Investors Continue to Snap Up Metaverse Real Estate
There is a significant rise in virtual land transactions and the driving principle in this new goldrush is the same as that of the physical world: location.
Interest in the metaverse is growing exponentially. In fact, there have been recent performances by top artists including The Weeknd, Ariana Grande, and Travis Scott in the metaverse, an immersive and four-dimensional virtual world that will come to dominate our lives in the future.
In Bieber’s metaverse performance, fans simply watched his avatar sing hits from his album “Justice”. This kind of activity is attracting interest from investors in the digital land boom and many are now snapping up prime real estate in the metaverse such as shopping malls, concert venues as well as other kinds of properties.
Facebook’s Rebrand to Meta Triggered Interest in the Metaverse
The concept of the metaverse has been around for decades but it is Facebook’s recent rebrand to Meta and its pivot to the development of the metaverse which has attracted the massive interest we are now seeing. The digital currency fund Grayscale estimates that the global market in the goods and services sold in the metaverse will soon hit $1 trillion.
The metaverse is a cascade of multiple digital realms. There are different kinds of platforms that can be metaversal and each of these is developing independent of the other at the moment. It is expected that these worlds will in the future fuse into an all-encompassing metaverse.
Each of the metaverse worlds is like a 3D virtual city where users’ avatars can work, play, shop, and live.
There are some popular games that already offer users a glimpse of what the metaverse will look like. Perfect examples of these include Animal Crossing, Fortnite or the Roblox Universe. Each of these video games or virtual worlds consists of multiple metaverse elements such as virtual reality, mobile gaming, video streaming, artificial intelligence, and avatars. All of these elements are what combine to form the metaverse. In the future, these will seamlessly integrate technologies such as haptics and augmented reality.
Like in the physical world, the virtual land boom in the metaverse is still very speculative and it is unclear whether this boom will be sustainable or whether it will collapse.
Many futurists and those in the metaverse industries think the metaverse is going to evolve into a fully functioning economy just like the internet did in the 1990s and that this will happen within a very short time. As technologies such as AR, VR, mixed reality, and haptics evolve, many believe that the metaverse will eventually be integrated into our real lives to an extent that it will be normal to live and do stuff in the metaverse.
The main currency in the metaverse world is cryptocurrency. The finance in the metaverse is based on blockchain.
NFTs Becoming an Important Element of the Metaverse
A few months ago, we would probably have thought of the metaverse in terms of virtual reality, augmented reality, video streaming, avatars, holograms, mobile gaming and the range of experiences that this ecosystem will churn out.
In recent months, an important new element has entered the metaverse: nonfungible tokens. Users in the metaverse can now mint, buy or trade in unique digital items such as music, art, games, or virtual lands as nonfungible tokens. The NFT is a digital representation of a digital or real-world items and provides proof of ownership of the item. Trade in NFTs is now worth billions of dollars globally.
Volume of Transactions Increasing
The volume of transactions in NFTs has been growing exponentially in the past few months. The blockchain technology company Tokens.com which specializes in nonfungible tokens and metaverse real estate snapped up 50% of Metaverse Group in October. The Metaverse Group is a virtual real estate company. The deal was worth $1.7 million. The Metaverse Group itself is based in Decentraland in Crypto Valley, the metaverse’s equivalent to Silicon Valley. Decentraland even has virtual districts for arts, gambling, fashion, and shopping.
The Metaverse Group also has a real estate investment trust and the company is planning to build a property portfolio in Decentraland and in other metaverse realms like Upland, Space, Somnium, and Sandbox. Decentraland consists of 90,000 parcels of land with each of these measuring 50 feet by 50 feet. Some investors are seeing gold in these pixelated lots.
A week ago, Tokens.com spent $2.5 million on a land deal based in Decentraland’s fashion district. According to the company, this was the biggest real estate transaction in metaverse industry and it is planning to develop this into a virtual commerce hub targeting luxury fashion brands.
At the moment, the virtual realms in the metaverse look like cartoonish fantasy worlds. Other metaverse worlds consist of digital applications of the planet.
There is SuperWorld, for instance, a virtual real estate platform that has been mapped over the whole globe and consists of 64.8 billion plots of land. Each of the plots is available for sale as an NFT. Once a user buys a plot as an NFT, they will earn a share from the commerce happening on their lots. This metaverse real estate is expected to power commerce that will, in turn, transform the metaverse.
The prime virtual lots in the metaverse can become focal points for commerce in which products in the real world can be traded for NFTs. These NFTs will also be the digital representations of the products and will offer proof of ownership.
It is the early stages, though. But these NFTs and digital lots will be the collectibles of the modern era. At the moment, there are only a few digital realms where users can buy or sell virtual lands. All of these platforms use cryptos.
Some of the metaverses or proto-metaverse worlds also have marketplaces where investors can browse the NFTs as well as the plots that are offered for sale.