www.trtworld.com Open in urlscan Pro
52.16.168.55  Public Scan

Form analysis
2 forms found in the DOM

Name: formSuggestedSearch — GET /search

<form action="/search" method="get" name="formSuggestedSearch">
  <input type="hidden" name="_token" value="AOiVVeipodHOU1hg5k0VOpXNMoRcZWtzJBeD3afA">
  <div class="typeahead__container">
    <div class="typeahead__field">
      <div class="typeahead__query">
        <input class="suggestedSearch" id="headerSearch" name="query" type="search" placeholder="What can we help you find?" autocomplete="off">
      </div>
      <div class="typeahead__button">
        <button id="headerSearchSubmit" type="submit"></button>
      </div>
    </div>
  </div>
</form>

<form>
  <h1>Don’t miss out on the Latest News</h1> <!----> <!----> <!---->
  <h3>We won’t spam you and we respect your privacy.</h3> <input type="text" name="email" placeholder="Your Email"> <button type="submit" name="email" class="subscribe-submit">SUBSCRIBE</button>
</form>

Text Content

 * ●  Watch Live
   

Toggle navigation
 * 

 * Regions
   * Americas
   * Asia
   * Europe
   * Middle East
   * Africa
   * Turkiye
 * Sections
   * Arts & Culture
   * Business
   * Life
   * Sports
 * Opinion
 * Magazine
 * Topics
 * Documentaries
   * A Place Called Pakistan
   * Digital Documentaries
   * Focal Point
   * Off The Grid
   * Storyteller
 * Video
 * More
   * Perspectives
   * Research Centre
   * World Citizen
   * Jobs
 * Watch Live
 * 

SHARE

 1. News
 2. Magazine


WHY INVESTORS SHOULD BE CAREFUL ABOUT THE METAVERSE REAL ESTATE BOOM

 * 
 * John Mac Ghlionn
 * 
 * 8 Feb 2022


What would you like to learn more about?
Topics
 * United States of America
 * Americas
 * Northern America
 * Metaverse
 * Zuckerberg Metaverse

Related
 * Obama aide: how we got it wrong in Yemen
 * Far-right violence now a bigger threat to the US than Daesh and Al Qaeda
 * Does the end of the Mueller investigation clear the road for Trump in 2020?
 * Israel-UAE rapprochement event draws fire in Washington
 * When Muslims condemn terrorism, does it matter?

Popular
1
Q&A: Visibly Muslim Britons are still 'othered' in the UK
2
Killing the Indian in the Heart of the Child | Storyteller
3
How Djokovic’s detention highlighted Australia’s migrant detention problem
4
Turkish Cypriots seek OIC support in ‘holy battle’ for equal rights
5
‘What is our fault?’: Afghans wonder why they should pay for 9/11 victims

Insight


BUYING PARCELS OF VIRTUAL LAND HAS BECOME ALL THE RAGE AMONG “CRYPTO WHALES,”
BUT IF YOU PLAN ON PURCHASING PROPERTY IN THIS STRANGE NEW WORLD, PLEASE
EXERCISE CAUTION.

In 2021, real estate on metaverse platforms reached half a billion dollars. If
current trends continue, sales this year could reach $1 billion. 

All of this sounds a little surreal. Today, companies like Metaverse Group, a
Toronto-based virtual real estate agency, are busy dropping millions of dollars
on parcels of digitised land, developing them, and then leasing them out. 

But leasing them out to whom, you might ask. People willing to take a gamble.
Lorne Sugarman, the CEO of the Metaverse Group, compares the great “land grab”
to “the early days of European settlement in the US.” 

In the metaverse, real estate “will appreciate as more people and brands
arrive.” 

Will it, though? Is “digital gentrification” here to stay?

Perhaps it is. Nevertheless, Edward Castronova, a professor of media at Indiana
University, certainly won’t be investing in virtual property.

Castronova, author of “Life is a Game,” has published numerous papers on the
economies of synthetic worlds. Now, of course, some academics argue that the
metaverse is not a synthetic world; in fact, it’s just as real as the “real”
world, they protest.

Castranova told TRT World that the “current metaverse real estate boom is a
speculation market,” and that booms “like this have been happening every
four-five years since the early 2000s.” 

Contrary to popular belief, there is “no content in most of these places. There
is nothing that attracts eyeballs. And only eyeballs generate value.” 

Castranova added, a “URL is a ticket to virtual land too, but at least it gives
access to a genuine value stream.” 

Although “short term speculative gains are possible,” Castranova has “never seen
long-run value emerge from a virtual land product.” 

Castranova, clearly no fan of the property rush occurring in the metaverse,
believes that we are witnessing “the slow-moving decay of naively invested
money, exactly as you would find with day traders and sports gamblers.” Others,
though, are less sceptical.

Pastor D.J. Soto, the lead pastor of VR Church, recently delivered a sermon in
metaverse from his home in Virginia, US. (AP)

Ten-fold growth

A land boom, as many readers already know, involves a rapid increase in the
market price of real property (such as housing). Prices continue to rise until
they reach unsustainable levels; then, spoiler alert, they decline. Sometimes
precipitously so. 

A century ago, the state of Florida experienced a land boom of epic proportions,
with land speculation prices based more on hype and lies rather than actual
economic realities. More recently, the world experienced the financial crisis of
2007–2008, when the bursting of real estate had ripple effects, from New York to
New Delhi. Of course, real estate bubbles can be very difficult to identify,
even as they are occurring in real-time. The line between intrinsic value and
current market is a fine one.

However, in virtual worlds, identifying real estate bubbles appears to be a
little easier. The period that occurs just before a crash is known as the froth.
A frothy market is characterised by bullish investors that ignore, intentionally
or otherwise, market fundamentals. 

Speculation and supercharged emotions reign supreme. Rationality cast aside.
Right now, in the metaverse, things look very frothy indeed. Are we destined for
a digital real estate crash, now that many pieces of virtual property are
selling for more (and sometimes much more) than actual, real-world property?

TRT World reached out to Janine Yorio, the CEO of Republic Realm, a leader in
metaverse and non-fungible token (NFT) innovation and investment. According to
the company’s website, “Republic Realm is one of the most active investors in
and developers of the metaverse real estate ecosystem.” 

The company invests in, manages, and develops assets “including NFTs, virtual
real estate, metaverse platforms, gaming, and infrastructure.” Today, Republic
Realm is one of the largest landowners in Axie Infinity, Decentraland, The
Sandbox and Treeverse, all leading virtual spaces that allow users to create,
use, and, most importantly of all, monetise their own virtual reality NFTs. In
short, when it comes to the metaverse and virtual property, Yorio is very much a
person in the know.

Republic Realm, owner of more than 3,000 NFTs, has holdings in 24 metaverse
platforms. According to research carried out by Republic Realm, which Yorio was
kind enough to share with TRT World, since January of 2021, “the average price
of a parcel in the four major metaverses has increased by tenfold, from $1,265
to $12,684.”

For anyone looking to purchase property in the metaverse, the average price of a
parcel of real estate is about $11,000 today. At the time of writing, according
to Republic Realm’s research, the platform Decentraland “has a market
capitalisation of $6.5 billion and more than 800,000 registered accounts.”

Interestingly, according to Yorio and her colleagues, the term “metaverse real
estate” has absolutely “nothing to do with ‘real estate’ at all.” How so? In
short, these are “programmable virtual spaces in very early-stage technology
companies. 

Unlike “real” real estate, there is “almost no chance of generating meaningful
income from these assets. Real estate is generally a steady asset class that is
used to counteract a portfolio’s exposure to tech or other high-risk asset
classes.” However, this “asset class has exactly the opposite effect.”

Differences of definitions aside, do the gurus at Republic Realm see a crash
coming any time soon?

In short, no. As the company’s research shows, “only about 25,000 individual
crypto wallets actually own metaverse real estate.” In other words, in a world
of eight billion people, very few are actually invested in this mysterious new
world. 

“Compared to the number of people (180m+) who own Bitcoin or 360k+ who own
NFTs,” the researchers call metaverse property investments a “drop in the
bucket.” 

However, they stress that there is immense growth that has not yet been
realised. Just because a crash is not inevitable any time soon, this doesn’t
mean that a crash won’t come. Before going any further, it’s important to note
that, rather obviously, Republic Realm very much has a horse in the metaverse
race. In fact, it recently paid more than $4 million for land in Sandbox, the
aforementioned futuristic platform.

Analysts at Republic Realm firmly believe that “the metaverse is the greatest
wealth creation opportunity in our lifetime, the transition from a 2D internet
to a 3D interactive one. Again, though, wealth creation for whom? Savvy
investors, hedge fund managers, and wealthy celebrities, it seems.

 As Republic Realm’s research notes, the majority of “investors in this space
are either crypto “whales” – people who are already very comfortable with the
risk and volatility of crypto investing or professional investors, specifically
hedge funds and family offices.” 

These are not your everyday citizens. They are “generally sophisticated
investors who understand that this is a derivative trade of crypto and that
total loss of principal is one likely outcome.”

Yorio stresses that, although “metaverse real estate prices have catapulted to
new highs in recent months, the asset class is still held in the hands of very
few people. As more investors look to gain exposure to this tightly-held asset
class, they will find few good options and the existing choices are likely to
further increase in value until new metaverse platforms selling their real
estate come online.” 

The best way – and perhaps the only sensible way – to invest in metaverse real
estate she advises, “is through a broadly diversified portfolio, managed by
professional investors” with inside knowledge. 

In other words, if you plan on purchasing property in this (brave?) new world,
please exercise caution. Speak with people in the know, otherwise, you could
find yourself duped like the Florida-based investors of yesteryears. 

Source: TRT World
AUTHOR
John Mac Ghlionn
@ghlionn

John Mac Ghlionn is a researcher and essayist. His work has been published by
the likes of Newsweek, New York Post, Yahoo Finance and Sydney Morning Herald.


Related News

OBAMA AIDE: HOW WE GOT IT WRONG IN YEMEN

FAR-RIGHT VIOLENCE NOW A BIGGER THREAT TO THE US THAN DAESH AND AL QAEDA

DOES THE END OF THE MUELLER INVESTIGATION CLEAR THE ROAD FOR TRUMP IN 2020?

ISRAEL-UAE RAPPROCHEMENT EVENT DRAWS FIRE IN WASHINGTON

Category News

TURKISH CYPRIOTS SEEK OIC SUPPORT IN ‘HOLY BATTLE’ FOR EQUAL RIGHTS

‘WHAT IS OUR FAULT?’: AFGHANS WONDER WHY THEY SHOULD PAY FOR 9/11 VICTIMS

AFRICA IN ANKARA: SUPPORTING WOMEN THROUGH AFRICAN HOUSE

KILLING THE INDIAN IN THE HEART OF THE CHILD | STORYTELLER

 * United States of America
 * Americas
 * Northern America
 * Metaverse
 * Zuckerberg Metaverse

BACK
 * Obama aide: how we got it wrong in Yemen
 * Far-right violence now a bigger threat to the US than Daesh and Al Qaeda
 * Does the end of the Mueller investigation clear the road for Trump in 2020?
 * Israel-UAE rapprochement event draws fire in Washington
 * When Muslims condemn terrorism, does it matter?

BACK
1
Q&A: Visibly Muslim Britons are still 'othered' in the UK
2
Killing the Indian in the Heart of the Child | Storyteller
3
How Djokovic’s detention highlighted Australia’s migrant detention problem
4
Turkish Cypriots seek OIC support in ‘holy battle’ for equal rights
5
‘What is our fault?’: Afghans wonder why they should pay for 9/11 victims

BACK
 * Show people, places and other topics in this story
 * Read articles related to this story
 * See what's popular on TRT World

CLOSE
What would you like to learn? LEARN MORE
A picture is worth a thousand words. Follow us on Instagram.
FOLLOW TRTWORLD


DON’T MISS OUT ON THE LATEST NEWS


WE WON’T SPAM YOU AND WE RESPECT YOUR PRIVACY.

SUBSCRIBE


TRT WORLD ON YOUTUBE

Subscribe to our Youtube channel for all latest in-depth, on the ground
reporting from around the world.

Subscribe


TRT WORLD
ON FACEBOOK

Like
Follow
Follow
This site uses cookies. By continuing to browse the site you are agreeing to our
use of cookies. Learn more
Accept

Copyright © 2022 TRT World.

TRT WORLD

 * Watch Live
 * TV Schedule

WHERE TO WATCH

 * Connect with TRT World
 * iOS
 * Android
 * Youtube
 * Satellite Coverage
 * Partner Hotels

CORPORATE

 * About TRT World
 * Partnership
 * Jobs
 * Press Releases
 * Documentary Submission
 * Contact Us

LEGAL

 * Terms of Use
 * Privacy Policy
 * Cookie Policy

Copyright © 2022 TRT World.

Help us improve by sharing your feedback.