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The Mass Media

Is the metaverse feasible?


The logo of Meta, parent company of Facebook.

The metaverse is a network of 3D virtual worlds focused on social connection. In futurism and science fiction, this term is often described as a hypothetical iteration of the web as a single, universal virtual world that is facilitated by the utilization of virtual and augmented reality headsets. As the metaverse continues to grow in popularity, it’s important to question if the metaverse is even feasible. 

Real estate in virtual worlds is sometimes called the metaverse, and it’s going for millions of dollars in some cases. According to investors and analytics firms, the sales of real estate in the metaverse topped $500 million last year and could double this year. It’s no secret that the real estate market is skyrocketing, but the COVID-19 pandemic is creating another little-known land rush, and indeed, some investors are paying millions for the plots of land. The plots do not physically exist here on Earth, but rather, the land is located online, in a set of virtual worlds that tech insiders have dubbed the metaverse. The prices for the plots have soared as much as 500 percent in the last few months, ever since Facebook announced it was going all-in on virtual reality, even changing its corporate name to Meta Platforms. 

In these virtual worlds, real people interact as cartoon-like characters called avatars, almost like a real-time multiplayer video game. These avatars can come in all sorts of shapes and sizes. Today, people can access these worlds through a traditional computer screen, but Meta and other companies have a long-term vision of building a 360-degree immersive world, which people will access through virtual reality goggles like Meta’s Oculus. There are even major artists, like Ariana Grande and DJ Marshmello, performing as their avatars. Even Paris Hilton DJ’ed a New Year’s Eve party on her virtual island.

According to Yorio, the CEO of Republic Realm, the CNBC company sold 100 virtual private islands last year for $15,000 each, and today, they’re selling for about $300,000 each, which is coincidentally the same as the average home price in America. Thinking about the board game Monopoly, Kiguel, the CEO of tokens.com, said that they just bought Boardwalk, and the surroundings were areas where people congregate. These surroundings are far more valuable for advertisers and retailers because they find ways to get in there to access that demographic. For example, Snoop Dogg is building a virtual mansion on a plot of land in Sandbox, and someone recently paid $450,000 to be his neighbor. I think it matters who your neighbor is, and that’s kind of true of almost anything, right? It’s like a club and you want to be around people that share similar interests and buying a virtual land is pretty simple: either purchase directly from the platform or through a developer. 

Investors build on their land and make it interactive. One can decorate it, change it and renovate. It’s basically like a code, but Yorio cautions that investing in digital real estate is a risky business. One should only invest capital that you’re prepared to lose. It’s highly speculative. It’s also blockchain-based, and as we all know, crypto is highly volatile. But, it can also be massively rewarding. Mark Stapp, a professor and director for real estate theory who practices at Arizona State University, agrees that “if it continues the way it’s going, it is most likely going to be a bubble. You’re buying something that isn’t tied to reality.”