Tokens.com CEO buys $2 million worth of land from Decentraland

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An avatar making its way through the Decentraland metaverse platform

The metaverse mogul behind a record investment in virtual lands is about to begin development.

Tokens.com paid more than $2 million for space in Decentraland, one of the metaverse’s many burgeoning platforms, in November last year.

In an interview, Tokens.com co-founder and CEO Andrew Kiguel said “several big names are set to be part of an online fashion show” on the virtual storyline. Kiguel said fashion brands Tommy Hilfiger, Cavalli, Elie Saab, Dolce & Gabbana, Etro and perfume company Paco Rabanne have all signed up to participate starting March 24. The show will take place over three days. There will also be several renowned DJs and an after party sponsored by Mercedes-Benz.

Kiguel describes Decentraland, one of the platforms his company focuses on, as a different type of NFT, or non-fungible token. Anyone can buy virtual land on the platform. In the case of Decentraland, you must use a form of digital currency called MANNA, which can only be purchased with Bitcoin or Ethereum.

Users can then go to the site to see what is for sale. The packages have already been purchased, but many are available second-hand. The price fluctuates just like real estate in the physical world.

As for the purchase in November by Kiguel of land in Decentraland, his team is closely monitoring the transactions. They knew who owned what and where they wanted to buy. The transaction was recorded on a blockchain, which acts as a digital document in the metaverse.

There is no infinite space on metaverse platforms. Worlds have beginnings and endings. Kiguel compares it to a Monopoly board.

An image inside Decentraland, a metaverse platform

Tokens.com

“Decentraland has 45,000 properties you can buy, 45,000 little pixels,” he said. “There are actually 90,000 pixels on the board but some of them are not for sale like the lakes, rivers, trees, fountains in the city center, those are the areas that are kept by the foundation for beautification purposes.”

The creators of Decentraland wrote code that doesn’t allow expansion in their metaverse, so land is in limited supply, just like in the real world.

What makes the land more valuable? In most cases, the proximity of something else with heavy traffic. In the metaverse, you click to get somewhere. You don’t have to walk, drive, fly or take the subway. Kiguel explains it like this: “The museum district has a whole bunch of NFTs and stuff on display, so when you walk around it’s kind of like you’re in a city, you see a building here, you see something something else there.”

There are also amusement parks and other attractions, designed to draw people and their digital representatives, called avatars, into action. It is believed that these avatars will use cash or cryptocurrencies to purchase goods online. Some of these goods may have value in the real physical world. Others may just be for avatars who want to have the latest metaverse fashions like virtual hats, shoes, and shirts.

While Decentraland’s platform is purely fictional, another key idea in the Metaverse combines the real world with the virtual. Hrish Lotlikar, co-founder and CEO of SuperWorld, has designed a system that takes up space in the physical world and allows users to purchase the virtual equivalent within blocks.

Lotlikar describes his metaverse as “being built on top of the real world”. The blocks sell for an initial price of $390, but the value increases or decreases on the second market. SuperWorld aims to have real-world utility allowing users to leave NFTs, holograms, or messages on the platform that people might find if they visited the real-world equivalent in those blocks. Among other things, these messages are then displayed on a user’s phone when they enter a location, such as a restaurant, designed to house the message.

“When you buy land, what you buy is a non-fungible token,” Lotlikar said in an interview earlier this month. “You are buying a digital asset that allows you to earn a share of any savings that have occurred on that parcel of land.”

SuperWorld makes money by taking a 10% discount on all transactions made on anyone’s property and taking an additional 10% when the land changes hands in a sale.

An image of what the SuperWorld metaverse platform looks like to users

SuperWorld

Despite all the recent hype and sudden growth, the concept of a metaverse is nothing new. For example, the Second Life site has been entertaining and offering online commerce for nearly 20 years.

Brad Oberwager, executive chairman of Linden Labs, owner of Second Life, told CNBC in a recent interview, “the metaverse is not a game, you don’t play in Second Life, you reside in it.” Oberwager criticized price volatility in new metaverse sites, saying that “if the value of the house I’m renting went up and down 50% in one day, I couldn’t live like this.”

In Second Life, customers rent land and build on it. Oberwager says Second Life is now a real saving of $650 million.

The company also hopes to launch a payment system that it hopes will become the bank of the metaverse allowing customers an easier way to transfer money across virtual economies.

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