Looks like the metaverse craze has died down. The value of cryptocurrencies has fallen significantly in recent months, impacting the metaverse economy, resulting in a decrease in the value of virtual land. According to media reports The information Within five months, the average price of one parcel decreased by more than 66%. NFT Worlds, ranked third in the metaverse, sees its average land price drop to $2,328. in March it was 18,095. “The entire cryptocurrency universe retreats from the November 2021 peak“, says economist Christophe Barro. “MANA and SAND currencies, which enable transactions in Decentraland and The Sandbox metaversions, cost significantly less.“. The former lost two-thirds of its value, the latter three-quarters.
“In the metaverse, the real estate boom is turning into a meltdown»
Another phenomenon that explains the bursting of the metaverse real estate bubble is that many landowners want to make a short-term profit. They rush to resell their gains (within about 6 months in The Sandbox). Speculators have multiplied since the emergence of these virtual worlds, which had low supply and high demand. The overvaluation of some plots of land has caused investor fatigue. Real estate sales have almost dried up. From November 2021 to June 2022, the number of transactions in Decentraland and The Sandbox decreased by 97%, according to WeMeta market analysis. At the peak of November 2021, 16,000 property sales per day were recorded in the metaverse. Last June it was just 2,000.
Still too young a virtual society
“Like many new phenomena, people followed a fad and bought anything and everything“, says the economist. “Buyers today look more closely at projects, they seek to own assets and find added value to be created. But when you get into cryptos and see things go down, it doesn’t encourage you to keep going “.
Speculation appears to be winding down today, with large investors holding back their shares.“Big companies like Carrefour, which were looking for a marketing effect, will wait for some enthusiasm to return;“. Christophe Barro is positive about the future of the Internet market3. “We are in the process of consolidating these new virtual markets. It is still a young and uncertain phenomenon for many, which scares some investors. You have to be patient so that the market reaches a certain maturity. Many projects and alternatives to large metaverses will be born, and competition will balance things out“. If prices are attractive to new buyers, we should be wary of prolonging this bad dynamic.
Source: Le Figaro
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.