Do you dream of having your own plot of land, but think real estate prices are out of reach? Introducing virtual real estate: you can now buy, build and lease out property in the metaverse in exchange for just a few grand.
The concept of the metaverse – a virtual world where one can live, work, and interact with others through a VR headset – has garnered strong public attention since corporate giants such as Meta ($META), Apple ($AAPL), Disney ($DIS), and Netflix ($NFLX) started investing billions into its development.
Corporations are not alone either: the Pacific nation of Tuvalu made news earlier this month for getting involved. At COP27, foreign affairs minister Simon Kofe announced that the sinking of Tuvalu had forced its people to digitally recreate the island on the metaverse for its survival. As some sort of proof, the recorded video of Kofe’s address panned out to show that he was actually presenting from within the metaverse.
While the scepticism surrounding the success of the virtual world is still quite high, forward-looking tech enthusiasts may find the concept of virtual property investment an appealing endeavour.
Here’s how it works. Metaverse land is sold in the form of non-fungible tokens (NFTs) that may be purchased using either cryptocurrency or fiat, depending on the broker (yes, there are metaverse property brokers already). Once the virtual land is owned, which is recorded on the blockchain, investors can then choose to keep it as is or develop it through programming. Accordingly, there are now “meta architects” who can build you a virtual house, dance club, casino or whatever you dream of. If you’re feeling crafty, you can even do it yourself.
Metaverse land is still in its infancy, meaning parcels of land can go for less than US$10,000. Interest has been building quickly though – total transactions of virtual land reached US$501m in 2021 across the four leading metaverse platforms. Notable entities that are now metaverse land owners include JP Morgan, Adidas, Samsung, rapper Snoop Dogg and the country of Barbados.
Do you think investment in digital real estate is a good idea? Some certainly do, as the plot of land next to Snoop Dogg’s virtual estate sold for a jaw-dropping US$450,000 last year. It’s probably the most affordable alternative if you really want to be neighbours with a global celebrity.