Once a red-hot trend capturing the imagination of investors and tech enthusiasts alike, the Metaverse is now experiencing a downturn in interest and demand.
Virtual real estate in the Metaverse, which was once considered a valuable asset, is facing a decline in value and trading volumes.
The once highly sought-after virtual land is seeing a significant decrease in trading volumes, dropping from a staggering $1 million per week to a meager $50,000 per week.
The decline in interest extends beyond virtual real estate, as attendance at virtual fashion events, such as Decentraland’s Fashion Week, has also seen a notable drop.
While platforms like Fortnite and Roblox continue to thrive, Metaverse platforms like The Sandbox and Alien Worlds are facing challenges.
Despite this recent downturn, some experts still hold optimism for the future of the Metaverse, expecting exponential growth in the secondary trading market.
However, notable figures like billionaire Mark Cuban and YouTuber Dan Olson express skepticism about the long-term value of virtual real estate.
What will happen next is anyone’s guess, but this juncture seems like the perfect opportunity to take a look at the Metaverse timeline over the past couple of years, including it’s meteoric rise and subsequent downward spiral.
December 2021 – Virtual land a hot commodity in the Metaverse
A digital investor has paid a record-breaking $4.3 million for a block of virtual land in The Sandbox Metaverse, following a trend of increasing uptake in the Metaverse.
- The Sandbox is a virtual Metaverse where players can build, own, and monetise their virtual experiences.
- Republic Realm, an active investor and developer in the Metaverse real estate ecosystem, purchased the land from Atari SA.
- The sale surpasses the previous record set a week earlier when Tokens.com bought a virtual block of land in Decentraland for $2.4 million.
- Virtual land in the Metaverse is considered rare and valuable, similar to domain names, with its perceived scarcity driving high prices. Republic Realm has also made significant purchases in other virtual properties, including a non-fungible token (NFT) representing 259 parcels of digital land on Decentraland.
To read the full story on buying virtual land in The Sandbox click here.
December 2021 – Alexander brothers become the first luxury brokers of the Metaverse
Douglas Elliman’s Oren and Tal Alexander, known as the Alexander Team, are partnering with Republic Realm to develop and sell luxury virtual properties in the Metaverse.
- Republic Realm recently made headlines for their $4.3 million purchase of virtual land in The Sandbox Metaverse and their successful NFT project, Fantasy Islands.
- The Alexander Team, renowned for their real-world megadeals, plans to focus on luxury prestige properties in various Metaverses, including The Sandbox and Decentraland.
- The move into Metaverse property sales is inspired by their own interests and the changing preferences of younger generations, who are increasingly engaged in the digital world.
- The trend of virtual properties commanding high prices is gaining credibility, and early investors in digital property are considered pioneers and stand to benefit as the Metaverse expands.
Read the full story of the Alexander brothers partnership with Republic Realm here.
January 2022 – Ryan Serhant: The evolution of cryptocurrency, blockchain and the Metaverse in real estate
Million Dollar Listing New York star Ryan Serhant predicts that cryptocurrency will account for 50 per cent of all real estate transactions in the near future, with contracts recorded on the blockchain and signed as NFTs.
- Businesses worldwide are focusing on blockchain, NFTs, and Metaverse integration, with the Metaverse estimated to be worth $500 billion in 2020 and projected to reach $800 billion by 2024.
- Serhant highlights the growing understanding and adoption of cryptocurrency, blockchain, and the Metaverse, citing examples such as the mayor of Miami proposing cryptocurrency payments for property taxes and a $28 million residential crypto real estate transaction in Miami.
- Blockchain technology can enhance security, speed, and transactional processes in real estate deals, reducing liquidity risks and potentially challenging large banks.
- Serhant’s technology team is actively working on implementing blockchain technology in his real estate brand, aiming to revolutionize the traditional contract signing process and reduce fraud risks associated with paper or PDF contracts.
Read the full story on Ryan Serhant’s take on the Metaverse here.
Perth woman buys virtual penthouse in the Metaverse
A Perth woman recently dropped a bit more than $1000 on a virtual penthouse in a Metaverse that hasn’t even launched yet.
- The Uphoria Metaverse features various virtual amenities, including skyscrapers, restaurants, fountains, sports centres, hotels, and a teleportation centre.
- The buyer intends to use the virtual penthouse for hosting Zoom calls and inviting others to join her in a stylish virtual environment.
- The Metaverse market, which consists of 3D virtual worlds emphasising social connection, has seen significant growth and is projected to be worth $800 billion by 2024, according to Bloomberg.
- Other notable transactions in the Metaverse market include Republic Realm’s $4.3 million purchase of virtual land in The Sandbox Metaverse and Tokens.com’s $2.4 million acquisition of virtual land in Decentraland.
Read the full story on the Perth woman’s Metaverse penthouse here.
May 2022- Welcome to the Metaverse: What it is and why it matters to real estate
Snoop Dogg’s buying there, Ryan Serhant’s selling there, and now the world’s biggest social media company has rebranded to incorporate its name. But what exactly is the Metaverse, and why should the real estate industry pay close attention to its increasing fame? We take a look at a world where real estate that you will never physically touch is proving a growing trend.
- The rise of the Metaverse has gained significant attention, particularly after Facebook rebranded to Meta.
- The Metaverse is a digital world beyond the universe, where people can create characters, purchase items, and interact in a virtual space.
- The integration of blockchain, cryptocurrencies, and NFTs with the Metaverse has resulted in the purchase and sale of digital assets using non-fungible tokens.
- The Metaverse has expanded beyond gaming, with entertainment, education, and real estate being explored as additional use cases.
- Celebrities like Snoop Dogg have purchased virtual land in the Metaverse to establish their presence and offer exclusive experiences to fans.
- The concept of location is crucial in the Metaverse real estate trend, with certain areas commanding higher values due to increased foot traffic and brand exposure.
- Virtual real estate companies are emerging, facilitating the development, experiences, and sale of virtual land across multiple Metaverse realms.
- Metaverse real estate has seen a continuous upward trend, with increasing interest and rising property values.
- High-value transactions, such as the purchase of virtual land by Republic Realm and Tokens.com, have attracted the attention of renowned real estate agents.
- The potential of the Metaverse goes beyond property transactions, with possibilities for marketing, showcasing developments, and using traditional real estate skills in the virtual space.
Read the full feature story on what the Metaverse means to real estate here.
July 2022 – Knight Frank and Fred Schebesta examine how crypto, NFTs and the Metaverse might shape Australian real estate
Global property consultancy Knight Frank has turned its attention to the rise of cryptocurrency, NFTs, and the Metaverse, with the group joining forces with Finder founder and crypto investor Fred Schebesta to decode some of the Australian trends emerging and how they impact real estate.
- Ultra-high-net-worth individuals are increasingly diversifying their portfolios with virtual assets alongside physical assets, with the Metaverse, cryptocurrency, and NFTs expected to play a larger role in wealth creation.
- Research indicates that a significant percentage of ultra-wealthy individuals in Australia own cryptocurrency, and a growing number are investing in NFTs, driven by the popularity of art collections and the potential for high returns.
- Some ultra-wealthy individuals are already using cryptocurrency to pay their mortgages, and the demand for crypto and NFTs is predicted to rise as investors seek new opportunities and hedges against inflation.
- However, there are still barriers to widespread adoption, including a lack of understanding about utility and concerns about market volatility. Additionally, the report highlights the potential offered by blockchain technology, decentralised finance, and Web3 in the digital revolution.
- The Metaverse is identified as a significant investment opportunity, with the convergence of physical and digital real estate presenting retail opportunities. Digital land and NFT property titles are seen as areas of growth and improvement within the real estate sector.
Read the full story on Knight Frank’s and Fred Schebesta’s collaboration here.
December 2022 – The first Metaverse skyscraper takes shape (December 2022)
Construction has begun on the first Metaverse residential skyscraper called Skylum, developed by Crypto House Capital, a virtual real estate firm.
- The goal of the project is to create a community within the Metaverse where people can interact and brands can establish a presence.
- The concept of “digital twins” or virtual counterparts of physical buildings will appeal to existing communities and contribute to vibrant Metaverse communities.
- The apartments in the virtual skyscraper are priced between four ethereum ($7,504) and 11 ethereum ($20,638).
- The Metaverse offers new opportunities for creative expression and collaboration, allowing users to engage in real-life activities with customisable avatars and explore various virtual experiences such as concerts, lectures, fashion shows, nightclubs, and art galleries.
- The development of a metareal city in the Metaverse aims to combine the online and offline aspects of people’s lives, offering a new way of living and experiencing both worlds while leveraging next-gen technology and immersive virtual reality.
Read the full story on the first skyscraper in the Metaverse here.
April 2023 – The real estate downturn hits the Metaverse
A couple of years ago the Metaverse was hot property, but just like in the real world, virtual real estate is also in decline.
- Metaverse virtual real estate, which was once highly sought after, is now experiencing a decline in value and demand.
- Trading volumes for virtual land have significantly decreased, dropping from $1 million per week to around $50,000 per week.
- The interest in virtual fashion events, such as Decentraland’s Fashion Week, has also decreased, with a significant drop in attendance.
- Gaming platforms like Fortnite and Roblox continue to thrive, while Metaverse platforms like The Sandbox and Alien Worlds are facing challenges.
- Despite the recent downturn, some experts believe that the future of the Metaverse remains positive, with expectations of exponential growth in the secondary trading market. However, billionaire Mark Cuban and YouTuber Dan Olson express skepticism about the value of virtual real estate.
Read the full story on the real estate downturn in the Metaverse here.