get people to accept them as an important part of the metaverse he is trying to sell us. This is to give the same impression of exclusivity. Meta just recently said that, like Instagram, Facebook would also accept NFTs.
Users will be able to post their verified photos on their own accounts. As on Instagram, the photos will look like any other publication, but there will be a small “Digital collectible” logo in the bottom left corner, just like on Instagram. Also, you have to link your virtual wallet to one of the two social networks to use it on the other.
Meta, which had 3.65 billion users as of June 30, wants to make money by getting people interested in NFTs again. It’s not clear if the company and its wealthy CEO will do well. First, they have to show that the value of these digital artifacts is not just based on guesswork.
The biggest problem with Zuckerberg and his metaverse are that it sometimes seems like he has no choice but to stick with a bet that is not paying off. In the second quarter, Reality Labs, which is where Meta’s metaverse projects are housed, had an operating loss of $2.81 billion. The total amount of money lost in the year’s first half was $5.8 billion. In 2021, Reality Labs lost a total of $10,2 billion.
The big test is coming up soon
Some things related to the metaverse, like virtual reality headsets, have already done well. In 2021, 8.7 million Meta Quest headsets were sold, which shows that virtual reality (VR) was popular with people outside of the gaming community, where it was first made.
Meta’s new virtual reality headset, which will come out in October and replace Quest 2, will replace Quest 2. It was shown off in October 2021 and was given the name “Project Cambria.” It claims to be able to show users’ emotions on their faces in virtual reality for a more realistic metaverse experience. It was made so that professionals can use it.
People think that this headset will be called the Meta Quest Pro when it comes out. It would work in real-time with people’s avatars if it could track their eyes and faces. The new headgear might be able to turn the real world around you into a virtual one. If these features work, it could be the start of the online social interactions that Zuckerberg has been talking about for months. This kind of originality would definitely get people’s attention.
During Meta’s earnings call for the second quarter in July, Zuckerberg told investors, “I think people are going to be pretty blown away by this,”
How much will this headset cost, even if he keeps his promise to be innovative? Word on the street is that the amount is $1,500. If this price is true, most people would likely avoid the headset at first, since inflation is already affecting almost every product people use every day. There is the first real test of whether he wants to keep NFTs and his metaverse bet.