BAYC Land Sale Tops $285M, Are Metaverse Lands the Next Big Thing?
Metaverse, as you may know, is a 3D virtual environment where users may own, develop, and sell digital goods. The virtual world, like the actual world, is made up of bits of land. These lands are represented as NFTs on the blockchain, giving the holder entire ownership.
Each Metaverse is made up of a finite number of land packets/plots with specified dimensions. The Decentraland Metaverse, for example, is made up of 90,601 (16m x 16m) land pieces. The Sandbox Metaverse, on the other hand, is made up of 166,464 (96 × 96) pieces of land. Users may develop their land by filling it with digital items in order to produce value. The digital assets might be buildings, automobiles, games, or any kind of 3D object.
Metaverse lands are the most profitable investment opportunity in the Metaverse ecosystem. It is a strategic asset whose value is predicted to rise over time. People may buy the land and then sell or rent it to other people.
Recently, Bored Ape Yacht Club (BAYC) launched its virtual lands called Otherside which appear to be a multi-land metaverse. There seems to be a lava landscape, an ice landscape, a crystal landscape, a sand scene, a purple mystic landscape, and a unique earth-like landscape.
Yuga Labs partnered with Animoca Brands to build the Otherside metaverse which generated roughly $285 million in digital land sales and created some of the highest gas fees in the Ethereum network’s history – costing investors over $176 million.
We spoke to some industry leaders about how they feel about this new digital land wave, and here’s what they have to say.
Mykolas Karpičius, CEO & Founder – Cannumo
“Metaverse is the next logical evolutionary step in crypto technology. Even Facebook, after the heinous Cambridge Analytica scandal, has hired over 10,000 people to develop their very own metaverse and has rebranded itself as Meta. Thus, the decentralization issue becomes even more prevalent because of the rising concerns of someone controlling every piece of personal data, not only personal finances, one has available. Every facet of the blockchain comes together within a specific metaverse – NFTs, gaming, Web3, decentralized financing, and social media. What is not to like or bet on to grow in importance in the near future?”
Philip Rosedale, Founder – Second Life
“The value of the virtual real estate, which is not zero in the long term, is certainly hyped and inflated right now by this frenzy of interest that is perhaps out in front of what the technology can actually deliver.
We have to cross a really big chasm, and that chasm is from what young kids are doing and willing to do in multiplayer games to grownups wanting to be together socially in a virtual environment. And we’re a lot farther from that than a lot of the enthusiastic folks in the market think right now.”
Dylan Dewdney, Founder – NFT3 & Co-founder – Kylin Network
“I think what we are witnessing, whether or not this sort of trend continues unabated, is the result of years of global, pent-up demand by individuals to have a new, fairer, and decentralized internet, of which metaverses are but one component. Virtual land is tantamount to real land; we are trying to re-make an image of the real world on top of fairer and more equitable technical rails. As a proviso, we will need to solve the barrier of entry issues endemic to Ethereum sequentiality and gas fees, but these issues will inevitably be solved.”
Janine Yorio, Co-founder, & CEO – Republic Realm
“The only way the metaverse becomes interesting is if there are things to do and people to see and places to go when you get there. We bought a city, a 24 x 24 parcel, with each parcel the equivalent of 100 meters. We paid so much for it because we want to do something big, something very immersive. We want to buy land and build things on it. Republic Realm’s projects include Fantasy Island, a luxury real estate development in The Sandbox. We plan to work with Atari on game development for its blockbuster deal.”
Edwardo Jackson, Founder & CEO – CinemaDraft
“Inexplicably, it appears that metaverse real estate ARE the next big thing. However, I remain skeptical overall of the current state of play when it comes to the utility and utilization of NFTs.
Conceptually, NFTs do have tremendous future untapped value for use cases involving identity, ownership, ticketing, membership, real estate, etc. Unfortunately, what grabs headlines in the infancy of their popularity are big, splashy sales of subjectively valued artwork and virtual real estate in the underdeveloped space of the metaverse.
While I think the metaverse EVENTUALLY will have value, I believe we are at least a decade away from anything that makes sense at scale. A READY PLAYER ONE – style vision of the future would have tremendous value. However, the technology and social buy-in needed to populate such a rich, interactive, and popular future feels at least a decade off from mass adoption. Anyone buying land in the metaverse now better have a long-term appetite for risk as I do not see tangible value from actual utility coming from the metaverse until such adoption of technology and society has taken place.
Would I buy Bored Apes Yacht Club metaverse land today? No. If I were a billionaire with a true belief in the long-term future of the metaverse and patience of a two-to-three decade time horizon for a significant return? MAYBE.”
Lorne Sugarman, CEO – Metaverse Group
“Land in the real world tends to appreciate because it is limited. In the metaverse, it is a similar principle. We are early on the potential multi-trillion-dollar metaverse market. Metaverse Group last month made a $2.43 million purchase of parcels in Decentraland.
Land in The Sandbox is scarce, with a supply of 166,464 parcels available. Each basic unit comprises 96 x 96 meters. Decentraland, which is run by a decentralized autonomous organization, has 90,601 parcels, but just about 44,000 parcels are allocated for private purchases and sales.
Because Decentraland is a DAO or a community, if they were ever going to release new land, they would have to get all the currency holders, as well as all the landholders, to vote that they had agreed to that. The community isn’t going to want us to harm our value and our land and currency so I don’t believe that’s something that would happen. But if that were going to happen, it would have to be for a very good reason.”
Sebastien Borget, Co-founder & COO – The Sandbox
“The utility of virtual land is real. The three other major platforms in meta real estate include Decentraland, Somnium Space, and Cryptovoxels, together they own nearly 269,000 parcels of digital real estate. The possibilities are tremendous because there are no more limits to physics, to the imagination, and it makes sense because users want to engage more profoundly with the brand community.
Many companies are using the virtual land to create new marketing channels through immersive experiences, digital goods like NFTs, and sponsored content. Brands will want to be closest to where the users are to keep engaging with them.”
Andrew Kiguel, CEO – Tokens.com
“The metaverse is the next iteration of social media. You can go to a carnival, you can go to a music concert, you can go to a museum. We recently dropped nearly $2.5 million on a patch of land in Decentraland — one of several popular metaverse worlds. Digital real estate prices have gone up 400% to 500% in the last few months. Just like property in the real world, the metaverse is about three things: location, location, location. There are areas when you first go into the metaverse where people congregate — those areas would certainly be a lot more valuable than the areas that don’t have any events going on.”