![]() It is exciting that we are now seeing major brands and property developers view virtual land and virtual real estate as a legitimate investment. In the metaverse, we’re already seeing different ways of utilizing virtual land. This is just like the real world where businesses are built on top of plots of land to increase the value of said land. However, the best way to make a profit with virtual land is by monetizing it. All these activities run very closely alongside real-world developments. We also see that, just like in the real world, there are people deep in the ecosystem of virtual lands that try to front-run development and buy up the most desirable land where they think they will be able to make a profit. We see that they both try to create partnerships with brands and other service companies to participate in the development and stay on long-term as lessee. In both real-world and virtual cases we see landowners coming together with designers and architects to map out incredible builds that consumers will love to visit. This goes for both real-world real estate and virtual real estate. Where things begin to get exciting in the cycle of real estate is when you start to draw out the similarities of building something on the land. Now, just like a great URL, having great pieces of land that are established with age, and near high-profile plots, will always hold value, so we would never argue a case that land would ever be worthless. There is no reason to believe that eventually, you will be able to register your plot of land on a website like GoDaddy for a handful of bucks per year. We view virtual land as being just like a URL would be for a website hosted within a larger ecosystem. Over that same period, the virtual land market grew 879%, per Chainalysis. To compare growth rates, between 2019-2022 the real world real estate market experienced growth of approximately 39%. proximity to top experiences, utility, etc.), the land will have a different floor price.Ĭurrently, the virtual land market holds a valuation of ~$1.6 billion across eight major metaverse platforms: These land parcels can be bought and sold on marketplaces like OpenSea between stakeholders. When all things are taken into consideration virtual land is simply coordinates (or parcels) within a larger map. As we can see from the above example of The Sandbox map, land prices that are in the center of the map hold a much higher average than the plots that are on the outskirts and not in high-traffic areas. We see this exact same thing happen in the virtual world, too. Property valuations in The Sandbox by desiribility If we take Miami, and any other city in the world, we tend to see that certain neighborhoods are much more valuable due to their location, which creates greater demand, leading to a higher floor price for homes, condos, and other properties. ![]() Property valuations in Miami by desiribility ![]() Everyone wants to be right next door to Snoop Dogg or Atari instead of out in the middle of nowhere on a tiny 1x1 island. We see the exact same thing with virtual land. Real-world land will typically hold higher values when it is near other high-trafficked areas or near attractions that people tend to visit often. There has been a lot of emphasis on the land portion of virtual real estate in recent months and although that can be an exciting venture, we view that in a very similar way that we see physical land in the real world. The metaverse may seem like a mystifying place for many people, but when you begin to see the parallels the metaverse has in relation to IRL real estate, you begin to see a clear vision of why the two really aren’t that different.
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