A Preliminary Study on the NFT Value of Metaverse Land
In March, there were frequent reports of success on the metaverse track. Yuga Labs, the parent company of BAYC, announced that it will launch virtual land sales and airdrop plans, and launch MetaRPG games and APECoin to jointly build Yuga Labs’ metaverse plan; Estee Lauder will present NFT to users as an exclusive beauty brand partner of Decentraland Metaverse Fashion Week; HSBC announced a partnership with The Sandbox, becoming the first global financial service provider to enter The Sandbox universe. Since Facebook announced in October 2021 that it would change its name to "Meta", "Metaverse" has become a hot word in many industries. The Crypto Metaverse project uses the core component of NFT to confirm its rights, and it has attracted many celebrities to settle in. The cooperation with well-known brands, the soaring valuation of Token, and the sharp rise in land prices have jointly contributed to the rapid development of Metaverse.
The NFTs in the metaverse can be mainly classified into two categories: characters and scenes. The role is the digital avatar of the user, which is the main body participating in the activities of the Metaverse. Digital wearable devices can also be classified as characters. Just as people in the real world flaunt their personality through clothing, we can dress up our own image through digital wearable devices. The scene is the land and the derived things (such as buildings) based on the land. It is the space carrier that carries the activities of the metaverse. All the land and the buildings on the land are always owned by the owner, and each plot is unique. of.
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(Metaverse billboard example)
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CryptoVoxels
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Decentraland
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The Sandbox
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(Project key information)
It can be seen that there are many differences in the rule settings of the above metaverse projects, and the prices of their land NFTs also vary greatly. So what are the factors that affect their prices?
Here, according to the order of selecting the project first and then the land, the comparison is made from the two dimensions of land value between different projects and the land value in the same project. The main factors that determine the value of land between different projects are the total amount of land, revenue mechanism and platform traffic, and platform traffic often depends on the user-friendliness of the project, the number of IP cooperation and the richness of scene construction. Specifically:
total land——The relationship between supply and demand determines the rise and fall of the price. If the land on the platform can be generated infinitely, the price of the land will naturally not rise. If the land available for purchase is limited, then with the further expansion of the metaverse platform ecology, the land will also increase. Appreciate accordingly. Previously, in order to attract more users to participate in the construction of the metaverse, Cryptovoxels set up unlimited land issuance to lower the participation threshold. On February 21, it released the roadmap for 2022, setting the upper limit of the previously set unlimited land issuance to 70,000, and plans to launch the Origin City land repurchase plan. Once the news was released, it greatly boosted the confidence of Cryptovoxels landholders, and the floor price rose accordingly.
Revenue Mechanism——Here mainly refers to token rewards based on metaverse land space interactions. For example, Cryptovoxels announced that it will launch BOOP tokens in April 2022 and distribute BOOP airdrop rewards according to the number of visitors on the user’s land at a ratio of 1:1. Dozens of events are being held; NFT Worlds' floor price has risen sharply due to the pledged land mining mechanism. The income mechanism of metaverse assets is a key factor in determining the price of land.
Number of cooperation IPs——More and more traditional companies, big IP concerns and metaverse platforms are cooperating. Most of them will buy land for construction and plan to hold metaverse activities. This will often bring out the circle effect and greatly enhance the popularity of the project. Raise land prices in a short period of time.
user friendliness——Platforms with low requirements for end-user access devices have more traffic advantages. For example, Decentraland currently only supports login on the PC side. It is best to use a notebook with a discrete graphics card or a high-end desktop to play freely. However, Cryptovoxels can be accessed by ordinary notebooks and mobile phones. Obviously, the latter is more user-friendly.
scene experience——For real metaverse users, the immersive experience in virtual reality is the most important. This mainly depends on the richness of the scene construction of the project and the sense of realistic experience. On the one hand, the richer the scene construction is, the more fun tourists can experience in it. On the other hand, a realistic experience is inseparable from a faster screen display speed. Display delays or disconnections will greatly reduce our experience. At the same time, the 3D stereoscopic style of Decentraland is smoother than the voxel style of Cryptovoxels. lifelike.
There are many similarities between metaverse real estate and real estate in real life. The main factors that determine the land price in the same project are the area and height of the plot, and the geographical location. Specifically:
Plot size and height——In projects with different land sizes, the land valuation follows a principle similar to that of real estate in the real world. The land area and building height can determine the scale of the building site above it, which is an important factor in determining the land price.
geographic location——Touring and exploring is a great pleasure for users in the Metaverse space, which is similar to shopping in real life. After people arrive at their destination, they are often interested in exploring the surrounding buildings. Therefore, the land near the traffic gathering place can often get the overflow traffic of tourists. The closer to the center of the world or the densely built area, the higher the price of the land. For example, in Decentraland and Cryptovoxels, users enter from the center of the world (origin) to start their tours, which naturally becomes the largest traffic gathering place on the platform, and the surrounding land prices will be relatively high. In the same way, the surrounding area environment and the construction of adjacent plots are also more important, and the plots near the big IP have geographical advantages.
When purchasing metaverse land NFT, you can first filter out better projects based on the above dimensions, according to the total amount of land, revenue mechanism and platform traffic (user friendliness, number of IP cooperation, richness of scene construction), and then select from among them according to personal needs Plots with a suitable height and a better location. Of course, the above is only an evaluation of the land value. After becoming a land owner, you will have more choices. Not only can you become an ecological builder to build your favorite buildings to display your NFT products, but you can also use the land as a means of production to earn Income, such as leasing land or buildings, accepting advertising business, etc.
A qualified Metaverse platform needs to meet the requirements of a virtual identity, realistic social experience, extremely low latency, diverse content, a complete economic system, and security and stability. In the next few years, with the advancement of technology, there will be more models of metaverse platforms launched, but those metaverses with high-quality content, better revenue mechanisms, and user experience-centric metaverses will be easier to stand out from the encirclement, and will eventually It has strong user stickiness and land asset appreciation momentum. In this meaningful, interesting, and traffic-rich new world, the leading metaverse projects will further gather traffic and attract more brands to settle in.
