NFT Real Estate: Digital keys to non-physical locations.
NFT’s are the hot topic right now as 2021 emerged with trendy monkeys and other toon-like animals hitting the scene. As artists explore new income potential with this new asset class, it gives room to wonder what other implications could NFT’s have in other asset classes?
Like any ambitious citizen, owning land is a symbol of royalty as you are cementing your name in the record books. Yet there are a lot of issues with owning something physical, as it will always incur taxes, maintenance, and slow degradation. Owning something without the hassle was a pipe dream unless you take a look at NFT’s.
Can you really compare real estate to NFT’s? Honestly, right now it would be a very poor comparison. Real estate as the market currently is, shows far superiority than NFT’s. Yet this emerging trend has rapidly shown traction and has the money to prove it.
Let’s take a look an example of a project that has successfully found use cases for trading non-physical land, and how much further we have to go.
Decentraland ($MANA)
A forefather of the metaverse, MANA (powered by Ethereum) has bootstrapped digital estate ownership since inception in August 2017 during the ICO boom. Introducing 3D plots of land, that users can be creative with, purchase/trade for profit, and enjoy collectively at the same time.
Creators are the ones who control the content flow, by creating events, giving out digital clothes for avatars, and submitting district ideas. A sharp contrast from most games where content is restricted to the development team and their limited visions.
MANA has available plots of land for sale, to be purchased with $LAND, the native token of this metaverse. You can find listings here in their own curated marketplace. Which begs the question, what do users see in this project that drives millions of dollars in sales?
Digital rarity.
If we all listened to our economics teacher’s boring lecture, we should know that limited supply with an increase of demand causes price to go up. Even though you cannot walk on any plot of LAND in the metaverse, you can still virtually enjoy it. As long as others are enjoying this experience alongside you, then you have all immersed yourself into living through the game.
This happens all the time with standard video games such as Minecraft and GTA online, where a user can spend literal years building a virtual safe haven.
I Dedicated 9 Years To Building One EPIC Minecraft World! — YouTube
In total there exists only 90,601 plots within this metaverse with each plot taking up only 16 square meters! For an abnormally small world, contained within an absurdly high economy, we are witnessing a new age of wealth transference.
However, not everything looks bullish here. The gameplay is subpar, restricted to desktop experiences (they should have figured out mobile by now), comparable to games of the late 2000’s.
Can MANA compete with top tier developers such as Bethesda or naught dog? Absolutely not, yet millions of dollars have already piled into the market cap. Precluding the trend of years to come, land ownership is only gaining more traction. This was only a trial gone right for NFT’s, a success belonging to the bottom most rung of the metaverse.
What’s the next rung?
Climbing the ladder of inevitability, with each innovation the majority will completely ignore it. Until we reach the tipping point of actual adoption. Games in the metaverse are a great method of extracting value from the market but are not the final peak of NFT’s.
Land ownership is displayed primarily through games, some adding the functionality of renting land to other users for profit. But the games themselves are not enjoyable, and graphically archaic. As long as Web2 Developers, game developers, and UI developers join hands like the avengers. User adoption will flood in naturally, boosting the overall market cap for Metaverse / NFT sectors to over $1Trillion.
This will take time, money, caffeine, and no sleep for this sector to see such predicted results. Rest assured, the existing framework of buying physical land, looking at your tax bill, watching it rot, will be as outdated as your grandma’s dusty record player in storage.
