Metaverse is red hot right now. Everyone wants a piece and the best pieces are NFT virtual land parcels. These plots of virtual land allow one to have a really visible presence in the virtual world. Virtual galleries, museums, and online casinos are all popping up.
Events, hanging out, working, and much more can be facilitated through these virtual lands.
Of course, there are those who are buying and selling and (hopefully) profiting. Many big brands and companies have also shown interest in becoming owners of NFT lands.
What is it all about and how can you get in on the action? Read on to find out.
What is Metaverse?
The Metaverse is described primarily as a virtual 3D space that is online and persistent. Users log into these spaces where they can meet, play games, attend events, work, or just hang out while looking around. Metaverse is also strongly connected to the blockchain, NFTs, and other high-tech like virtual and augmented reality.
The best way to think about Metaverse isn’t as a single place, however. There is no “TheMetaverse.com” that you can log onto.
Instead, as it is now, Metaverse is more of an idea than any concrete thing or place. There are plenty of platforms and projects that are considered a part of this idea. Some are run by “Big Tech” such as Meta’s (formerly Facebook) Horizon Worlds and Workrooms, some are actually videogames such as Fortnite. And some are run by developers in the blockchain scene – Decentraland, Cryptovoxels, and The Sandbox are examples of those.
In broader terms, Metaverse is part of the Web3 vision for the future of the Internet which promises a more decentralized and democratic internet in which users own their digital content.
NFTs and NFT digital land are key parts of this too.
What is NFT Virtual Land?
Virtual land in Metaverse is a lot like actual real-estate in the real world. It’s a part of the digital space in a Metaverse application that you can own, use in various ways, as well as sell on NFT marketplaces.
Like most of things that you can buy and sell in the Metaverse, these virtual land plots are non-fungible tokens or NFTs. This means that the land you bought is uniquely yours and uniquely identifiable.
This is achieved through NFT technology, which is one of the key things powering Metaverse. Through this token, it’s possible to prove that a certain digital asset belongs to a specific person.
Essentially, when you purchase a specific plot or a set of plots with certain coordinates in the Metaverse space, they are only yours.
There are many different projects that utilize the NFT land concept and there is plenty of virtual land in Metaverse. Some of the most popular projects are Decentraland, Cryptovoxels, and The Sandbox.
Whatever implementation of Metaverse it is, NFT land has some common traits: it is scarce, each plot is unique, has an owner, and owners can choose how to use them within the Terms of Service and the technological possibilities of the project in question.
The ability to buy NFT land in Metaverse is part of the Web3 idea, where the virtual worlds and spaces are built by the actual community. Also, because the plots and the 3D buildings sitting on them (that users have built) are unique, this brings a true-to-life flavor to Metaverse.
Just like how a real-world city is a collection of different buildings and experiences, a Metaverse space also is the result of what people do in it. This is exactly what the proponents of Web3 want. Virtual 3D spaces that feel alive and unique in stark contrast to the homogenized spaces represented by social networks and Web2 sites.
Possible Uses of Virtual Land in Metaverse
As previously mentioned, the uses of NFT land in Metaverse are almost unlimited. Obviously, there will be certain community standards and you will also be limited to what is technologically possible within the 3D engine and building tools that the Metaverse world uses.
Outside of that, the sky is the limit.
Of course, how the land will be used also depends on what the Metaverse world is like. In Axie Infinity, a popular play to earn NFT game, land provides extra resources, crafting ingredients, and similar boosts to help the player win.
In Decentraland and Cryptovoxels, land lets owners put up buildings and then use them for various virtual experiences.
One of the uses is just to socialize. You’d invite your friends to your cool new apartment so why not invite them to your cool new digital house? All the Metaverse functions are available, of course, such as talking to people, playing games, and so on.
A popular use of NFT land is to hold various events. In Decentraland many virtual nightclubs and galleries have popped up. These spaces are used to hold virtual parties, often featuring live DJs. Oftentimes, there are exhibitions of NFT art which are displayed on the walls of the virtual building.
It’s essentially the same as a real-world gallery. Visitors can walk around and choose to purchase the art pieces that strike their fancy.
If the plot turns out to be popular (maybe the virtual DJ sets are particularly lit) then owners can also stand to benefit from selling advertising space or even engaging in event sponsorships.
In short, the advertising possibilities work pretty much like they do in the real world. If a lot of people come to a place your own, then your place has value in terms of displaying ads for various products and services.
And of course, as with anything else that’s valuable, there is speculation. According to reports, the virtual land market in the “big four” Metaverses (Decentraland, Somnium Space, Cryptovoxels, and the Sandbox) reached €440 million in 2021.
So, there is clearly a lot of interest in these NFT lands. And this has attracted the virtual version of a real-estate investor. People who purchase these land plots with the idea of holding on to them and profiting from price increases as demand rises.
How is Price of Virtual Land Determined?
The price of NFT virtual land is determined just like the price of any asset on the market. Through the meeting of supply and demand.
Of course, the three Ls of real-estate apply as well: location, location, location.
The more attractive the location is within a metaverse, the more it will cost for you to buy a land plot.
There are two main ways to buy land in Metaverse: through an initial land offering (ILO) and on the open market.
In an ILO, the developers of a project offer the option to purchase plots directly through an auction. This typically happens before or very soon after the project goes live. Early birds can snag NFT land in this way before others.
The price can form during an ILO in various ways, based on location, expected future value and so on. In the end, users choose whether or not to purchase the plots at the initial price. If the demand outstrips demand, and it often does, then the plot of land will go to the highest bidder.
Some ILOs did not have a set price-point, instead relying completely on incoming bids to form the price of land.
Metaverses can also have regular plot auctions. Cryptovoxels has taken this approach with regular auctions of newly minted plot happening.
Since virtual land in Metaverse is scarce, that is to say a limited number of NFTs will be minted, the price behaves almost as the same as in the real world.
It is possible to bid on existing plots, and it is also possible to buy the content that other users have built on the plot. This way entire experiences in Metaverse can change hands.
Global Brands and Companies Buying Metaverse Land
As with anything that is making waves online, big global brands and companies are showing interest in NFT virtual land.
Famous rapper Snoop Dogg has created a Metaverse experience in the Sandbox. Adidas has also purchased space on the platform for their AdiVerse project.
Gaming company Atari owns virtual property both in The Sandbox and in Decentraland. The Decentraland one is home to the Atari Casino where the brand plans to develop a Metaverse online casino featuring slots, blackjack, and other gambling entertainment.
Samsung, the Korean tech giant, launched its own Metaverse location, again in Decentraland. It’s based on the Samsung 837 store in New York City where products can be directly experienced and it offers NFTs, games, product info, and live performances.
The company has also hosted a digital version of the unveiling of their Samsung S22 phone on its NFT land plot in Metaverse.
It’s not just tech and entertainment companies that are interested in Metaverse. The Hong Kong branch of PricewaterhouseCoopers (PwC), one of the “big four” audit companies, has purchased land in The Sandbox.
Prager Metis, another accounting firm, bought land in Decentraland. So has Miller Lite, the American alcohol maker. The Meta Lite Bar was launched just in time for the Super Bowl.
In short, many different companies are buying NFT land and for many different reasons. While most are doing it for promotion, some are actually seeing Metaverse as the future of work.
During the Covid pandemic, Neustreet, a data start-up, built a digital headquarters in Cryptovoxels that cost them a bit over $13,000 (or 5.75 Ethers).
How and Where Can You Buy Land in Metaverse?
Buying land in the Metaverse works more or less the same as buying any other NFT. We already mentioned ILOs, so a good way to buy land is through an initial land offering.
Some metaverses such as Cryptovoxels have regular land auctions as plots are minted. In other metaverses, plots can be purchased either through a marketplace or through NFT trading platforms such as OpenSea.
The four biggest and hottest Metaverses right now are Decentraland, Cryptovoxels, The Sandbox, and Somnium Space.
Land in all these four can be bought and sold on the OpenSea NFT trading platform.
If you have ever purchased an NFT before, you already know how to buy land. If not, you will need a cryptocurrency wallet and some cryptocurrency to put in that wallet. Things on OpenSea are typically purchased in Ether but sometimes Wrapped Ether (WETH) is used too and in the case of Decentraland many plots are listed in its native MANA token.
Most NFT land is bought and sold on the Ethereum network but some can also be found on Polygon.
In brief, the process of getting NFT land in a Metaverse application will depend on how things work on that platform. If, like Cryptovoxels there are regular auctions of newly minted plots, you will want to wait for those to get them at what will almost definitely be a lower price than when they hit the open market.
Note that this isn’t possible for Decentraland anymore. All the parcels have been purchased by the end of 2018, and now the only way to get your own land is to buy it off someone else.
For some Metaverses, you will also need to get their specific token, while for some you will just use Ether.
The best place to get informed about the specifics is in the documentation of the Metaverse you want to buy the land in.
What You Should Do and Know Before Buying Metaverse Land
What you need to do and know about buying NFT land in Metaverse depends on what you want to do with it.
Are you buying these parcels to use them or are you buying them to trade and hold as a speculative asset?
If you want to actually build something in Metaverse, there are a lot of things to look at. What are technical specs of the Metaverse and what can you actually build there and what kind of experience can you offer? Again, the best place to get informed on this is the technical documentation.
As for trading, many of those same things will be important too. In order to try to predict what the market will be like; you will need to be familiar with the Metaverse app and what’s happening inside it. Look at the fundamentals of the project: popularity, number of users, the team behind it. This will give you an idea of the long-term viability of the project.
Looking at past transactions and price movements is a must.
And of course, like any digital asset and any investment, there is no real guarantee that whatever you buy will appreciate in value over time or even hold its current value. Like investing in stocks or cryptocurrency, it is absolutely possible to lose money and this is something you must be aware of. Don’t invest if you’re not willing and able to take the associated risks.
Furthermore, only buy land from reputable sources. There are scammers out there. Buying directly from the project from platforms such as OpenSea or Binance NFT Marketplace is a good idea. It’s not recommended to buy land by making direct transfers to someone’s wallet.
Some projects allow for land renting. If you only want to host a single event in Metaverse, it makes more sense to rent for a brief period than to buy.
For those who have never purchased NFTs before, remember that you will need an online cryptocurrency wallet such as Metamask or similar and a supply of the necessary tokens (Ether, MANA, etc.) which can be purchased on exchanges such as Kraken, Binance, and others.