Citi Says Metaverse Economy Could Hit $13 Trillion by 2030

The metaverse is an immersive digital world created by the combination of virtual reality, augmented reality and the internet. While some people are still skeptical about the metaverse, Citi says it sees tremendous potential in the concept of extended reality.

The investment bank, in a report issued Thursday, says the metaverse represents a potential $8 trillion to $13 trillion opportunity by 2030, that could boast as many as 5 billion users.

• “We believe the Metaverse is the next generation of the internet — combining the physical and digital world in a persistent and immersive manner — and not purely a Virtual Reality world,” the report reads. “A device-agnostic Metaverse accessible via PCs, game consoles, and smartphones could result in a very large ecosystem.”

• The content streaming environment of the metaverse will likely need a “computational efficiency improvement over 1,000 times today’s levels,” the bank said, and investment will be required in areas such as storage, network infrastructure, consumer hardware and game development platforms.

• The metaverse concept isn’t new, the bank’s analysts noted. However, interest in the metaverse really began to snowball at the end of 2021 because of the rise in sales of non-fungible-tokens (NFTs) and big technology companies announcing their interest in the sector.

• NFTs are digital assets on a blockchain that represent ownership of virtual or physical items, and can be sold or traded.

• Currently the most popular way to experience the metaverse is by playing a video game on a virtual reality (VR) headset, Citi said, but it is possible that the “metaverse is moving towards becoming the next generation of the internet or Web 3.”

• “This ‘open metaverse’ would be community-owned, community-governed and a freely interoperable version that ensures privacy by design,” the report said. Its use cases include commerce, art, media, advertising, healthcare and social collaboration, it added.

• What counts as money in this open metaverse is expected to differ from the real world, with different forms of crypto currency expected to dominate, alongside fiat currencies, central bank digital currencies (CBDCs) and stablecoins, the report said.

• If the metaverse is the new iteration of the internet, it is likely to attract greater scrutiny from regulators, policymakers and governments, and issues such as anti-money laundering rules, the use of decentralized finance (DeFi), crypto assets and property rights will all have to be addressed, the note added.

Read more: HSBC Launches Metaverse Fund for Asia Clients