The metaverse was the talk of the technology sector over the last few years as stock market pundits outlined scenarios that involved virtual worlds generating trillions of dollars in value in the decades to come.

But 2022 delivered a different reality. The economy suffered a slowdown, and enthusiasm for long-shot tech projects that won't be profitable in the foreseeable future hit a low point. The Nasdaq-100 Technology Sector index epitomized that shift in sentiment with a decline of 33% in 2022, and many individual stocks sank even further. 

But the pessimism has let up in the early days of 2023. The sector index has registered a gain of 13% so far, and stocks typically associated with the metaverse -- like Meta Platforms (NASDAQ: META) and Snap (NYSE: SNAP) -- have soared even further. Let's explore why and what could be in store from here.

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Source Fool.com