WrapPRO Special Series: Companies such as Planet Hollywood, Sothebys, and even J.P. Morgan have been buying up virtual land on Web3. Is this a sound investment or not? Are they building in an area where there is a lot of landslide?
Nevertheless, a slew of companies, from entertainment conglomerates to banking behemoths, as well as early adopting individuals, are scooping up virtual territory in the metaverse — also known as Web3 — as this new immersive version of the internet slowly starts to take shape (see our previous guide to the metaverse).
Planet Hollywood is creating a virtual Hollywood where users, according to its press release, will be treated like royalty. “first-of-its-kind backlot experience.”Sothebys is creating virtual galleries and museums that house digital art from the NFT collection.They were put up for auction last year.). Bud Light will build a virtual clubhouse to host Super Bowl parties; HSBC has announced that it would develop a stadium for virtual sporting events. Warner Music Group also announced this. Plans to open a concert venue of its own to host virtual events, along the lines of Travis Scott and Ariana Grande’s concerts on the popular 2D VR game Fortnite.
J.P. Morgan is also getting in on it, creating a virtual “lounge”It could be used as a virtual banking institution. “In time,”J.P. Morgan observed in its Report on meta, “the virtual real estate market could start seeing services much like in the physical world, including credit, mortgages and rental agreements.”
Because these companies own the land, they have the freedom to build whatever they wish on it. There are no limits to what you can do with this land.
Right now, real estate purchases in the metaverse involve four major Web3 platforms — Sandbox, Decentraland, Cryptovoxels and Somnium — which have together already racked up $501 million in 2021, with sales projected to double to$1 billionAccording to MetaMetric Solutions, this is the highest number of sales in a single year. There are a dozen other platform-building companies that are forming, which could add tens to millions to these sales figures.
For now, the big four platforms are offering some 200,000 parcels — as real estate units are referred to in the metaverse — with prices ranging from $3,100 to $11 trillion on The high endDepending on which platform you use, “location”and the grit of the seller. In order to preserve their value, these parcels will only be made available in limited numbers. The largest platform is Decentraland. It offers approximately 90,600 parcels. But, of course, since it’s all ones and zeroes anyway, there’s theoretically no limit to how much land could ultimately end up for sale in the metaverse.
And, by the way, you don’t have to be a media or banking conglomerate to buy those parcels. Anyone who wishes to participate in the land grab and begin homesteading in metaverse can either purchase property through a broker (yes they exist), get a metaverse mortgage through Terra Zero, or directly from a platform. Transactions are made using cryptocurrency such as Etherium and are recorded by Blockchain technology.
It will be more difficult to visit the land. It’ll require a VR headset, at least if you want to experience metaverse property ownership in its full, 3D immersive glory.
“You can use a house in the metaverse to host virtual parties with your friends,”Erin Sykes is a Nest Seekers International agent who brokers metaverse property sales. “Or build your dream home and simulate how it functions prior to investing in a real-property project.”
Rob Dixon, a science fiction author who discovered the metaverse while researching his story, is a new entrant to the virtual world. He owns eight parcels of Decentraland land and runs his own business. Your own amusement parkThis attraction lets you ride a digital Dragon. “I am convinced of the potential [of the metaverse]. It’s definitely there,”According to him, the Los Angeles Business Journal. “But we are definitely in the early days.”
So early that Disney hasn’t yet announced any plans to build its own amusement parks in the metaverse — a much-speculated about possibility for the future. The media giant is still only trying to get its feet in the virtual water. vague noises about developing “next-generation storytelling”Web3. Like a lot of companies, Disney presumably doesn’t want to be left out of the metaverse land rush, even if it doesn’t yet have any clearly articulated plan for what it might do in the space.
“It’s going to take all the great things that we as a media company have… and use that as a platform for the metaverse,”This is what Bob Chapek, Disney’s CEO, could have come up during an interview Interview with CNBC. “But at the same time, we have something that no one else has, and that’s the physical world, a world of our parks. And so, if the metaverse is the blending of the physical and the digital in one environment, who can do it better than Disney?”
Individual digital entrepreneurs could make smart capital investments in real estate in the metaverse. “Investors hope to profit by advertising on their land, renting it out, or by flipping it to another buyer when the value has increased,”Baruch Labunksi (CEO of the IT firm Rank Secure) noted this.
Don’t have enough crypto for a parcel to call your own? Rent is always an option. Metaverse Properties, an estate group, is offering land lots along with homes and commercial spaces on various platforms (“waterfront”You will be charged an additional fee for certain locations. Decentraland has a group called The Tokens TowerIt is renting space in its virtual building. It is conveniently located in Crypto Valley. This district is one of the most bustling and well-built-up on the platform. It’s being pitched as the perfect virtual space for tech startups and venture capitalists to get in on the ground floor of the metaverse boom.
But beware: Renting on somebody else’s land could turn out to be risky. “One potential issue that could come up is if they pull digital real estate out from [renters] and work with another program,”Travis Cloyd, an Arizona State University professor at Thunderbird School of Global Management, noted this. “In that situation, we don’t have the governance and policy in place”Protect renters. At this stage in the game, he said that buying is the smartest move. “I predict the prices will rise and virtual worlds will expand beyond the imagination.”
He’s hardly the only one bullish on metaverse real estate. “People’s lives are more invested in their digital identities than ever before and the value of virtual real estate appreciation can make it a worthwhile investment, especially for organizations looking to capitalize on the advantages of being an early adopter,”Scott Absher is the CEO of ShiftPixy’s jobs platform.
Brajesh Jaha, the global head for media, publishing and entertainment at Genpact, a technology consulting firm, has been added. “When more and more people with headgear want to get teleported, the surrounding spaces are likely to rise in value. Investors with foresight would move in early and turn the assets into investment properties.”
Still, don’t expect a quick turnover. Most experts say it’ll be at least a couple of years before homes in the metaverse will be move-in ready. Living in the virtual world is likely to be lonely for now.
“Buying land in the metaverse today is like buying land two hours outside of a booming metropolis,” said Quynh Mai, founder of the tech marketing agency Moving Image & Content. “Brands hope that people will move there, but right now it’s just empty fields and an occasional visitor.”
Brian Welk was a contributor to this report.
This is Part 4 in a WrapPRO Special Series: The Metaverse UnWrapped.
Monday: How to Lose a Billion Dollars in the Metaverse and Other Mysteries of Web3
Tuesday: Why Film Producers Are So Excited About the Metaverse: ‘Everybody’s Dream Can Come True’
Wednesday: Why VFX Companies Want To Create Your Metaverse-Realized Avatar
Thursday: The Next Real Estate Boom: It’s in the Metaverse