Metaverse Property cost: Increasing demand and emerging opportunities!

Metaverse Property cost: Increasing demand and emerging opportunities!

Samsung has purchased a land parcel in Metaverse – Decentraland!. Financial institution – JP Morgan bank has opened a lounge in Metaverse- Decentraland. PWC has purchased a property in the metaverse (Sandbox).    Top brands Hyundai, Nike, GUUCI, Louis Vuitton, Coca-Cola, and many other apparel shops/sportswear shops are increasingly investing in Metaverse virtual lands. The Metaverse property cost is increasing!

The metaverse property market reached $ 500 Mn in 2021. Metaverse market size is expected to reach $800 Billion in 2024 and is estimated to impact $ 8.3 Trillion of business. In 2021, people have spent about $54 Billion on virtual goods alone, such as games, NFT, etc., !!

For people who have invested $1000 in metaverse lands, the value has appreciated to $13,000 in a couple of years! The metaverse property cost continues to spiral upwards. Despite costs going up, people are investing in metaverse properties.

Metaverse Land Price: Why Metaverse land prices are increasing in a virtual world?

Virtual Land

Ideally in a virtual world, there should not be any scarcity in the digital world, but still, metaverse property costs are going up. Some companies have created digital lands. These digital lands are digital platforms. People can build museums, exhibitions, game centers, shopping malls, concert places, etc., These platforms provide the features to build a virtual world. However, the characteristics of real estate in real and virtual real estate are very similar!

Some of the pioneers who have created digital platforms and sold digital lands are:

Decentraland: Built the first city with 90,000 parcels of land. The cryptocurrency of Decentraland is MANA. The price of one of the plots traded is 2.43 million dollars!

Sandbox: 166,464 parcels of land in Total.

Axie Infinity: 90,601 parcels of land in total.  $3.6 Bn worth of trading. The most expensive Axie traded is $820,000.

Crypto Voxel:  Has about 7351 parcels of land.

Somnium Space:  has about 5026 parcels of land.

Some more players have developed metaverse platforms similar to the above. All these platforms have similar functionality, but these companies own a part of their lands, to create their games, shopping malls, concert places, etc., which helps to allure the users to come to their platform and enjoy the various events, games, and shop, etc., This is like having common amenities in a

For example, Axie infinity focuses on developing battle games and has features that will help to play the battle games and allow the developers to develop various games using their platform. This helps the game developers to monetize their games.

Key drivers for owning metaverse property :

• An enriching experience for users: The virtual platform provides new experiences that cannot be accomplished in the real world. For example, purchasing land in the real world at the desired place for the desired price might be difficult for a user, but purchasing digital land may be possible in the desired place.  In the digital land, the user may build their ambitious house, mall, etc.,
• Unleashing the creativity: Some people have very intuitive ideas which cannot be built in the real world, the platforms provide immense opportunities for new models, avatars, games, malls, arts, etc.,
• Monetizing opportunities:
  • The digital assets – arts, malls, and games are getting monetized in many ways.
  • Connecting real-world businesses like banks, e-commerce, etc., which helps to increase the revenue, and provide new experiences
  • Creating a new marketplace – A marketplace with NFT.
• Limited Lands: The number of lands is very limited in each of the platforms, the reason being the underlying concept is that these platforms and digital assets are built using blockchains that cannot be fudged for any reason. Hence the number of lands in digital lands remains the same.

Metaverse investment opportunities: Who is investing?

• Ecommerce: The e-commerce giants – Alibaba, Amazon, Walmart, etc.,
• Fashion companies: Nike in collaboration with Roblox, has built its land Nike Land. Other companies such as Louis Vuitton, Gucci, Zara, and Adidas, have virtual shops in the metaverse.
• Entertainment companies: Disney & Netflix are already making moves – as they understand that Metaverse is not only 3D games, it is also about entertainment and more. Following these giants, there are many entertainments are venturing.
• Electronics companies: Samsung has also invested about $25Mn in a south Korean metaverse start-up,
• Chip manufacturers like NVIDIA’s Omniverse: The largest NVIDIA semiconductor chip manufacturer is investing heavily in developing high-powered GPU (Graphics processing units) and developing Omniverse – a collaborative 3D platform that helps to create 3D models & collaborate with people, apps, and systems more easily. NVIDIA is also heavily investing in Artificial intelligence.

Where can I buy metaverse land?

Through Metaverse companies – The users can buy land directly from the metaverse property developers like Decentraland, Sandbox, Axie Infinity, Crypto Voxels, etc., this is just like purchasing from real estate promoters in the real world. These promoters also hold some part of the land to develop common amenities and also keep certain parts for the promoters.

Through Third-party real estate agents or marketplace: Some of the leading companies in this space are opensea.io, nonfungible.com, and rarible.com – these are NFT marketplace, these companies have also invested in the metaverse properties and these companies resell the properties.  Some of the prime locations in metaverse property are owned by resellers as in the real world and sold for higher prices!

How to buy virtual real estate in Metaverse? / How to buy land in Metaverse?

The process of buying metaverse land is similar to digital online payments.

• A digital wallet is required –  There are digital wallets such as MetaMask, Binance Chain wallet, etc.,
• Buy a cryptocurrency – Like in any currency exchange in the real world, cryptocurrencies can be purchased in digital exchanges like Coinbase, KuCoin, etc., The metaverse is a digital platform and each platform is like a country with its cryptocurrencies. For example, Decentraland uses MANA as the currency, Sandbox uses SAND as the native currency.
• Go to the chosen metaverse and buy land using the cryptocurrency.
• Once the land is purchased, the NFT is deposited in the user’s wallet. Every land or digital asset is an NFT.

Metaverse value chain: The increasing value chain of Metaverse

• Dreams come true:
  • Creation: This is the world of creators and users who would like to create that are very different and imaginative. The possibilities of the design of the auditorium are almost limitless in virtual land, as the constraints are much lesser in virtual land.
• Experience that excites:
  • This is a world of fantasy.  The user can gain experiences such as participating in a music concert, experiencing the newly launched car, and shopping at world-class fashion shops!
  • Owning a dream resort by the side of the river! which might not be possible for someone in the real world!
• Collaboration at its best – Blend of Virtual and Real-world
  • Banking lounge – The banking services can be availed remotely with an exciting in-place experience.
  • eCommerce – Try the fashion apparels that best suits us and ship the real apparel based on the trials
  • Hybrid workplace – Meeting from various countries that need to happen on an urgent basis, can happen at the earliest possible time
• Solving real-world problems
  • Creating digital twins – Troubleshooting a problem in machinery or setup or doing some installation and reflecting them in the real world.
  • Many such examples are possible.
• Greater economy
  • A new digital economy is created which is very different, that Is fully authenticated, with no frauds! safe economy, already many players have invested and new kind of demand in terms of real estate, eCommerce, supply chain, banking, etc have opened up, which is driving a new digital economy. This is going to be a world of imagination, fun, instantaneous, exciting, and risky!

Components of Metaverse:

• Infrastructure – This is a high-end computing platform – which requires high computing resources, 5G technology, and so on. this is not only going to consume high computing resources; this will also drive digital technologies to the new frontier.
• Human Interface – Mobile, AR glasses, VR glasses, etc., Still the VR and AR glasses are heavier to use and not fit for long hours of usage – this is another area where many companies like Meta, SONY, Google, and Game developers are investing to develop more user-friendly devices.
• Natural language processing – The world is open for anyone to collaborate from anywhere, and NLP plays an important role in communication. Advancements in this area further break the communication barrier.
• Decentralization – Since the base technology is Block Chain,  It enables decentralization and is tamper-proof! hence the creators and users can create, commerce, and experience with their digital assets and with their own safe identities.
• Blockchain – the underlying pillar of the metaverse is Block Chain technology. Blockchain helps in creating these assets as NFT – nonfungible tokens. Not only for digital assets but also cryptocurrency – the underlying technology is blockchain. Blockchain is the foundation of the metaverse to maintain authentication, security, ownership, etc.,
• Artificial Intelligence: AI plays a significant role in workflow automation. Automation using AI is creating new kinds of business opportunities.
• Internet of Things – Digital Twin and data transfer between the physical and virtual world will be on the rise, to solve some of the real-world problems remotely.
• Social Media – Social collaboration is one of the key aspects of Metaverse, and effective engagement between the social users is key to enabling traffic in Metaverse.

Metaverse Technologies: The two underlying technologies – Blockchain and Cryptocurrency

• Blockchain: In the era of the Internet of everything, some of the challenges are hacking of personal information, muting the information, and speed to complete the transactions! Blockchain prevents the security of immutability and prevents hacking. In a virtual world, the data is more vulnerable to hacking. Having a blockchain platform prevents hacking of the data. Immutability helps to prevent tampering with ownership.
• Metaverse Crypto: In the virtual world, all are digital assets, owned by someone.  The mechanism used is NFT (Non-Fungible tokens) for digital ownership. Again, NFT is blockchain technology.  Cryptocurrencies are for trading digital assets. In some cases, NFT is directly for trading.

Metaverse Business Opportunities:  

• For Technology / Service companies: The underlying technology and components give a plethora of opportunities. Web 3.0 – Semantics web, Blockchain, cryptocurrencies, 3D Models, VR, AR, AI, NLP, etc., are some of the technologies. Customers would like to build their shops, concepts, employee engagement, fan engagement, and social engagement, e-commerce kind of applications. Application development using this kind of technology platform is one area there could be many opportunities that will are opening up.
• Game / App developers: For game developers, this is a natural extension of what they have already been doing! However, deploying games in a different marketplace creates new kinds of opportunities.
• Real estate owners: Similar to the Real estate in the real world, real estate owners are investing to create dream real estates and sell/rent real estate properties. Metaverse companies are attracting these investors by offering various features, common amenities, tools, etc., As the real estate investment increases, this opens up opportunities for design companies, marketers, advertisers, and real estate agents.
• Marketing / Events / Promotion companies: Attract the people through promotions/ads as in the real world!
• Retailers: Connecting the virtual world and real-world and strive to increase the customer base by not only connecting but also.

Metaverse real estate investing: The risks involved!

The metaverse world is still evolving and looks lucrative and looks like the future of the internet. However, it has risks.

• The metaverse properties are still evolving, currently, the number of popular virtual real estate is less in number, hence the number of prime locations is also less and the demand is also on the rise. As new platforms get developed, the number of new plots will also increase.  The demand will go down! the probability of the prices going down is high!
• Cryptocurrencies and virtual lands are not regulated by governments. New regulations may come into place!
• One of the unique features is social identity, smart agents may try to capture the social identity in the virtual and misuse it in the real world.
• Many companies are in the trial phase, and this technology takes time to evolve.

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