Metaverse: You can’t walk on this land or build a house, but lots are still selling for thousands of pounds | Science and tech news

Johnny McCamley has spent nearly £5,000 on lots.

But he can’t physically walk on this land – and he can’t live or build a house on it.

That’s because the 23-year-old’s investment is in the metaverse, meaning his country is completely virtual and exists solely in a digital world.

Mr McCamley, from Belfast, is one of the many people who have decided to buy virtual real estate in the metaverse.

Last year, virtual land transactions reached $350 million (£267 million) in The Sandbox, the largest digital property platform, according to a report from the Center for Finance, Technology and Entrepreneurship.

An additional $110 million (£84.2 million) in trades were made in Decentraland, the second largest metaverse platform.

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The metaverse allows users to interact with others, play games, build art galleries and shops. Photo: Johnny McCamley

What is the metaverse?

The metaverse is not a single digital space. It is a network of virtual reality worlds, set up by companies and platforms, where users can interact, play games, attend events and buy land.

A more famous metaverse is Horizon Worlds. It was created by Facebook, which has now changed its name to Meta as the tech giant shifts its focus to virtual spaces.

Other brands have also announced their own digital realms.

Manchester City plans to build the first metaverse football stadium in partnership with Sony.

Mr. McCamley, the chief executive of CryptoClear, bought his lot in The Sandbox last October. He said: “There are casinos in the metaverse, there are also museums, but there are also events like podcasts and also conferences that I attended. So the best way to look at it is, it takes the real world and digitizes it a lot. beyond that of Zoom.”

Facebook has been renamed Meta
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Facebook rebranded as Meta in October 2021

Why do people buy virtual real estate?

For Mr. McCamley, the opportunity to stake a claim in this imaginary world was an opportunity not to be missed, despite the uncertainty in the market and price volatility that make it a risky investment.

“It’s like every new investment, every new asset class. When I got into Bitcoin when it was $300 I was told it was extremely risky, same with Ether at $4. I think getting a piece of land in Decentraland at $4,000 an absolute bargain,” he said.

He plans to hold onto his purchase for 10 years: “I think the metaverse will mature in about ten years and I’ll think about selling the land when that time comes.”

Landowners can also use their virtual spaces to design experiences for others to enjoy.

“The community owned lands, they are my favorite. A very, very good example is, I believe it’s a ‘gecko beach’ that someone did and that as you can guess is a beach full of geckos said Mr McCamley.

Johnny McCamley, from Belfast, owns three plots of virtual land in the metaverse
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Johnny McCamley, from Belfast, owns three plots of virtual land in the metaverse

House hunting in the virtual world

Searching for the perfect home in the metaverse is similar to real life.

Land next to roads and near desirable neighborhoods such as “fashion” or “museum” areas will have a higher price tag and more attractive investment opportunities.

In The Sandbox, busier central areas near other points of interest are much more expensive than newer neighborhoods on the outskirts.

Who your neighbors are also affects the value of your home.

In September 2021, rapper Snoop Dogg announced his own digital “Snoopverse” in The Sandbox.

Two months later, a property adjacent to his plot sold for over $450,000 (£350,000).

But, unlike traditional real estate purchases, there is no third party or legal presence that can ensure that deals are legit.

This can be risky when buying from a secondary market like OpenSea, where purchases are made using cryptocurrency.

"Meta architects"  help design interactive virtual spaces for people and businesses
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‘Meta architects’ help design interactive virtual spaces for people and companies

Why do people build virtual real estate?

In addition to landowners, there is a new generation of ‘meta-architects’ who design virtual spaces.

Stavros Zachariades is a traditional architect who works in South London but started designing for the digital world during the pandemic after his brother Adonis founded Renovi, an NFT marketplace.

The 37-year-old recently designed pop-up stores for metaverse fashion week.

“The appeal of the metaverse and building in the metaverse is” [people and businesses] can show what they are about,” said Mr. Zachariades.

“They can show their products. We can provide meeting spaces for different people, especially now with COVID and the last two years when people are more distant.

“You can have, from the realm of super-sci-fi, floating buildings that rotate and transform — and on the other side of the realm, historic, classical architectural styles.”

He thinks the metaverse could open doors for people who don’t have connectivity in real life: “I thought about how accessibility can change, for example that someone who doesn’t have the same mobility can just be an equal in the metaverse. Why not? “

With increasing demand for virtual properties, 'meta architects' are moving forward to help design interactive digital spaces.  Photo: Stavros Zachariades
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With increasing demand for virtual properties, ‘meta-architects’ are stepping forward to help design interactive digital spaces. Photo: Stavros Zachariades

‘It’s just impossible to know what the endgame is’

But many warn that these investments could flop.

Birmingham-based YouTuber “Mitch Investing” regularly delves into topics such as personal finance and emerging technologies on his channel.

He thinks promises that the metaverse will become part of our daily lives may be exaggerated.

“It’s so early in its development that it would be like investing in a company that’s only been around for a year. You’re not sure if it’s going to get off the ground or not, not so sure where the company is going, not too certainly how the business model might develop…it’s highly speculative in my opinion,” said the 26-year-old.

There is a concern that not all virtual worlds will succeed in attracting a large enough number of users.

“There can be thousands of metaverses like there are websites today. It’s just impossible to know what the endgame is,” he warned.

Youtuber Mitch Investing thinks buying virtual real estate is a very risky investment strategy
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YouTuber Mitch Investing thinks buying virtual real estate is a risky investment strategy

Risk and Volatility

The Financial Conduct Authority labeled cryptoassets “high-risk, speculative investments” and warned that people trading them should be prepared to lose all their money.

There are also broader security concerns for users in terms of online harm.

The newly introduced Online Safety Bill takes into account activities in the metaverse, requiring companies to take action if fraud is committed by users, including those in virtual reality spaces.

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