What if the Metaverse stopped even before it took off?

The signs are all there: declining investment, attention, attendance, and consumption: NFT and cryptocurrency included. Not only that: even the last annual Metaverse Fashion Week in Decentraland recorded much lower numbers than a year ago. That’s why many consider the Metaverse already doomed, while fashion seems to still believe in it

Metaverse, the next big flop or the next big boom? If we take the current numbers, there is little doubt: the Metaverse seems to have stopped even before it took off. However, fashion brands still believe in it and invest in it, which fuels the thought that the development of the Metaverse is only a matter of time. What is certain, however, is that the past year has seen a drastic drop in public attention and investment in the Metaverse and the NFT context. The ensuing cryptocurrency crisis and the abrupt halt in Meta’s ambitions have only raised doubts. So: is the Metaverse, as we know it, already doomed?

Players in difficulty

Decentraland, the virtual world of reference where users trade digital real estate, such as NFTs, appears to be in trouble. The website beincrypto.com reveals that, according to the latest reports, on average, there are only 20-30 people per week buying and selling on the platform for a turnover of around $50,000. Not much compared to the millions of dollars traded in late 2021 and early 2022. Other significant players in the sector also have sharply declining numbers – for instance, The Sandbox, which has 522 active users per week.

Did the Metaverse stop before it even took off?

The second annual Metaverse Fashion Week in Decentraland took place in the last week of March. Among the top brands were Tommy Hilfiger, DKNY, Adidas, Dolce & Gabbana, and others. But while in 2022, the event had recorded over 100,000 unique visitors, this year, the number dropped to 26,000, according to data provided by Decentreland to MarketWatch. During Metaverse Fashion Week, users spent around 26,000 to buy wearable skins from fashion companies and requested around 76,000 free wearables. In other words: virtual objects with which you can dress your avatar.

Yet still

Despite plummeting numbers, and unlike other companies that have already abandoned the Metaverse, fashion is still investing in this sector. The revenues listed above are very few compared to the billions fashion labels take each year. Still, they are considered indicative of the potential that digital worlds have to appeal to younger audiences. “Brands want to experiment and also see if virtual fashion can influence physical fashion,” Cathy Hackl, Chief Metaverse Officer, and founder of consultancy Web3 Journey tell CoinDesk.

“Tommy Hilfiger reported that they had four times as many attendees as last year’s MVFW,” says Gigi Graziosi Casimiro, head of Metaverse Fashion Week at MarketWatch. “Although the number of participants decreased, we had tens of thousands of new visitors. We believe we have improved on last year’s experience and are still in the early days of metaverse fashion,’ Graziosi Casimiro concludes.

Express yourself

According to the latest Metaverse Fashion Report by Roblox, one of the main reasons why Metaverse fashion sells so well is that about half of the Gen Z users surveyed said that dressing their avatars on virtual platforms allows them to express their individuality and feel good about themselves. This is why fashion seems to be the business most eager to seize the opportunities (and risks) associated with this sector.

The Fabricant case

The Dutch brand The Fabricant produces only avatar clothing. It designs bespoke collections and garments for users of Decentraland, Sandbox, and other metaverses. The brand also holds the sales record for a digital outfit ($19,000 for an NFT) and has raised over $14 million in funding from private investors.

But to whom does The Fabricant sell? And which market feeds the Metaverse? Cathy Hackl of Journey told CoinDesk that there are four main markets. First: native Web3 consumers who buy NFTs to wear in the metaverse. Second: gamers on popular platforms like Fortnite and Roblox. Third: digital art collectors who buy to speculate. Fourth: users of social media and platforms like Instagram and TikTok who will dabble in AR filters and digital tailoring. Will this be enough to fuel the future boom of the Metaverse? (mv)

Read also: