People are paying ‘real’ money for ‘virtual’ real estate in the Metaverse: a deeper look at the 2021-2022 Metaverse trend.

With the new “bull run” or “rising market” of cryptocurrencies in 2021, we saw an already existing concept make a serious breakthrough in the mainstream media: “the metaverse”. The metaverse is a virtual world, completely in 3D, where people can interact with each other and where almost anything is/will be possible.

With the new hype came new investors and vice versa. For example, almost all ‘metaverse crypto projects’ shot up in 2021. Not only the projects as a whole through their ’tokens’, but also the individual pieces that are for sale on the metaverse. Similarly, everyone was stunned when a $2.43 million sale took place, by far the largest real estate deal to date in the metaverse.

This transaction took place on the metaverse platform ‘Decentraland. There are several such virtual platforms outside Decentraland. Other very prominent players in 2021 and early 2022 are: Axie Infinity and Sandbox. The creators of this platform certainly do not build everything themselves: users can create and trade things themselves on the metaverse and all transactions are then objectively tracked on the blockchain. The currency of the transactions is therefore in the cryptocurrency of the platform in question, so that the value also rises or falls as there is more or less demand for the unit.

Such a metaverse platform is made possible by using technologies such as blockchain technology, virtual reality (VR) and augmented reality (AR). Virtual reality and augmented reality are technologies that are very close to our hearts at P1: they rely on 3D modeling. For example, we could eventually make a lot of our work available on the blockchain for users of the metaverse.

How can anyone pay so much for land that doesn’t really exist? Well, it does exist, only virtually. And where digital copies can normally be made on the ’traditional’ internet and a virtual landscape can be expanded endlessly, this is not the case with a metaverse.

In the long run, of course, different ‘metaverses’ or virtual worlds may exist. However, they will be limited, which gives value to having a “property” in such a world due to the scarcity. If the demand increases and the supply becomes limited in such a virtual world, the value of the property increases.

For example, the metaverse where the monster sale of $2.43 million happened, Decentraland, has 90,000 pieces of land of the same size for sale. In 2017 and 2018, they were all initially sold at auction, but they are still resold on the Decentraland marketplace as their value continues to increase.

As a reader, you may still be wondering: what exactly is the use/purpose of such a metaverse outside of the ‘hype’?

Everything about transactions has become more secure due to the blockchain. The metaverse, like the “real” world, will eventually be used and developed:

The land can be built on: commercial or residential new construction projects.

Those buildings can then be sold or rented to others. For example, one of the most obvious options is a virtual office that can be rented out to other companies. All kinds of fun activities can also be organized on the plots of land or in the buildings on them! There will no doubt be cafes, clubs and restaurants in the Metaverse.

In addition, there is also the important application of advertising. Why do brands invest in virtual real estate? Of course to be able to show their brand here as well as possible to visitors of the Metaverse.

Hopefully, this has given you a better understanding of what exactly the Metaverse is/will become and why people believe so strongly in its potential.

With P1, we’re not experts in the Metaverse, but we can do anything related to content creation. If you would like to show ‘building’ in the Meta fresh and high-quality 3D models, then you have come to the right place!

Curious about our services? Read more about our approach here!

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