Q1 2023 surges with $502 million investments in blockchain gaming and metaverse
The first quarter of 2023 has seen unprecedented growth and innovation in the world of virtual reality. From decentralized fashion shows to high-end luxury brands jumping on the NFT bandwagon, the metaverse is no longer just a concept for sci-fi movies. Join us as we take a closer look at the promising future of virtual worlds and the metaverse.
Key Takeaways
- Virtual land trading reached an all-time high in Q1 2023 with 147,000 trades; Otherside and MG Land accounted for 75% of Q1 land sales.
- Virtual world NFT trading volume spikes to $311 million in Q1 2023, a 277.12% increase from Q4 2022.
- In Q3 2023, the four 10ktf NFT fashion collections emerged as clear winners in the NFT fashion industry, capturing a staggering 74% of the trading volume and establishing their dominance in the market.
- $502 million were invested into blockchain gaming and metaverse projects in Q1 2023.
Table of Contents
- Virtual Worlds achieve record-breaking performance in Q1 of 2023
- Decentraland’s MVFW 2023: showcasing the next frontier of digital fashion
- Fashion meets the metaverse: how luxury brands are taking on NFTs
- Yuga Labs announces second trip for Otherdeed NFT holders in the Otherside Metaverse
- Beyond Apple, Facebook, and Google: exploring the future of online identity
- Q1 2023 investments in blockchain gaming and metaverse projects reach $502 million
- The potential of the metaverse in the automotive industry
- Conclusion
1. Virtual Worlds achieve record-breaking performance in Q1 of 2023
The virtual world market has been on a bull run since the start of the year. The first quarter of 2023 saw an increase in digital land trading volume by 277.12%, with a total of $311 million. This marks the best quarter for virtual worlds since the Terra Luna crash in May 2022. What is more, the number of land trades hit an all-time high of 146,690, a remarkable increase of 83.56% from the previous quarter.
Otherdeed for Otherside leads the pack as the virtual world dapp with the highest trading volume in Q1. The platform registered a whopping $222 million in trading volume, which translates into a 237.34% change from the previous quarter. Additionally, the sales count for Otherdeed for Otherside stood at 65,399, up 138.80% from the last quarter of 2022, making it the highest number ever registered. The hype surrounding this dapp will be explained in the fourth section on this report.
Secondly, MG Land emerged as a top performer, making almost $60 million in trading volume and 45,219 in sales count. MG Land launched at the beginning of this year. On each MG parcel, users can build a decentralized space with an independent domain name, and the platform supports every social interaction, allowing NFT users to freely meet new friends, socialize, play games, and engage in a variety of activities. It is worth mentioning that the high level of trading volume is mainly because NFT whales use this NFT collection to collect BLUR tokens for the upcoming airdrop on the Blur NFT marketplace.
Surprisingly, Createra Genesis Land landed in the third position, having made a trading volume of almost $14 million and 6,308 sales. Createra is a user-generated content (UGC) metaverse engine that enables creators to create, distribute, and MetaFi games. The creator-oriented metaverse project announced $10 million in Series A funding led by Andreessen Horowitz (a16z) back in January. This will allow them to continue their pursuit of building the largest Gen Z-focused metaverse platform.
The Sandbox made it to the fourth position with $3.5 million in trading volume this quarter and 7,338 sales count, which is a decrease of 36.83% and 72.60%, respectively. In February, they had a land sale, and despite the low quarter, they had multiple partnerships with Charles & Keith, Havas Play, GCEX, and Saudi Arabia. Additionally, they just announced their expansion to Germany with the acquisition of game development studio Sviper, and Japan’s leading animation company TOEI ANIMATION is entering The Sandbox metaverse.
Axie Infinity, a virtual world that has been making waves, comes in at fifth place. Thanks to the launch of Homeland, Axie lands generated $2.5 million in trading volume, although it represents a 14.66% decrease from the previous quarter. It is also worth mentioning that Axie Infinity land was among the top 10 sales, with a sale of $150,452 (105 ETH).
Following Axie Infinity, we have NFT Worlds, which recovered after the Minecraft ban on NFTs and had a total trading volume of $2.5 million, an increase of 273.03% from the previous quarter. NFT Worlds released the very first steps of their game reboot with the Armory, a combination wardrobe, shop, and gameplay preview. It’s been a long eight months since NFT Worlds was forced to shut down, so it’s nice to see some life from this Minecraft-themed collection of virtual worlds.
Lastly, WorldWideWebb did $1.7 million in trading volume, an increase of 201.72% from the previous quarter. In late February, Worldwide Webb received a $10 million investment from Pantera Capital, which the metaverse game developer said it will use to integrate more NFT collections and hire more staff.
In conclusion, virtual worlds had a bullish start of the year in the first quarter, with an increase in trading volume and sales count for the top virtual dapps. With more funding and partnerships, we can expect more growth and innovation in the virtual world space.
2. Decentraland’s MVFW 2023: showcasing the next frontier of digital fashion
Decentraland, one of the largest user-owned virtual worlds, is set to host the Metaverse Fashion Week (MVFW) 2023 from March 28-31. This event is a partnership between Decentraland, UNXD, Spatial.io, and other metaverse networks, and it aims to showcase the next frontier of digital fashion.
With the theme of ‘Future Heritage’, MVFW 2023 aims to bring together traditional and innovative fashion by connecting next-generation designers with long-reigning luxury fashion houses.
This year’s roster of brands and collaborators participating in MVFW is both impressive and vast. The event will feature top fashion houses such as Dolce & Gabbana, Tommy Hilfiger, Coach, Adidas, DKNY, Diesel, and Clarks, alongside renowned digital fashion houses and platforms such as DRESSX, Phygicode, The Fabricant, Altr, The Institute of Digital Fashion, House of Web3, and Meta Fashion House.
Over the last 7 days, there has been a significant surge in the Unique Active Wallets for Decentraland, registering an increase of 15.65%, and reaching a total of 1,490 wallets.
Additionally, the trading volume has spiked up by a whopping 63%, reaching $26,880. It is worth mentioning that these figures are only from the past week. Overall, Decentraland had an impressive NFT trading volume of $1.9 million, with 508 sales count this quarter.
Decentraland’s Luxury District will be the hub for showcasing statement-making wares by these various brands. Dolce&Gabbana will lead the charge towards the next wave with its winning designs from the Future Rewards competition, while Tommy Hilfiger’s offerings will include top designs from a community competition picked by Tommy Hilfiger himself, as well as AI-generated products.
Diesel and HAPE will host an immersive virtual party featuring an array of NFT Wearables at the D-Cave community space, adding a measure of whimsy and spontaneity to the proceedings. Other tech-focused players such as Threedium, Pinko, PwC, and Clarks will feature in the virtual mall, while Cash Labs will host multimedia exhibitions, including experiences by Vogue Singapore.
MVFW 2023 also celebrates next-generation talent by showcasing some of the most scene-stealing houses and platforms in digital fashion, including DRESSX, Phygicode, The Fabricant, Altr, and others.
The event will feature Miguel, the Grammy-winning troubadour, who will debut an exclusive digital wearable collection in collaboration with designer Franc Fernandez, along with a gamified fan quest in the new EMPIRE space by T3MP0 & VoxBox. BFF World by MYBFF, an open-access community dedicated to helping women and non-binary people empower themselves in the world of Web3, will be featured, along with an exclusive collection of Ready Player Me wearables with collaborating designers.
MVFW 2023 aims to herald the intersection of new technologies and fashion, affirming and celebrating the endless possibilities in the metaverse. To sum it up, this event promises a glimpse into the future of fashion that you won’t want to miss.
3. Fashion meets the metaverse: how luxury brands are taking on NFTs
The NFT industry has seen a tremendous growth in the past year, and the fashion industry has been quick to catch up. Luxury brands have started entering the NFT market to offer their customers unique digital fashion experiences. DappRadar has been tracking 39 NFT fashion collections, which made an all-time volume of $366.4 million and 293,399 sales count.
One of the most successful NFT fashion collections is Adidas Originals into the Metaverse. This collection has the highest all-time trading volume of $144 million and 47,399 sales. It is a collection of 30,000 digital collectibles on the Ethereum blockchain, granting holders access to exclusive physical merchandise along with “ongoing” digital utility. The Adidas Originals NFT collection has been at the forefront of the digital fashion revolution since making a splash in Web3 during 2021.
However, the landscape of the top NFT fashion collections has changed in Q1 2023. The market is now dominated by the 10KTF collections, which represents 74% of the entire trading volume of the NFT fashion collections.
10KTF, launched on September 17, 2021, is an online shop in New Tokyo (virtual city) run by Wagmi-san, a fictional world-famous craftsman who loves to give you airdrops. Yuga Labs, the parent company behind Bored Ape Yacht Club, has acquired Web3 ecosystem WENEW and its flagship NFT collection 10KTF, adding to its growing portfolio of popular non-fungible (NFT) projects.
Another fashion NFT brand that has taken a good amount of the NFT fashion industry is RTKFT, which has three collections in the top 10 and made $966,479 in trading volume. Founded in January 2020, RTFKT Studios started out creating virtual footwear and clothing. In December 2021, NIKE, Inc. acquired RTFKT for $1 billion. RTFKT’s ‘Clone X’ venture succeeded in capturing the collective imagination of the metaverse. By identifying the untapped potential offered by the metaverse, and anticipating how associated demand is likely to develop, they are playing a major role in bringing collectibles into the next generation.
In conclusion, the NFT fashion industry is growing rapidly, and luxury brands are jumping on the bandwagon to offer unique digital fashion experiences to their customers. While Adidas Originals into the Metaverse was a successful collection, the current market is dominated by 10KTF and RTKFT. The NFT industry is still in its early stages, and we can expect to see more luxury brands entering the market in the future.
4. Yuga Labs announces second trip for Otherdeed NFT holders in the Otherside Metaverse
Yuga Labs, the parent company of Bored Ape Yacht Club, has recently announced exciting news for holders of Otherdeed NFTs, which are linked to land in the Otherside metaverse. The “second trip” is set to take place on March 25th and promises to be an unforgettable experience for all voyagers.
This live event will be a two-hour narrative experience led by four Otherside team captains, providing an opportunity for NFT holders to immerse themselves in the Otherside metaverse. Each holder of an Otherdeed NFT can invite one guest to join them in the adventure. The company has stated that up to 10,000 voyagers will be able to participate on a first-come-first-serve basis. Additionally, non-holders can watch a live stream of the event on Yuga Labs’ YouTube channel.
The first test of the Otherside metaverse platform took place in July 2022 and saw over 4,600 players participate. However, the event caused congestion on the Ethereum network. Voyagers who attended the first trip and participate in the second trip will be eligible to earn a unique Obelisk Piece linked to the overall Otherside narrative.
Otherdeed’s performance in February was impressive, generating $137 million in trading volume, representing a 263% increase from the previous month, and accounting for 95.95% of the whole virtual trading volume in February. This surge in trading volume was largely due to the hype surrounding Yuga Labs’ launch of Sewer Pass and a behind-the-scenes look at the design process for Otherdeed environments.
As of 21 March, Otherdeed has seen a trading volume of $46.8 million, representing 94.73% from the total trading volume of the virtual worlds in March. In addition, the project registered 12,364 sold NFTs. In Q1, the overall performance of Otherdeed was exceptional, reaching $222 million, an increase of 237% from Q4 2022, and an increase of 138.80% in sales count, reaching 65,399. These are the highest land sales ever registered for Otherdeed.
In conclusion, the upcoming Otherside metaverse experience promises to be an unforgettable adventure for Otherdeed holders and their guests. The surge in trading volume for Otherdeed is a testament to the growing interest in NFTs and the metaverse. We can’t wait to see what Yuga Labs and the Otherside team have in store for us in the future.
5. Beyond Apple, Facebook, and Google: exploring the future of online identity
The world of online identity is rapidly evolving, and domain names are at the forefront of this change. In Q1 2023 the performance of domain names was noteworthy, with several key players emerging.
Ethereum Name Service (ENS) is leading the pack, and has been gaining traction since its inception in 2017. With over 2.7 million active ENS names held by 669,000 participants, ENS leads the transformation of digital identities. Its mission is to map Ethereum wallet addresses to human-readable names, making it easier for users to remember and share their wallet addresses securely.
In the first quarter of this year, ENS saw a decrease in trading volume and sales count, The domain name project had $14.7 million in trading volume and 227,677 traded NFTs, down significantly from the $21.8 million in trading volume and 448,165 sales count from Q4 2022. However, it still remains a significant player in the industry, with funding from the ENS DAO, a decentralized autonomous organization that governs the ENS protocol and controls approximately $66 million in assets.
Another player in the online identity space is Unstoppable Domains, which allows users to register decentralized domain names on the blockchain. In March 2023, Unstoppable Domains teamed up with Polygon Labs to launch .polygon, a new domain ending that makes it easier for users to log into Web3 applications, send crypto and NFTs, and create decentralized websites.
Despite a decrease in trading volume and sales count in Q1 of 2023, Unstoppable Domains remains a significant player, with at least 1,100 projects that have installed Sign-in With Ethereum libraries, and these SIWE libraries recently crossed 1 million downloads.
Lens Protocol is another identity provider making waves in the industry. In Q1 2023, Lens saw the highest trading volume, with $1.4 million, and an increase of 92.04% from Q4 2022. Lens allows users to register a unique .lens identifier and also offers the added bonus of being able to “follow” other people who own .lens addresses. Each time a user follows someone on Lens, that connection is saved as an NFT, allowing users to not only own their identity but also own their social network.
SpaceID is also a key player in the space, building a universal name service network with a one-stop identity platform. In Q1 2023, SpaceID had the highest increase in trading volume, with $948,864 million, a 17% increase from Q4 2022. With a multi-chain name service for everyone to easily build and create a Web3 identity, SpaceID is poised for further growth, having recently joined forces with .arb Name Service, while also launching their ID token on Binance Launchpad.
While there is competition among these identity providers, they also benefit from being cross-compatible with each other. In fact, according to Lens, “Lens Protocol + ENS = frens.” The ultimate goal for all these identity providers is to disrupt the status quo owned by Apple, Facebook, and Google and offer users a more secure, private, and trusted online identity solutions. With the performance of domain names in the first three months of the year, this goal may be within reach.
6. Q1 2023 investments in blockchain gaming and metaverse projects reach $502 million
Over the past few years, blockchain gaming and metaverse projects have been attracting massive investments. In 2021 alone, a staggering $3.7 billion was invested in the sector. The following year, the industry continued its upward trajectory, with a total of $7.6 billion invested in 2022. As we move into Q1 of 2023, the industry has started on a positive note, with a total investment of $502 million being pumped into blockchain gaming and metaverse projects.
Upon reviewing the investments made in the first quarter of 2023, it becomes apparent that blockchain games and metaverse projects have secured the highest amount of funding, accounting for a significant 32.7% of the total investments. Infrastructure projects follow closely behind, receiving 31.5% of the raised capital, while investment firms secured 24% of the investments. Meanwhile, Metaverse Tech companies, which focus solely on the metaverse, managed to secure 5.3% of the total funding.
The rise of digital fashion and avatars has been a major focus of investment in the sector this quarter. DressX has raised $15 million to disrupt the fashion industry with digital technology. The company aims to scale its vision of the future of fashion and improve the performance of its app and NFT marketplace. This investment comes at a time when digital fashion is becoming increasingly popular, with 60% of Gen Z and 62% of Millennials believing that the way they present themselves online is more important than in person.
According to a Barclay Card study, nearly 10% of all U.K. shoppers are buying clothes for the sole purpose of posting styled pictures on social media before returning them. This trend plays into digital fashion’s hand, experts believe. With the gaming industry being a great indication of the potential for brands and designers, the digital fashion market is predicted to reach $50 billion by 2030 according to Morgan Stanley.
Apart from the investments in various sectors, including digital fashion, another point of interest in the blockchain gaming and metaverse industry this quarter has been the development of a payment system for digital economies in games and the metaverse. This is where Tilia’s recent investment of $22 million comes in handy, as it aims to provide trusted, dynamic payments in online games, creator platforms, social commerce, and other digital social worlds.
As the digital economy continues to grow, the need for a payment system that caters to the unique demands of expanding digital economies is becoming increasingly important. The current payments infrastructure was built for traditional commerce and hasn’t kept up with the changing needs of a digital, creator-driven economy. Tilia’s focus will be on developing a payment system that unlocks new revenue streams for online creators and the platforms they build in, whether they are gaming worlds, social platforms, or next-generation marketplaces.
The investments made in blockchain gaming and metaverse projects in Q1 2023 show the continued growth and potential of the industry. With investments in various sectors, including digital fashion and payments, the industry is set to continue expanding and changing the way we interact with digital worlds.
7. The potential of the metaverse in the automotive industry
The automotive industry is taking the virtual world by storm, with companies like Holoride, Fiat, and Kia exploring the potential of the metaverse and VR to revolutionize the way we experience cars. While the idea of VR in the car has been around for a while, the technology has been plagued by issues like motion sickness that have made it difficult to implement. However, Holoride has found a solution to this problem, using AI to analyze the car’s motion and the wearer’s head movements to create a seamless experience.
In addition to this, Holoride has added a metaverse element to its platform. The company’s platform is powered by a token, RIDE, which is based on the MultiversX blockchain. This token incentivizes developers by acting as an in-game loyalty token with real value, and for users, it functions as a currency that can be used across games compatible with Holoride as well as any future products that choose to integrate RIDE into the experience.
Another notable development in this area is the introduction of metaverse-based showrooms by Fiat and Kia. These showrooms provide an immersive environment for customers to browse various vehicles. Fiat’s store, called the Fiat Metaverse Store, was launched with the support of Microsoft and Touchcast during the Consumer Electronics Show this year. The showroom allows customers to explore vehicles in detail, down to their specific attributes, and even begin their purchase journey.
What’s more, Fiat’s metaverse showroom is integrated with OpenAI’s ChatGPT, a virtual ‘Fiat Genius’ that answers any queries virtual customers might have. This integration with OpenAI means that Fiat’s showroom will be accessible through Microsoft Teams, providing a seamless experience for customers.
In addition to Fiat’s partnership with ChatGPT, Kia Germany has also struck a deal with Engage, a business-focused metaverse platform, to create its own dealership in the virtual world. According to Kia Germany, the store will be accessible through mobile and desktop, as well as traditional VR headsets.
These developments demonstrate the versatility of the metaverse and web3 for expanding businesses, particularly in the automobile industry. With the potential of adaptive AI and Web3, businesses can take this technology further in the long term. As this technology continues to evolve, it will be interesting to see how businesses continue to incorporate it into their operations and how it transforms the industry as a whole.
8. Conclusion
The first quarter of 2023 has proven to be an exciting and groundbreaking period for the virtual world industry. We’re seeing traditional industries such as fashion and automotive exploring the metaverse and Web3 in meaningful ways. Add a record $503 million in investments in Q1 2023, and it’s clear that the metaverse is set to play a significant role in shaping the future of technology and digital experiences.
In this week alone, Decentraland and Yuga Labs fuel the excitement surrounding the potential of the metaverse. Decentraland’s MVFW 2023 showcased the next frontier of digital fashion, while luxury brands are embracing NFTs to engage with consumers. In addition, Yuga Labs’ second trip into the Otherside highlights the growing potential for immersive experiences.
While companies are shaping and building virtual worlds to explore, users are exploring what it means to own your online identity. Breaking free from tech behemoths like Apple, Facebook and Google, online identities are becoming a new frontier for individuality and digital ownership.
