Metaverse and Real Estate
23.02.2023
It may sound surprising, but nowadays people/companies spend thousands or even millions of dollars to acquire land that exists only in virtual worlds, also called metavers.
This is called virtual real estate, which is the buying, selling or operating of land, all in a virtual world. This is a market in its own right.
The best known metavers currently active in the real estate world are : The Sandbox and Decentraland.
In 2021, this market will already be worth 500 million dollars and it is estimated that it will be worth around 1 billion dollars by 2022. What may explain this craze is Mark Zuckerberg's announcement in October 2021 that he would create his own metaverse, as well as the change of name of his group: Facebook becoming Meta. This has prompted some giants in their field (Atari, Adidas, Carrefour, Gucci,...) to acquire huge plots of land on existing metavers. For example, Adidas bought 144 plots in The Sandbox for the equivalent of 1.7 million euros.
It is also important to note that the purchase of these plots of land is done with the cryptocurrency of the metaverse on which you wish to purchase your plot. For example Sand for TheSandbox and Mana for Decentraland.
The purchased goods are then given to you in the form of NFTs (Non-Fungible Tokens) which are forgery-proof digital property certificates. The fact that land purchases in the metaverse are made using a blockchain (generally the Ethereum blockchain) is very useful since it allows you to have a history of the owners of the land, as well as its evolution in terms of price.
But finally, how can one exploit one's virtual real estate once the purchase has been made?
There are a multitude of possibilities, some of which have certainly not yet been imagined, but here are some current examples:
Source
futura-science.com - Article
This is called virtual real estate, which is the buying, selling or operating of land, all in a virtual world. This is a market in its own right.
The best known metavers currently active in the real estate world are : The Sandbox and Decentraland.
In 2021, this market will already be worth 500 million dollars and it is estimated that it will be worth around 1 billion dollars by 2022. What may explain this craze is Mark Zuckerberg's announcement in October 2021 that he would create his own metaverse, as well as the change of name of his group: Facebook becoming Meta. This has prompted some giants in their field (Atari, Adidas, Carrefour, Gucci,...) to acquire huge plots of land on existing metavers. For example, Adidas bought 144 plots in The Sandbox for the equivalent of 1.7 million euros.
It is also important to note that the purchase of these plots of land is done with the cryptocurrency of the metaverse on which you wish to purchase your plot. For example Sand for TheSandbox and Mana for Decentraland.
The purchased goods are then given to you in the form of NFTs (Non-Fungible Tokens) which are forgery-proof digital property certificates. The fact that land purchases in the metaverse are made using a blockchain (generally the Ethereum blockchain) is very useful since it allows you to have a history of the owners of the land, as well as its evolution in terms of price.
But finally, how can one exploit one's virtual real estate once the purchase has been made?
There are a multitude of possibilities, some of which have certainly not yet been imagined, but here are some current examples:
- Renting out your space to companies: to turn them into coworking spaces, which companies would use for their business meetings. It is important to remember that one day all the plots in a metaverse like The Sandbox will have been bought, so the only way for those who want to use it will be to rent it out.
- Create an exhibition gallery: to display NFTs, and allow artists to rent space to display their work.
- Create an entertainment venue: a concert hall, a shop, a casino,...
- Advertising: if your plot is close to a busy place, it is possible to offer to rent your walls for advertising.
- Selling clothes: metaverse users are re-presented by avatars, some users have been seduced by the purchase of accessories or clothes to make their avatar unique. In some cases these purchases are digital only, but in other cases it is possible to buy real clothes from a metaverse.
- Organise events: by organising concerts, conferences, matches, which can only be accessed by buying an entrance ticket.
- Investing: some people have a more pragmatic objective, such as making long-term capital gains by buying plots of land in the hope that they will increase in value and then resell them at a profit. Or by immobilising tokens such as Sand or Mana, hoping to see their value rise.
Source
futura-science.com - Article