Business & Investment

South Korea’s “Gen MZ” rushes into “Metaverse”

© Reuters. Sean poses for a photo on a laptop showing his avatar at Decentraland in Seoul, South Korea, on August 13, 2021.Reuters / Kim Daeun

By Joori Roh

Seoul (Reuters)-South Korean engineer Sean has a big plan to turn the land that has earned millions of won (thousands of dollars) in recent years into a long-term money spinner.

“We are planning to design a building suitable for hosting K-POP live performances and K-drama screenings,” a 30-year-old investor told Reuters. “It could lead to a profitable business model in a couple of years.”

In addition, labor shortages and increased costs that have spurred the coronavirus pandemic will not hinder construction. All of Shaun’s epic projects are in the blockchain-based virtual world Decentraland.

“Metaverse” is a futuristic outlook for most people maybe. However, in South Korea, rising house prices and income inequality are increasingly tempting the so-called Generation MZ or Generation MZ into an alternative online world.

Their digital avatars play games, roam with friends, host social gatherings, shop and parties, and plan to build cities and profitable businesses.

Sean, who refused to be identified by anything other than the Decentraland avatar’s name, has gradually become absorbed in the platform over the past three years.

Users can buy land in this virtual world with the goal of hosting a real business, much like a nightclub that charges users access fees. As in the real world, the success of your business and the communities around it can add value to your virtual land.

And investment management companies, telecommunications companies, and even the Korean government are all plugging in.

Samsung (KS :) Asset Management will easily exceed the goal of the Samsung Global Metaverse Fund, which started in late June, to withdraw 100 billion won ($ 86.49 million) by the end of 2021, and about 1.2 billion won will flow in every day. I’m expecting it.

Choi Byung-gun, vice president of Samsung Asset Management, said that since the pandemic, people have become more interested in the Metaverse as they work in remote areas. Samsung Fund launched just two weeks after KB Asset Management’s KB Global Metaverse Economy Fund.

“The world’s leading tech companies like Facebook (NASDAQ :) are raked up for money as they see their business direction shift to the metaverse,” Choi said.

SK Telecom, the largest mobile phone company in Japan, launched the Metaverse “ifland” in July. This Metaverse allows residents to host and participate in meetings with other animated avatars.

“The pandemic era has shifted social trends to non-face-to-face, which has led to a surge in demand (for Metaverse services),” a SK Telecom official told Reuters. “Thousands of rooms are created every day and there are tens of thousands of users every day.”

SK Telecom is part of the “Metaverse Alliance” launched by the Korean government in mid-May and is attended by more than 200 companies and institutions.

An official from the Ministry of Science and ICT told Reuters that the government wants to play a leading role in the metaverse industry. With a budget of 604.4 trillion won in 2022 announced last week, the government has allocated 9.3 trillion won to accelerate digital transformation and foster new industries such as the Metaverse.

MZ Generation

Koreans are particularly open to the appeal of the Metaverse, even though it is unclear how much real-life reproduction is possible or how long it will take to develop.

Social experts believe that they are interested in disgruntled Gen Z (a term coined in a country that integrates Millennials and Gen Z, including those born in the 1981s and early 2010s).

As the coronavirus pandemic prolongs, a new glossary has emerged in South Korea for the “undamaged” economy, which is the opposite of “contact.”

“The enthusiasm for Metaverse reflects the sadness and anger of the MZ generation due to polarization,” said Kim, a professor of industrial engineering at Kangwon National University, who has published two best-selling books on Metaverse since late 2020.・ Sangyun said.

“They don’t think of the Metaverse as a real alternative or alternative. Instead, it’s just another part of their lives,” Kim said. “They, unlike the older generation, have been communicating with the world through devices since their birth.”

For 37-year-old Choi Ji-eun, it was a frustration with real-world real estate prices and regulations that prompted him to buy real estate on the geolocation-based platform Earth 2.

Hee-seop Choi’s investment of 50 million won in the expensive Gangnam district of Seoul 2 is a dream only in the real world.

“It was easy to buy and not as expensive as I expected,” he said.

Fueling many of the Metaverse platforms are non-fungible tokens (NFTs), intangible digital assets that cover everything from artwork and video to clothing and avatars purchased in cryptocurrencies. ..

Decentraland offers a limited number of Digital Lands (LANDs) in the form of NFTs obtained using MANA, a non-fungible token that acts as the currency of the game. MANA, an altcoin, can be purchased in fiat currencies on limited cryptocurrencies or in exchange for digital currencies such as Bitcoin and Ethereum.

As in the real world, lots near popular districts are more valuable than other lots. Some parcels, which sold for about $ 20 each when Decentraland was launched in 2017, are now changing for hundreds of thousands of dollars.

As the platform evolves, Sean and other landowners believe that they can make money by using the land for a variety of commercial businesses, such as building concert halls and billing for performances.

Decentraland’s changes and developments are overseen by the Decentraland Foundation, which was established as a non-profit organization that acts on behalf of users.

Real estate developer

Wang Keun-il, a 36-year-old fintech entrepreneur, owns land in Pyongyang, the capital of North Korea, Vatican City, and Earth 2 in Egypt, and plans to build a profitable tourism or education business. increase.

Launched in November, Earth 2 is not a full-fledged Metaverse environment, but a marketplace for selling digital tiles that represent part of the globe. Users are currently unable to “enter” the purchased land. In other words, the king bet on a world that has not yet been realized.

Earth2 CEO Shane Isaac said Koreans are the most active users of the platform on a self-affiliated basis, spending about $ 9.1 million, followed by the United States at $ 7.5 million and Italy, according to Reuters. Was $ 3.9 million.

According to Decentraland, the platform had more than 7,067 active users from South Korea in the 30 days until September 1, second only to the United States.

“Once things get back to normal, people won’t forget or leave the industry,” Dave Carr, communications leader at the Decentraland Foundation, told Reuters.

“If anything, this period defines the most important, valuable, or related entities and experiences.”

In the stock market, the net purchase of gaming company Roblox Corp has made it the top foreign stock purchased in June and July, according to Korea Securities Depository (KSD) data.

The share of local AR and VR technology companies MAXST and WYSIWYG STUDIOS has skyrocketed in recent months.

Earth 2 investor Hee-seop Choi is aware of the potential metaverse pitfalls, but is excited.

($ 1 = 1,156.2500 won)

South Korea’s “Gen MZ” rushes into “Metaverse” South Korea’s “Gen MZ” rushes into “Metaverse”

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