What do you get when you merge virtual reality, augmented reality, and digital worlds? You get the metaverse, where you can be anything you like. For commercial real estate fans too busy enjoying free commercial real estate listings, the metaverse may not sound very interesting.
However, real money is pouring into the metaverse, which is quite interesting. Take Republic Realm, a digital assets company, dropping $4.3 million for land from Atari. Yes, that Atari.
What Is the Metaverse?
The metaverse is similar to the Internet in that it isn’t technically just one “thing”; rather, it’s a collection of things. In this case, the metaverse is a collection of virtual worlds full of digital assets that users of those worlds can interact with, trade, build with, and more.
Like the Internet, no one can really “own” the metaverse. Instead, you can use it for digital communication, virtual events, social connection, and digital asset allocation. You can also leverage it for digital marketing.
The term “meta” means self-referential: if you were to, say, place a cup inside of a cup, the cup that’s inside of the other cup would be considered “meta.” So why do we call it the “metaverse?” Simple: it’s another universe inside of ours.
Why Are Companies Going Deep on Metaverse Investment?
As you might imagine, companies aren’t flooding the market with real money just out of the goodness of their hearts. Indeed, companies are going where they feel the money will pay off in more significant returns, which is the heart of all investment activities.
Greyscale, a company running the world’s largest crypto fund, said that not only is the metaverse space worth $1 trillion in annual revenue, but this boom is just getting started.
So, where does that juicy trillion-dollar revenue estimate come from in the metaverse? It stems from multiple revenue-generating activities, including digital events, e-commerce, hardware, and, yes, advertising.
What Are NFTs?
In order to look at the rising demand within metaverse real estate, we have to define what that really means. Within the metaverse, what you’re buying is considered land, but it’s also an NFT.
You might have seen NFTs around the web, including those weird-looking apes that are now worth hundreds of thousands of dollars.
NFT stands for non-fungible token. Something that is non-fungible cannot be replicated, whereas something that is fungible can be. The US dollar bill, for example, is fungible, as you can have two of the same type of dollar bill that are both equal in value.
The best way to think of NFTs is to imagine them as uniquely collectible, a one-of-a-kind asset. In the case of metaverse real estate, NFT refers to a piece of virtual property that cannot be duplicated, and the ownership of that piece of virtual property can always be proven with a unique identifier since it’s a non-fungible asset.
Navigating the Metaverse
Let’s set aside NFTs and get back to the metaverse itself. Where is this metaverse land, anyway? It’s inside different metaverse games and worlds, such as Decentraland, Sandbox, Treeverse, Axie Infinity, and Upland.
Each metaverse has its own tokens that you use to buy the land-based NFTs, and those tokens all have different prices. For example, Decentraland uses the cryptocurrency token called MANA to purchase land parcels that represent real estate.
Smart Contracts in the Metaverse
It’s also important to realize that buying metaverse real estate isn’t just about owning virtual real estate, but it’s also about being able to make decisions because you now own a piece of metaverse land.
Using Decentraland’s metaverse as an example again, only participants who own MANA can vote on policy updates, auctions, and new developments.
While companies haven’t done much to control the metaverse through this type of participation, the door is wide open for them to take part in it. Could we see a platform like Decentraland become ripe for advertising to a wide range of people? Sure, why not?
What You Need to Purchase Metaverse Real Estate
If you want to get in on the action, you are going to need to get a few things. Normally, we would write this out in a simple checklist pattern, but each item needs a little more explanation. So this section will include not just what you need but why you need it.
You need to have an account on the metaverse platform you’re interested in the most. We recommend starting with one platform at a time because they all have a bit of a learning curve.
You can also join Discord communities focused on the metaverse platform of your choice, but that can have a Wild West-type feeling to it if you’re not familiar with Discord.
You need a crypto wallet that connects to the platform you’re interested in. We recommend MetaMask as the best cross-chain crypto wallet, even though it isn’t perfect. When you set it up, make sure that you are choosing a strong password that you don’t use on other sites.
You need this because not only does your wallet unlock the ability to buy metaverse real estate, but it also allows you to move the crypto out and convert it back into real-world money.
Ah, what would a purchase be without money to back it up? It’s important to ensure that you get the right cryptocurrency for what you want to purchase. In the Decentraland world, it’s all about MANA.
You can buy MANA on just about any cryptocurrency exchange, like Gemini and Coinbase. Every platform will have some fees to take your USD and turn it into MANA, but that’s par for the course.
Security Concerns in the Metaverse
If you’re buying things in the metaverse, you have to make sure that your wallet is kept as secure as possible. One of the most popular crypto wallets for metaverse purchases is called MetaMask, and it has plenty of advantages.
It is considered a non-custodial and cross-chain wallet that lets you store various crypto assets, including Ethereum, Binance Smart Chain, Polygon, and more.
The problem is that even though MetaMask is non-custodial, it’s still a wallet connected to the Internet. Crypto theft is a rising problem, which means that your wallet has to be protected.
Take the Metaverse With a Grain of Virtual Salt
It’s important to make several closing observations here. First and foremost, the metaverse is definitely speculative. Many metaverse projects may not make it. Some will be smash-hits five years from now.
It’s important to look at the technology, not just the current players in the marketplace. As technology continues to improve, the utilities and visuals within the metaverse will improve right along with it.
Like any speculation, it’s wise not to put your nest egg into the metaverse or any money that you desperately need. Yet if you’re looking for the next thing to jump into, a little metaverse speculation wouldn’t be a bad idea.