The non-fungible token (NFT) space is evolving fast, and NFT land has become a booming industry. Put simply, NFT land is a virtual area that you can own within a blockchain “metaverse” world – and there are now several different worlds that trade it.
In these worlds, you can interact with other people through your digital avatar. And if you own NFT land, you can build on it – just like regular land. The value of NFT land varies quite a lot though, and there are a few reasons for that. Here are the three main ones to consider when you’re scouting for land in the metaverse.
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Location is a huge driver of NFT land value: just look at Fashion Street Estate. It’s in Decentraland – a vast digital world built on the Ethereum blockchain – at the heart of the fashion district, and it sold for $2.4 million last November. While that was at the peak of a crypto bull market (bitcoin’s price was over $60,000 at the time), the estate’s location certainly helped bid up its price.
Fashion Street Estate’s new owner is building virtual shopping centers there, where avatars can buy all kinds of NFT items with Decentraland’s currency (MANA tokens). The estate hosted Decentraland’s first ever virtual Fashion Week in March too, with big brands like Tommy Hilfiger and Dolce & Gabbana flaunting their finest NFT apparel.
Screenshot of Decentraland’s home page.
2. Land size
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As you’d expect, larger plots of NFT land usually command higher prices (all else equal). The Sandbox, for example, is a 15.4 square mile metaverse made up of 166,464 different NFT parcels of land of 1033 square feet each. The cheapest single parcel goes for just under 1.5 ether on NFT platform Opensea right now, while the cheapest double one costs around 4 ether.
Cheapest NFT land parcels for The Sandbox on Opensea.
When you buy land in The Sandbox, you can build your own digital experience on it to bring in the crowds. And the larger your plot, the bigger that experience can be. Rapper Snoop Dogg, for example, is building the Snoopverse: a virtual world for fans that’ll include a digital version of his California mansion, metaverse rap concerts, and NFT Doggie avatar drops.
NFT Doggie variations in the Snoopverse on The Sandbox.
3. 🤩 Crypto security never look so good
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When it comes to your digital investments, safety comes first. Of course, it’s always a bonus when safety comes wrapped in a pretty little package.
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4. Quality of metaverse world
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It’s no use owning prime real estate in a world that’s destined to implode. So be sure to research the quality of a metaverse project before becoming a landowner.
That means studying the project’s network effects, for one. You could start by looking at how many crypto wallet addresses engage in the world each day, as well as the number of transactions taking place among players. On top of network effects, you should carefully analyze the project’s team, use case, roadmap, and tokenomics.
You’ll also want to check NFT marketplaces like Opensea and Rarible to see how often land changes hands in your favorite virtual destination. There’s no hard and fast rule here, but places where land is traded more often have a more “liquid” property market. That means you’ll be more likely to find a seller if you decide to cash out your investment.
If you’re looking for digital land on the blockchain, a recent report by DappRadar places Decentraland and The Sandbox among the best options. You could also check out Somnium Space, Cryptovoxels, and NFT Worlds.
- You can buy and sell virtual NFT land within several metaverse projects now – and it’s a booming industry.
- If you own virtual land, you can build on it to earn extra NFT income.
- When scouting for NFT land, location and size are two important factors – and you’ll want to make sure the land exists in a high-quality metaverse project too.
This guide was produced in partnership with Ledger.
Check out Ledger’s mini-website at finimize.com.