The metaverse is a term that has recently invaded the international media landscape and has all the web giants dreaming. Mark Zuckerberg has strongly contributed to the resurgence of this word (created in 1992 by Neal Stephenson in his book Snow Crash) by announcing that he would rename his Facebook group "Meta" on October 28, 2021. At the same time, cryptocurrencies have never been so much in the news! Real estate, but also gaming, work, culture: everything will now be possible in this virtual world. But what is the metaverse? Can we invest in virtual real estate?
1. What is the metaverse?
The metaverse, which means "beyond" (meta) the "universe" (vers), is a fictional world that combines virtual reality, augmented reality and extended reality. The term is regularly used to describe a future version of the Internet where virtual, persistent and shared spaces will be accessible via 3D interactions. It reflects the next big leap in the evolution of the Internet.
The metaverse already exists in a simplified version: human beings are replaced by avatars, a kind of digital doubles - well beyond social networks. A company called Virbela has recruited 160 employees through the metaverse and they never see themselves in the physical world. You should also know that there are several different metavers in which you can practice several activities.
What is the objective?
The metaverse attempts to create bridges between the real and virtual worlds. This fusion of the two worlds allows users to practice many activities. It is a space where real value exchanges take place: between users or between the platform and brands through content, products, or discussion. In this virtual world, everything is possible: organizing fashion shows, buying art, owning land, doing real paperwork, working, playing.
If the metaverse is gaining popularity, it is due to the fact that more and more people are moving their activities online, especially due to the Covid-19 pandemic.
Recently, Seoul invested 3.9 billion won (about 2.8 billion euros) in the creation of the Metaverse Seoul: a project that is part of the Seoul Vision 2030 plan launched by its mayor Oh Se-hoon. The goal? To make Seoul "a world leader, a city of coexistence, security and emotion", said the mayor.
Seoul residents will be able to put on their virtual reality helmets to meet city officials in this new space and will even be able to attend major events. The goal is to overcome the temporal and spatial constraints, especially for people with reduced mobility.
2. Virtual real estate in the metaverse
Virtual real estate is on the rise! The metaverse now appears as a marketplace where anyone can buy land. The virtual real estate takes the codes of the real world: spaces are delimited, owners have plots of land and can build, resell, buy and rent! Every week, hundreds of millions of dollars are spent to buy virtual housing.
What is the point of buying a virtual property or land?
You must be thinking that it may seem expensive and out of touch with reality (so to speak). The idea of spending millions to own virtual property is for many completely unbelievable.
Buying and selling plots of land through virtual real estate therefore raises the question of its usefulness in the medium or long term? Participants have a creative desire to express themselves by owning objects in the metaverse: in this case, owning land. Or they are just speculators who see it as an investment. Because the potential return on investment looks promising.
100 million in sales in one week was recently achieved! According to Grayscale, the market opportunity to bring any number of metavers to life can be worth over $1 trillion in annual revenue. The asset management company estimates that virtual game revenues could reach $400 billion by 2025, up from $180 billion in 2020!
Many experts agree that virtual land purchases will help transform the metaverse (or even individual metavers) into a dynamic virtual ecosystem in which we will all participate, more or less.
4. Can we invest in virtual real estate?
It is difficult to predict the future for this new market. However, for the moment, it is important to specify that the market of the virtual real estate has only known the rise. It is inevitable that one must do several researches before launching into such an investment and not to risk investing more than one can afford to lose!
Now, anyone has many options for buying NFTs. Whereas before the purchase of virtual objects was limited to video games (e.g. Minecraft), today you can invest in land as NFTs, on Tilia.Earth for example.