You may heard the term virtual real estate that is also associated with the Metaverse and both are interchangeably used. Virtual real estate is basically a key part of the metaverse and can be one. Let us be a more specific about the term in this post.
NFT virtual real estate is a collection designed and developed representing virtual real estate assets and experiences that are minted on the blockchain.
Just like other non-fungible tokens, NFT is created, minted and stored in a digital wallet where whoever bought it is the owner of the metadata (code) and media file of the asset (land picture and elements).
With the COVID-19 pandemic occurring and the trend of working remotely, nowadays the virtual worlds seems viable and a place to use in the future.
Business owners and entrepreneurs are looking for ways to build the remote working environment, and enhance the gaming and entertainment experience.
Anyway let us look more into the topic.
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What is NFT Virtual Real Estate?
A virtual real estate is a non-fungible token (NFT) meaning it is a one of a kind property. It has different uses particularly as a space for users to hang out and do various of activities.
This trend is driven by growth in the entertainment sector. It is also been influenced by how the ease of having working remotely has emerged.
It opened a new door for various activities including using it as a virtual business, house, and represent projects and even governmental entities.
Virtual real estate also created opportunity for new jobs given it has a working environment which requires moderators to manage and employees to interact in these places.
And of course when user traffic is there we can’t forget the big advertising organisations who are jumping in and get spaces to grab attention to their brands.
Here are some examples to give you an idea on how these NFTs are sold and by who.
The Sandbox
The sandbox is a place where you can buy land, building materials, and characters on voxel format. It has been built in a way where you can casually hangout or have games with your friends.
The token they use in the platform is $SAND.
Source: https://www.sandbox.game
NFT Worlds
NFT Worlds is another NFT virtual real estate collection which is built using Minecraft open-source code. Having said that, NFT Worlds lands sold to users are large compared to the Sandbox.
Users have the ability to build on a land using a familiar development environment for developers. It is used to have activities including gaming and hanging out.
They are using a token called $WRLD for in-game transactions
Source: https://nftworlds.com/
Otherdeed for Otherside
It is a newly made platform with eye-catching graphics created by Yuga Labs founders of the well-known Bored Ape Yacht Club (BAYC) collection.
They also offer plot of lands with unique different environments… But what can we do in there is still mystery.
Source: https://otherside.xyz/
Worldwide Webb
Is a 2D platform users can play in and create any content they want just like the prior examples. But instead of focusing on lands they have apartments, and penthouse thus the development experience tend to be inside the virtual real estate and is in 2D.
Source: https://webb.game
NFT Virtual Real Estate Characteristics
Now you know the overview, let us look at some of its characteristics. Note that these characteristics does not necessarily apply to all NFT virtual real estate but it is an indication of its possibilities.
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It can be a Virtual Alternative to the Real World
Activity in the NFT virtual real estate can work as a replacement to the real world. Whether it is just for games or to attend work.
It may sound strange, but with younger generations are going into the workforce, increase road traffic and how most companies became more tech-oriented the remote activities have become much more popular.
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It is a Secured way of Ownership
Because it is recorded on the blockchain, and ownership is verified on a public immutable ledger (can’t be changed) . It is a strong way to identify ownership.
As long as the buyer makes sure nothing happens to his digital wallet. He will always be the one controlling his property. And yes this is the only risk.
Some may say “it can be copied”, But they will not own the verified metadata by the creator of the collection and won’t have access to the utility behind it.
Anyone can copy Mona Lisa but the original is the valuable one.
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It can be utilised with Decentralised Finance
With Decentralised Finance, users can rent their NFTs or using them as a collateral for loans which includes the virtual real estate collections.
It is true that we are still early and may not work for all NFT projects, but the well-know projects are viable work. Here is a platform for lending NFTs for example called NFTfi.
If you are interested in this topic check out the post in this link for more details about DeFi services.
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It can be Bought as a Whole or a Fraction
Owning a virtual real estate can be expensive. With their floor price of 1.5eth for Sandbox lands for example not everyone want to expose themselves to that much risk in a virtual item.
One way to do that is through buying a fraction of an NFT. And this is possible through being part of a Decentralised Autonomous Organisation (DAO) which is a fancy way of saying a decentralised company/fund where you can buy shares indirectly and build a company.
The other way is through participating in buying fractional ownership shares through websites like Fractional.art.
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It can be Linked to Real Assets
Given how NFTs are recorded in the blockchain, and how ownership is securely verified it has opened a way to associate these properties to real world assets.
Here is a case study where a real estate start up called Propy sold a real house by bidding an NFT.
For more details on that check out the article on CoinDesk
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Final Thoughts
People might think that this is just a fad. But in reality, the potential is huge and we are still early. Of course, the winning projects are going to be few (maybe none of the mentioned here will exist in the next few years).
Still I am very excited for the technology. But please, make sure you do proper research before buying, never spend money you are willing to lose, and buy something you like.
Related Posts:
- Why are NFTs Expensive? 7 Reasons that Makes NFTs Valuable
- What NFTs Should I buy? a Comprehensive Guide
- What is the Metaverse and why you should care?
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