It is 2035.
The Metaverse has become the front-end of the Internet, the interface for communicating
with the smart contracts, AI and robots that have automated much of our
lives.
The people of the world have taken back their data and digital rights through the
decentralized web and DAOs, providing them leverage against the once monolithic
corporations whose closed platforms have crumbled to dust.
People can live their digital lives in anonymity, or they can use their newfound leverage
to sell their data to the once powerful “big tech” companies, providing a universal
basic income for billions across the globe.
Metaverse entrepreneurs and real-estate moguls drive a now crucial part of the global
economy. Those that saw the opportunity in its infancy made big bets and now generate
massive revenue streams through their rental properties and profit-sharing. Those that
did not take advantage have become second-class citizens in the Metaverse, at the mercy
of ever-increasing rents for the land their Web3 businesses occupy.
Decentralization and the blockchain have changed much. However fortune as always, still
favors the bold..
Virtual land investing in the Metaverse is a hot topic these days, with land plots in
coveted locations going for hundreds of thousands (even millions) of dollars and bringing
massive returns to early speculators. Someone even paid $450,000 to be Snoop Dogg’s neighbor
in The Sandbox, a popular Metaverse [1].
Although virtual real estate sales have only really entered the popular consciousness in the
last 6–9 months, it dates back many years to games like Second Life, and has been growing
since. In 2021 real estate sales in the Metaverse reached $500 million, and are projected to
double in 2022 [2].
If you’ve been interested in taking the plunge and investing but don’t know where to
start, we’ve got you covered. Although this new type of investment may seem
complicated and difficult to purchase, it’s actually much easier than you think. We’ll go
over the types of land, how to think about and approach virtual land investing, and how to
actually go through the process of purchasing the land itself.. and profiting!
Like with any investment, there are risks to investing in virtual land, and your
investments could go to zero. Invest wisely and know your tolerance for risk. Nothing in
this article constitutes financial advice.
Just like in the real world there are options when purchasing real estate — in the Metaverse, this primarily comes down to undeveloped and developed land:
Generally speaking, developed land is worth more. “Location! Location! Location!” is another variable that affects desirability and price, but as the Metaverse evolves and new features such as teleporters and bookmarked fast travel are introduced, this will become less important. Judge the value of plots which are priced based on location accordingly if you are looking to hold long-term.
The practices that venture capitalists follow when investing in early-stage private companies are applicable to the current investing environment in virtual land (and with NFTs in general):
And just like with any publicly traded investment, volatility, impact of the overall health of the economy and “Buy low, sell high” still applies to land NFTs!
Look Ahead — Look for the potential for new revenue streams and future fit as the
Metaverse matures. Revenue streams and utility is where things really get interesting. Think
about what brands and users are going to want and need. The space is moving fast!
Regulation — One of the things that attracts people to the blockchain is anonymity.
However an investment which is considered a security by the SEC requires compliance with
customer identification laws around KYC (Know Your Customer) and AML (Anti-Money
Laundering). The current status of token regulation and precedents so far goes way beyond
the scope of this article, but by focusing on investments with utility you lessen the chance
of your holdings being marked as securities. [3]
Diversify to Mitigate Hacks — Another consideration for diversifying is the danger of
hacks and stolen investments. With new technologies there will always be loopholes and
exploits in the early-going, and teams trying to rush product to capitalize on FOMO while
slacking off on security and proper protocols only makes the situation worse. Just recently,
one of the biggest play-to-earn Web3 games Axie Infinity was hacked for an eye-watering $625
million. [4]
Double Down With Tokens — If you’ve bought land in a project you really believe in,
you can continue to support it while also diversifying your holdings by investing in its
native token (for example CasinoEmpire’s CASI or The Sandbox’s SAND). These tokens enable
Metaverse economies to run and a strong token is key in rising virtual land values.
SAND Token’s price over the last 12 months
Niche Down — While there is appeal to worlds like The Sandbox that offer “everything to everyone,” there is a less talked-about but huge opportunity in virtual worlds that focus on popular markets and game genres that have traditionally strong monetization. For example CasinoEmpire.io is a virtual Las Vegas in which you can beat the house or BE the house!
Follow LuckyLadyGames CEO Sandra Wong on Twitter
Now that you know about the different options for investing, let’s talk about the steps you
need to take in order to pull the trigger and get the NFT representing the land in your
crypto wallet (steps will differ depending on network and Metaverse platform).
As with any investment, due diligence is a must; our recommendations are below.
The marketplace for land plots in Decentraland
By thinking about what you want out of your investment, learning about the space and doing
due diligence, you can derisk your investments by avoiding purely speculative plays and rug
pulls.
The Web3 landscape is fragmented, creating a barrier to entry for would-be new enthusiasts.
However it’s still easier to get a handle on than you think, and this fragmentation is
typical with new markets and technologies. We’ll likely start to see consolidation and
standards arise more and more rapidly as behemoths like Animoca and innovators like
Immutable X continue to grow. This means more investors and rising prices as it gets easier
and easier to invest, rewarding those who take the time to learn and get in early.
We’ve covered a lot in this primer, congratulations for making it this far!
We hope you can now see that not only is the world of Metaverse land investing not so complicated, but that it is full of possibilities that we are not even beginning to scratch the surface of:
We believe the Metaverse and a decentralized future is inevitable — if you don’t take part
early by buying land and setting up revenue streams, you’ll be renting!
Want to stake your claim to land in CasinoEmpire? Learn more about the project and join our Discord for updates!
You can find this article on Medium and other articles like this.