There is next to nothing in the Metaverse but billions of dollars have already been spent on its lands

The Metaverse seems more and more a luxury item: for now it is a semi-deserted land where super-vip purchases, hyper-technological elites and investors make purchases.

Two billion dollars. The Metaverse is semi-deserted, but within a year a land worth two billion dollars was purchased. How is it possible? The answer is quite simple, the Metaverse is for the few people who have a lot of money. According to Morgan Stanley, the Metaverse will represent over 10% of the luxury market by 2030.

Inside, there are supervips who organize parties in luxurious toy villas, futuristic investors, the elite of the hyper-technological sector and pioneers who dream of leading the market in the promised land. For now, however, the metaverse is merely a wasteland colonized by thieves. Researchers at DappRadar, a portal that analyzes data related to the Metaverse, say that $ 1.93 billion was spent on cryptocurrencies last year to purchase virtual land. Yet the value of Decentraland and The Sandbox has plummeted for months.

Shopping in the Metaverse

Virtual property prices have increased 500% since the Facebook-Meta transition (October 2021). Homes in the virtual world cost as much (if not more) than homes in the real world. For example, an anonymous user paid $ 450,000 to purchase a property near Snoop Dogg. While Republic Realm, which develops virtual land, spent $ 4.3 million on land on The Sandbox. Tokens investment firm bought a tower (yes, like in the Middle Ages) in the Decentraland Fashion District for $ 2.5 million.

Paris Hilton has decided to treat herself to a private island on Roblox, she christened it “Paris World” and it is a replica of her mansion in Beverly Hills where she holds her historical parties in loop and organizes trips on her virtual yacht. Also follows Sara Sampaio, Victoria’s Secret model. She also bought a virtual island worth $ 71,000.

Why are the prices so high?

The units of measurement are not in square meters but in plots, lots or plots. Lands are small squares or rectangles on a large map, identified by specific coordinates. As of February 2022, 268,654 lots were available on the four main platforms (Decentraland, Sandbox, Somnium and Cryprovoxel), of which 62% on Sandbox. These 96-by-96-meter packages cost $ 12,700. On Decentralend, however, a 16X16 field is worth $ 14,400.

It could be the metaverse, but the dynamics are the same as in the real world. The Earth is not unlimited and, as always, scarcity generates value. Not only that, the price also varies according to the location, yes in the ether there is central and suburban, for example on Decentral and the lots near places like Dragon City and Vegas City are more expensive, many buy instead by betting that a certain area gets busy. The value of the land is also determined by the perceived importance of the platform on which it is located.

According to Yat Siu, co-founder of Animoca Brands, owner of Sandbox, “what makes virtual earth valuable is the fact that the most influential people in space are building it.”

How Decentraland works

Why buy land in the Metaverse

Metaverse Group, a virtual worlds real estate agency, said that “buying a home in the Metaverse is like arriving in New York when it’s all countryside and you have the opportunity to buy a piece of Soho. first virtual office, “the Metaverse will infiltrate all sectors, creating profit opportunities for more than a trillion a year. Bubble or not bubble, there are those who believe, invest and buy, right now on the market there are 12 real estate agencies just for the Metaverse.

It is bought mainly for three reasons. The first is a showcase function, so buy lots to display / display, showcase purchased items or even your own artwork. Who wants to build commercial enterprises, shops, galleries. It is no coincidence that the largest investments come from the fashion world (Gucci, Balenciaga, Tommy Hilfiger, Dolce & Gabbana). Amsterdam-based digital-only fashion house The Fabricator produces avatar-only clothing, designing bespoke collections and apparel for users of Decentraland, The Sandbox and other crypto metaverses. And there are also those who rent to the highest bidder and those who hope to sell their land at the right time.

The problem of decentralization

It is not necessarily profitable, but there is a problem, it is decentralized. There is not a single metaverse, there are many and it is possible that one or more may suddenly lose value. The risk is therefore to end up with land bought at crazy prices that are no longer worth anything. For example due to an unexpected devaluation. Everyone wants to sell, nobody wants to buy. Using the Metaverse Group metaphor (buying in the Metaverse is like taking a house in Soho before anyone else), the problem is that yes, it’s a bit like buying an apartment in Soho, but in a universe where more could be created. . endless versions of Soho.

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