What Is Metaverse Virtual Land: Booming Real Estate Market
Is digital real estate still real estate? Is a digital store still a store? These questions lie in the gray matter between the world of humans the world of our avatars. Or perhaps this is all hype and, like Google Plus or Vine, will dissipate into the black hole of tech. But, on the other hand, what if it’s the next form of internet, proving vital to the future of long-term commercial success?
What is the metaverse?
The metaverse is an online, virtual world that will combine multiple aspects of our digital and real lives, including work, socializing, and recreation. 2021 saw many tech giants, including Meta (previously Facebook), Microsoft, and Epic Games, begin developing and exploring the space.
Blockchain technology plays a crucial role in the metaverse as digital ownership, identity, and economies are central concepts. For a deeper explanation, read our introduction article to the metaverse.
What is Metagverse Group and Metaverse Vittual Land?
The Metaverse Group is a leading virtual real estate company offering exposure to this burgeoning industry via the Metaverses. We facilitate the acquisition of virtual property along with a suite of virtual real estate centric services that are provided by pioneers of the crypto, blockchain and non-fungible token (NFT) industries.
METAVERSE CURRENTLY OFFERs (OR PLAN TO OFFER) THE FOLLOWING SERVICES TO HELP YOU ENTER AND ENGAGE IN THE METAVERSE:
-Buying and selling of virtual real estate across the Metaverses
-Development of virtual land (we help bring your dream to life)
-Expert level consulting for all major metaverses
-Finding a rental within the metaverses to fit any need
-Property management of existing real estate
-Marketing and advertising your business in the metaverse
What are the use cases of metaverse land?
|Photo Business Insider|
Apart from speculation, landowners can use their virtual space in various use cases:
1. Advertising - If your plot is in a popular area or district and attracts many visitors, you can charge for advertising space.
2. Socializing -You can host events on your digital land, including concerts, conferences, and community meetups.
3. Gaming - Your NFT land might have a use in an NFT video game. For example, land in Axie Infinity can provide extra resources, tokens, crafting ingredients.
4. Work - Land that can be explored with a 3D avatar can be used as a virtual office space or to provide digital services. PwC Hong Kong will use The Sandbox land in their Web 3.0 advisory services.
|Are global companies purchasing metaverse land? |
Prominent celebrities and brands have already begun to purchase land in the metaverse. For example, Snoop Dogg is creating his own Snoop Dogg Metaverse Experience on The Sandbox. Adidas has also purchased space on the platform for their own AdiVerse metaverse experience. Apart from joining in the metaverse and NFT hype, brands and companies will offer users the chance to interact with them by accessing metaverse services, games, and products.
Risks of buying virtual land
As a new and emerging area, there are a number of risks associated with virtual land. To start with, there are general risks that come with any crypto project, which we won’t go into here as much has been written about it - for a quick overview check out this blog on risks of owning crypto.
When it comes to virtual land specifically, a few specific risks apply:
1) Too early to know which projects will win
Even if virtual land as a concept or asset class will go to the moon, it remains to be seen which developers will turn out to be the winners. Perhaps a new game will come out that has more interesting features or experiences and users will flock to the new platform, leaving Axie Infinity, Sandbox or Decentraland behind. Keep in mind that while Sandbox was originally launched in 2012, the blockchain game is a pivot from their original game and it’s only officially launched ist alpha in November 2021.
2) No true user interest
Some skeptics worry that virtual land is a hype amongst crypto-speculators but there won’t be enough real user interest in the end and not enough consumers who want to come and spend money on the goods and experiences being offered in the virtual world. The founder of Second Life Philip Rosedale for example - the predecessor of everything we’re seeing today - used to be a huge early advocate of the metaverse and proclaimed in 2007 the 3D web will be dominant and we’ll all have our avatars. Almost 15 years later Rosedale is still enthusiastic about the promise of virtual worlds - in specific use cases - but also has several words of caution on the metaverse. He warns of how it’s stressful not to be able to use facial expressions, how not everyone will prefer living in the metaverse, and how there are still significant technical barriers to be overcome to provide a seamless virtual reality experience.
“If you live a comfortable life in New York City and you’re young and healthy, you probably are going to choose to live there. If I offer you the life of an avatar, you’re just not going to use it very much,” Rosedale says. “On the other hand, if you live in a rural location with very little social contact, are disabled or live in an authoritarian environment where you don’t feel free to speak, then your avatar can become your primary identity.”
Metaverse virtual land is booming
Metaverse real estate sales reached $501 million in 2021 and could reach nearly $1 billion this year.
The virtual land market in the “big four” metaverses - namely, Decentraland, Somnium Space, Cryptovoxels and Sandbox - topped €440 million in 2021, and that figure is projected to double in 2022.
Sandbox, Decentraland, Cryptovoxels and Somnium are the top players in this market and real estate sales on these platforms reached $501 million in 2021, according to MetaMetric Solutions, referring to Sandbox, Decentraland, Cryptovoxels and Somnium.
Sales in January topped $85 million and could reach nearly $1 billion in 2022, the firm said.
"As the wider cryptocurrency market remains flat, the 3D world is expanding exponentially and looks likely to stay," said Nicholas Cawley, strategist at DailyFX. "Metaverse real estate is essentially large corporates investing substantial funds into building in the metaverse, which many see as an additional sales channel going forward."
|In November, Republic Realm, a metaverse real estate investor and advisory firm, said it had completed the largest ever land acquisition in the Sandbox in a deal valued at more than $4.2 million. |
The company is developing 100 islands, called Fantasy Islands, with their own villas. Ninety of the islands sold in the first day for $15,000 and some are now listed for resale for more than $100,000, according to CNBC.
The transaction represents over 7.9 million square meters of game area, the equivalent of 3 square miles or 1,200 city blocks.
6 Businesses That Have Bought Land in the Metaverse
It should come as no surprise that one of the first pioneers in video games and home computing would have taken early steps into the metaverse. Atari owns virtual property in both Decentraland and The Sandbox, metaverse platforms where visitors can play Atari-themed games and attend branded events, with plans to expand digital gaming opportunities across the board.
Electronics maker Samsung launched its metaverse location, known as Samsung 837X, in Decentraland earlier this year. It was designed based on the Samsung 837 store in New York City, where all sorts of products can be experienced directly, and it offers a similarly immersive experience with NFTs, games, product introductions, and live performances. Samsung also hosted a digital version of its Unpacked event at 837X, launching the Galaxy S22 phone, on Feb. 9.
Along with premiering one of many planned NFT collections in The Sandbox, sporting goods power Adidas purchased a plot of land there that it intends to fill with exclusive branded content, experiences, and items for purchase. The details at this time are thin, but Adidas describes the metaverse as "a natural place for Adidas Originals to enter: a wild world where possibilities are truly limitless and where anyone can express and be rewarded for their most original ideas."
Back in December, the international accounting firm PricewaterhouseCoopers (PwC)'s Hong Kong branch purchased a piece of land in The Sandbox. Although the metaverse probably won't spur a lot of new and exciting accounting breakthroughs, PwC doesn't want to miss out on the potential. William Gee, a partner at PwC Hong Kong, told the Wall Street Journal in a statement that "the Metaverse offers new possibilities for organisations [sic] to create value through innovative business models, as well as introducing new ways to engage with their customers and communities."
5. Prager Metis
Of course, The Sandbox isn't the only metaverse platform with an accounting firm. New York-based Prager Metis International LLC opened a virtual office building in Decentraland in December. The reason? Chief Executive Officer Glenn Friedman told the WSJ simply "if the metaverse is going to replace the internet, then certainly business is going to use it."
6. Miller Lite
With businesses flocking to the metaverse, there must also be Happy Hour. Don't worry, Molson Coors has it covered. It's constructed the Meta Lite Bar, just in time for the Super Bowl, with nothing but Miller Lite as far as the eye can see. Along with virtual pool tables and virtual beer on tap, visitors can win REAL suds and experience exclusive content on Game Day.
Prediction for the future
Metaverse real estate sales are projected to double this year
The market also has the potential to double in 2022, namely as the world’s four largest platforms for Metaverse real estate lead with $85 million in sales,
According to the report, Metaverse land sales began to skyrocket after Facebook announced in late October it had rebranded to Meta Platforms, with sales topping $133 million the following month.
MetaMetric stated its sales in January would potentially grow tenfold compared to the same period last year, despite a noted downward trend in sales following Meta’s late October update.
Paul Rogash, Chief Executive of BetU, told XR Today of the downward trend in land sales, stating successful cryptocurrency projects would feature services clients “genuinely want to adopt and use.”
A BrandEssence Market Research report found Metaverse real estate was set to rise at a 31 percent compound annual growth rate (CAGR) from 2022 to 2028, the report added.
Is the virtual land market turning into a digital property bubble?
But is the market overheating? Even some of the founders of these metaverses are cautioning against the inflated prices that plots of land in their virtual social worlds are fetching.
Speaking to Euronews Next, CEO and founder of Somnium Space, Artur Sychov, lamented the influx of financial speculation driving up prices in the ecosystem.
The frantic metaverse land grab is likely to persist in 2022 as investors realize virtual real estate equals cash, predictive analytics firm saysThe mad dash for virtual land is likely just beginning.
Real estate sales in metaverses like Decentraland and the Sandbox — where plots have sold for millions of dollars — are likely set to continue at a brisk pace before peaking in May, though interest will remain high even after, according to predictive analytics firm NWO.ai.
"We're really seeing the utility of these properties rising; we're seeing that people can make actual money, that buying these properties equals cash. That is going to drive those sales," said Julia Myers, a machine-learning engineer at NWO.
NWO, an artificial intelligence startup that launched almost three years ago, tracks millions of texts like news articles, social media platforms Twitter and Reddit, and Google Search, among other things, in order to predict broader emerging narratives. For example, NWO said its AI foresaw millions of retail traders driving massive gains in meme stock companies like GameStop a year ago, and it predicted troubles for Chinese real estate company Evergrande.
According to NWO, Decentraland has become the leading metaverse and upcoming events like Fashion Week are going to solidify that further. Surging interest in the metaverse has only been cemented by skyrocketing prices in the native tokens for metaverses like Decentraland, which has jumped 2,000% in a year, according to Crypto.com. Meanwhile, the Sandbox's underlying cryptocurrency has surged more than 8,000%, and Axie Infinity has risen 11,000%, crypto.com shows.
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