The metaverse changed many conventional digital precedents by presenting a new perspective on digital transformation. The concept of an open and shared world accessible to everyone with a phone and internet connection is admirable. On the other hand, it is important to look at the value offered by the real world use cases of metaverse. Or should you look in reverse? Interestingly, metaverse real estate has turned into one of the hottest phenomena in the crypto and NFT space recently.
The value of real estate in the metaverse might seem a bit absurd in the beginning. However, pieces of virtual real estate in the metaverse have been sold for almost $2 million. The following discussion offers you introductory insights on real estate in the metaverse and everything you need to know about virtual real estate. Please note that this post does not offer any metaverse real estate investing tips or suggestions. The following post helps you understand what exactly has been fuelling the value of real estate in the metaverse.
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Basics of Metaverse
The Metaverse envisions a three-dimensional virtual world where users are linked to each other in different aspects of their life. Users can explore different websites across various platforms through a single web browser. The metaverse allows users to participate in engaging, immersive experiences through augmented reality and digital avatars.
You can use a VR headset for working in a virtual workspace or play a game for relaxing after work. Apart from the facility of gaming and socialization experiences, the metaverse also opens up the roads for decentralized governance, independent creator economies, and digital identities, among other use cases. So, where does metaverse property come into the equation?
Wondering about how to level up your career with Metaverse expertise? Read: How To Become Metaverse Expert
Real Estate in Metaverse
The facility of virtual real estate or land in the form of NFTs in the metaverse changed the conventional perspectives on digital assets. Almost every aspect of our life has been shifting towards the virtual domain alongside the arrival of new technological advancements. In the face of a global pandemic, the whole world learned how to shift work and school to the digital world.
The concept of a metaverse serves as the ideal choice for elevating the prospects for digital transformation activities. This is practically one of the reasons for considering the potential of real estate in metaverse in the form of NFTs. Non-fungible tokens have become unique entries in the crypto space for the newly revised concepts of ownership.
NFTs have become a unique tool for enabling prospects for virtual real estate in metaverse platforms. Therefore, real estate in the world of metaverse basically means an NFT corresponding to a parcel of virtual real estate on the platform. In addition, the scope of metaverse real estate applications also points towards linking real-world property with virtual real estate NFTs.
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Why is Metaverse Real Estate Gaining So Much Hype?
The most obvious factor you look for in an introduction to metaverse real estate investing is an outline of reasons for the growing hype around real estate in a virtual world.
For starters, take note of the fact that a fan of Snoop Dogg paid a whopping $450,000 for purchasing virtual land in the Sandbox metaverse, near Dogg’s virtual estate in the metaverse. The famous American rapper has been working on the development of his personal interactive world in the Sandbox metaverse.
The “Snoopverse”, as it is titled, appears as a Voxel art variant of Snoop’s real-life mansion in California. Snoop Dogg has curated around 22 different plots of land, three estates, and 67 plots of premium land. Celebrity involvement in metaverse real estate basically spells out promising opportunities for driving adoption of the new trend.
The next crucial factor underlining the unprecedented growth in attention on ‘what is virtual real estate’ is the unreal pricing of virtual real estate. The $450,000 paid by Snoop’s fan is just the tip of the iceberg. Apparently, the world’s largest virtual world or metaverse platform, i.e., the Sandbox, accounted for almost 65000 virtual real estate transactions in 2021.
The value of transaction volume generated by the Sandbox with virtual real estate in metaverse amounted to almost $350 million. On the other hand, Decentraland, another popular metaverse platform with virtual estate, also showed promising performance in terms of transaction volumes. Decentraland registered around 21,000 virtual real estate transactions in its metaverse, amounting to a total value of $110 million in 2021.
On average, the prices of virtual real estate have skyrocketed from $100 to almost $15,000 in just one year. During the period from November 2021 to January 2022, the transaction volume of real estate in metaverse amounted to almost 8000 lands every month. The average transaction price in such cases is around 3.5 ETH, equating to almost $13,000. However, the average price of metaverse real estate has escalated since January 2022 beyond the margin of 5 ETH, equating to over $18,000. Such unreal price estimates present the obvious reason for growing popularity of real estate in the metaverse world.
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What Is The Value of Real Estate in the Metaverse?
The value of real estate in different metaverse platforms does not necessarily refer to their average pricing. On the contrary, the value of metaverse property focuses more on what you can do with it. Let us take the example of the Sandbox metaverse for understanding what you can do with virtual real estate.
The Sandbox metaverse allocates virtual land as a token which serves as digital proof of ownership of virtual real estate. Users purchasing virtual real estate in the metaverse could add their own creations in the form of games and assets. The Sandbox users or brands could create the tokens for assembling user-generated content.
Improving the Metaverse Experience
Users can trade the metaverse real estate as non-fungible tokens or NFTs on different popular marketplaces. The primary objective of virtual real estate in the metaverse in such cases focuses on improving the experience of the metaverse in different pieces of virtual land. On the other hand, it can also offer flexibility for designers to add the necessary creative elements.
New Opportunities for Marketing
Virtual real estate in metaverse has many other potentially productive implications for virtual real estate owners. For example, virtual real estate owners could build different types of gaming experiences in the metaverse. Now, the landowners can offer the experiences to the other users at a price or free of cost.
The advantage of creating unique digital experiences for specific virtual real estate also opens up better opportunities for advertising. For instance, a piece of real estate in metaverse offers an adequate foundation for creating billboards or developing digital museums for displaying NFT collections. However, location will play a huge role in determining the feasibility and potential of virtual real estate spaces to serve marketing purposes.
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How Do I Get My Hands on Virtual Real Estate In Metaverse?
The staggering popularity of metaverse real estate alongside its promising use cases paints a positive picture of virtual real estate. At the same time, one would wonder about the best possible channel for accessing the metaverse. Interestingly, you don’t have to search far and wide to get your hands on real estate in metaverse platforms. Speaking of metaverse platforms, you can start your journey of buying virtual real estate by signing up on a popular metaverse platform. The Sandbox and Decentraland are the two popular choices you have for entering the world of virtual real estate in the metaverse.
Subsequently, you would need a digital wallet with the required resources for procuring virtual real estate. Interestingly, you have the option of purchasing, renting, selling, or even flipping virtual real estate metaverse has to offer. All the troubles of ownership become irrelevant due to the verified NFT title allocated to each virtual real estate.
Want to know which metaverse is the best- Decentraland or Sandbox? Read: Decentraland vs Sandbox
You can follow the simple steps mentioned below to try your hand in metaverse real estate investing without any complexities.
- Access the metaverse platform and explore their property marketplace
- Browse through the different pieces of virtual real estate and compare them on the basis of pricing.
- Review the details of the piece of virtual land you want to purchase by clicking on it. For example, you might find information about the cryptocurrencies supported for the purchase.
- In the next step, you must link the metaverse platform account to your digital wallet. One of the most compatible digital wallets for metaverse real estate transactions obviously brings Metamask into the discussion. It offers seamless compatibility with a wide range of property platforms in the metaverse.
- Make sure you have the specific cryptocurrencies required for the transaction to purchase virtual real estate. You can purchase the desired amount of cryptocurrencies from various exchanges and store them securely in the digital wallet.
- Once you have completed all the formalities, you can just select the virtual real estate on the metaverse platform and pay the required funds through your digital wallet. After you click on the ‘Buy’ button, you can receive proof of ownership of the virtual real estate in the form of an NFT. You would receive the NFT directly in the digital wallet linked to the metaverse platform. You can view your metaverse property in your digital wallet under the “NFTs” tab of the wallet.
The simple procedure to purchase virtual real estate in metaverse is commendable. You don’t have to complete any authorization procedures or learn technical know-how for purchasing real estate in various metaverse platforms. All you need is a digital wallet, an account on the metaverse platform with virtual real estate, and a working internet connection. Within a few simple steps, you can procure the virtual real estate of your choice by spending the required amount of cryptocurrency.
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The final impression regarding the significance of metaverse real estate draws a favorable picture for growth of virtual real estate. The point of discussion is gradually shifting from the definitions of virtual real estate towards the value it offers. As many brands are trying their hands at advertising in the metaverse, virtual real estate can serve a vital role.
In addition, the easy accessibility of virtual real estate in different metaverse platforms presents better prospects for its adoption. With formidable solutions for doubts regarding the valuation of virtual real estate in terms of utility, the future for real estate in the metaverse appears bright. However, you need to proceed with caution in all your initiatives for investing in real estate in the metaverse. Learn more about the implications of real estate in the metaverse before making any decision right now.
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*Disclaimer: The article should not be taken as, and is not intended to provide any investment advice. Claims made in this article do not constitute investment advice and should not be taken as such. 101 Blockchains shall not be responsible for any loss sustained by any person who relies on this article. Do your own research!