Real Estate in the Metaverse: Investing in Virtual Land

The concept of real estate in the metaverse is gaining momentum, and it is becoming an investment opportunity. The virtual land is not a tangible asset, but it can be built upon to create experiences that lend themselves to advertising, marketing, socializing, and entertainment. Corporate headquarters, billboards, and casinos where games can be played online by 3D avatars are some of the properties being built in this virtual environment.

Determining the Value of Virtual Land

The value of each plot of land depends on the experience it provides, collectability, platform popularity, and market sentiment. In June 2022, Facebook announced its name change to Meta, signaling its interest in the metaverse, and digital real estate value increased. According to market data from MetaMetrics Solutions, it is estimated to increase further by a 31% compound annual growth rate (CAGR) from 2022 to 2028.

Decentraland: A Prime Example

Decentraland is a prime example of the potential of real estate investment in the metaverse. The creative director of Decentraland Foundation, Sam Hamilton, says that the speculators already made a lot of money when they sold land at $20 a pop, and the cheapest you can buy now is $3,500. In 2021, a 116-parcel plot of digital land in Decentraland sold for a record €2.49 million worth of cryptocurrency.

“It’s not the land itself that’s important, it’s the experience you build on top of that land,” explains Hamilton. Different parts of the Decentraland have varying demands, just like in the real world. If you can park your experience where all the nightclubs and casinos are, it’s much more valuable than somewhere else on the map.

Sales Figures and Opportunities in the Metaverse

In total, Decentraland recorded sales of €514 million in 2021, and that figure is expected to exceed €1 billion in 2022. The two-day Dubai Metaverse Assembly brought together more than 300 experts to discuss opportunities in the virtual environment. Dubai’s overriding metaverse strategy aims to create 40,000 jobs and add more than €4 billion to the emirate’s economy in the next five years.

Future Technologies in the Metaverse

The metaverse is still a young concept, but with rapid advancement and investment, it is becoming more and more plausible. The introduction of a new VR headset this year and a language tool facilitating instant translation in the metaverse are some of the future technologies revealed at the assembly. Additionally, Meta is set to introduce a haptic glove that will allow users to experience the metaverse physically.

Investing in Virtual Real Estate: A Speculative Venture

Investing in virtual real estate is a speculative and risky venture, but it can be rewarding. It is essential to conduct thorough research before investing in virtual land. Consider the potential of the land, its location, and the experience you can create on it.

The metaverse is an exciting concept, and its potential is vast. You could have an avatar of guitar legend Brian May giving haptic glove wearers lessons in a digital recreation of the famous concert venue Madison Square Garden. It is a piece of virtual real estate that would be worth a lot more than a song.