The market appears convinced of two conclusions:
- The metaverse will define the future for growth investors, and
- NFTs were just a fad
We are here to tell you that those two ideas cannot both be true.
If the first one is right, the second one MUST be wrong. Either that, or Goldman Sachs, JPMorgan, Morgan Stanley, Bank of America, and Citigroup analysts are all dead wrong, and the metaverse isn’t the $8 trillion juggernaut goldmine at the top of the growth theme chart over the next decade.
Why do we say this? Because the metaverse is built on NFTs.
The idea is a very simple construct. Scarcity is necessary for value to exist. Anything that exists in infinite supply and finite demand is economically worthless. This is pure Econ-101: The relationship between supply and demand defines price. Price goes to zero if supply infinitely outpaces demand.
Any digital good can be infinite in supply. Hence, things like digital real estate, avatar accessories, virtual tickets, video clips, digital artwork, and anything of the kind MUST approach zero in price over time unless some protocol enters the equation to bound supply and create an objectively tamperproof condition of scarcity – a supply ceiling.
This concept of imposing an artificial constraint on the supply of digital goods is the very foundation of the metaverse. Without it, something like Decentraland could never get off the ground. It is this construct of artificially imposed but tamperproof scarcity in digital goods – the very definition of non-fungible tokens – that makes economic value possible in the digital realm.
Why should this be especially important right now? Because companies that have already pushed to the top of the NFT space in the stock market are sitting at bargain basement levels right now. And that might represent one of the defining investment opportunities of the next decade.
With that in mind, we take a look below at some of the most interesting stocks in the space.
Integrated Media Technology Ltd. (Nasdaq:IMTE) is a technology investment, product development and distribution company. It engages in developing, manufacturing, and distributing of 3-dimension display equipment and wholesales audio products.
The firm focuses on the business activities in the sale and distribution of autostereoscopic 3D display, 3D conversion equipment and software, development and sale of 3D autostereoscopic technology and provision of 3D consultancy services. Its products include Glasses-free 3D Video Wall, Glasses-free 4K 3D Display, 4K3DPro Super Workstation, Visumotion, Glasses-free 3D Mobile Devices and MemtoTM Picture Frames.
Integrated Media Technology Ltd. (Nasdaq:IMTE) recently announced that its subsidiary, World Integrated Supply Ecosystem Sdn. Bhd. (“WISE”) has secured a minimum of 3 containers of durian product for sale in April pursuant to a supply agreement with CSL Durian Holding Sdn. Bhd. WISE is expected to take delivery and sell these durians in April to the Asia and China markets. Additional supply of containers of durian will depend on WISE’s sales orders. WISE is a Malaysia company engaged in the business of the provision of Halal certification to qualified businesses / operations, the establishment of Halal products supply chain, and sale of Halal products.
Dato’ Megat Radzman, CEO of WISE, stated “We are excited to secure the first supply of the highly sought durian products from Malaysia. This is our first foray in the sales of durian products, and we intend to use this as an entry into new market to promote our Halal certification, and product and services.” Dato’ Megat Radzman further added, “There are strong demand for halal products worldwide. We are now following up on enquiries from Asia and Europe interested in working with us on Halal products. We hope to open the European markets through a strategic link up with distributor(s) in Europe, as this will be one of the key markets for us going forward.”
If you’re long this stock, then you’re liking how the stock has responded to the announcement. IMTE shares have been moving higher over the past week overall, pushing about 38% to the upside on above average trading volume.
Integrated Media Technology Ltd. (Nasdaq:IMTE) is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($3M against $6M, respectively).
B2Digital Inc. (OTC US:BTDG) is another stock that stands to potentially explode on the metaverse and NFT themes as the gain traction with market participants this year. The company has already cultivated one of the fastest growing and most dynamic brands in the MMA and combat sports fitness marketplace.
The company is already pulling in millions on the revenue side as the “farm league to the UFC”. It has also developed a strong model to drive sales through a gym/training segment that leverages its MMA media brand to drive sales and expansion. This model helped to drive triple-digit percentage growth over the past year in basically all of the company’s major metrics, including revenues, ticket sales, and gym memberships.
B2Digital Inc (OTC US:BTDG) has recently expanded its strategy to include a powerful metaverse presence. After recently announcing a partnership with Metaskins, the company is now setting up debut its brand in Decentraland through its upcoming major MMA event, “B2FS 153”, which will take place on March 26 in Dothan, Alabama, and will be the Company’s first MMA event hosted live in the metaverse.
In addition to taking place live from the Dothan City Civic Center, and in addition to being broadcast live on Pay-Per-View and over the B2 Fighting Series apps on Amazon Fire TV and Apple TV, B2FS 153 will also take place virtually at the Aquarium Casino in the Vegas City district in Decentraland (-140,127).
But it isn’t just using this virtual presence as a new avenue for content distribution. It is also building the strategy out with what appears to be a full NFT strategy after announcing this week its upcoming launch of digital wearables technology.
The Company’s new customized B2 Wearables NFT merchandise will be air-dropped at B2FS 153 at the Aquarium Casino on March 26. New Wearables merchandise will be sold for 6 MANA (approximately USD $15). This event will launch the Company’s NFT strategy, which will be augmented further by additional digital goods, including fight video clips made during the event from B2’s live stream inside the Aquarium Casino to be sold at the next B2FS metaverse event.
B2Digital Inc (OTC US:BTDG) CEO Greg Bell noted, “We have been building toward this step, and our partnership with Metaskins Studios has put us in position to roll out an aggressive NFT strategy beginning with our wearables offering at B2FS 153. This offers the Company a completely new channel for revenue creation as well as a sticky new avenue to continue driving brand awareness within a rapidly growing new media universe. But this is just the start of our NFT strategy. We have a number of other offerings on the way, and we look forward to providing additional details in the very near future as we establish B2 Digital as the emerging market leader in Mixed Martial Arts in the metaverse.”
DraftKings Inc. (Nasdaq:DKNG) operates as a digital sports entertainment and gaming company. It operates through the Business-to-Consumer (B2C) and Business-to-Business (B2B) segments.
The B2C segment focuses on providing users with daily fantasy sports (DFS), sports betting (Sportsbook), and online casino (iGaming) products. The B2B segment develops, designs, and licenses sports betting and casino gaming software for its Sportsbook and casino gaming products.
DraftKings Inc. (Nasdaq:DKNG) recently announced that it has introduced the Primetime NFT Series, designed to deepen engagement and reward collectors on DraftKings during these defining moments. The first Primetime NFT Series drop will be the 2022 College Hoops Collection that launches just in time for March’s college basketball national tournament. This marks the first fully in-house NFTs launched by DraftKings Marketplace with drops set for key moments throughout the event.
“DraftKings is already deeply embedded within the biggest moments in sports, and the new Primetime NFT Series will further drive engagement while also providing rewards that bridge to our gaming offerings for the first time,” said Matt Kalish, Co-Founder and President of DraftKings North America. “Few times on the sports calendar can match the drama and spectacle of March’s college basketball tournament, which is why we chose this monthlong event to initiate this new digital collectibles program.”
Even in light of this news, DKNG has had a rough past week of trading action, with shares sinking something like -7% in that time. That said, chart support is nearby, and we may be in the process of constructing a nice setup for some movement back the other way.
DraftKings Inc. (Nasdaq:DKNG) managed to rope in revenues totaling $473.3M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 46.9%, as compared to year-ago data in comparable terms. In addition, the company has a strong balance sheet, with cash levels exceeding current liabilities ($2.2B against $929.4M).
Other key names in the NFT space include Takung Art Co. Ltd. (NYSE American:TKAT), Funko Inc. (Nasdaq:FNKO), PLBY Group Inc. (Nasdaq:PLBY), eBay Inc. (Nasdaq:EBAY), and Cloudflare Inc. (NYSE:NET).