South Korea's Ministry of Science and ICT recently announced investments in a fund dedicated to driving metaverse initiatives in the country, Cointelegraph reports.
South Korea is now capitalizing on the metaverse's potential as a new economic growth engine as more governments crack down on cryptocurrencies and companies turn their backs on metaverse projects.
South Korea Introduces 'Metaverse Fund'
In a press release, the South Korean government announced that it had invested 24 billion Korean won ($18.1 million) to establish a fund of more than 40 billion Korean won ($30.2 million) for metaverse development.
Cointelegraph tells us that the Metaverse Fund will aid in the mergers and acquisitions of various firms in the metaverse ecosystem. The government intends to assist domestic metaverse-related businesses in competing with global players.
South Korea aims to support local players actively, in addition to mergers and acquisitions, by assisting in raising capital through private investments. Given the underlying investment risks, the government agrees that it is difficult for local players to raise money through private investments.
Is There a Future with the Metaverse?
The metaverse, a virtual world where users can interact in real-time, has been heralded as the next technological frontier. However, the high development costs and lack of clear revenue streams have made some businesses wary.
Meta, for example, is said to be having difficulty attracting users to its Horizon Worlds platform, which was launched in 2021 - even begging employees to use the medium, The Verge reports.
Meta also admitted that its massive job cuts in November 2022 affected the Reality Labs and Family of Apps (FoA) segments, impacting its metaverse development.
However, South Korea's decision to double down on the metaverse is noteworthy, given that some other tech firms are demonstrating a growing interest in the metaverse.
This was cited as justification for the government's investment in the fund. South Korea aims to stay ahead of the competition in this emerging field by investing in the metaverse.
According to Statista, the metaverse market was anticipated to reach 47.48 billion U.S. dollars in 2022 before soaring to 678.8 billion U.S. dollars by 2030.
South Korea Embraces Latest Tech
In case you missed it, South Korea's Ministry of Science and ICT announced in February that it would invest $642.5 million (826.2 billion won) in companies developing advanced AI processors through 2030.
The Korean government wishes to establish itself as a major player in the rapidly expanding global market for next-generation AI chips. This is why it is not surprising that Seoul is also betting on the metaverse.
According to Cointelegraph, Seoul also launched a digital replica of the city in the metaverse in January, spending approximately 2 billion won ($1.6 million) on the project's first phase.
Along with this rapid tech push, Korea Herald tells us that the country recently announced its first independent sanctions against specific North Korean groups and individuals for cryptocurrency thefts and cyberattacks.
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