Virtual real estate prices have collapsed by 90% in the last fourteen months, journalists have calculated
The virtual real estate market in Decentaland and The Sandbox is in crisis amid falling cryptocurrency prices and a lack of interest among investors.
The Australian Financial Review newspaper, which calculated the statistics for the last fourteen months, wrote about it.
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According to the WeMeta site, the median price tag for virtual land in the two aforementioned projects fell over the year from $5291 to $1951 on Decentraland and from $3538 to $741 on The Sandbox. Zeb Rice.
A partner at venture capital firm King River Capital, told the publication that from an investment point of view, meta-universes are of no interest to venture capital firms.
He noted that far more activity can be found in cryptocurrency projects than in empty virtual worlds.
Partner at another venture capital firm, Bitkraft Ventures, Nicholas Viricki, believes speculators are to blame.
In his opinion, they were the ones who flooded virtual spaces with money, expecting a quick return on investment. In doing so, they do nothing to directly build on the virtual sites themselves, Viriki noted.
“They [the speculators] are just waiting for the meta universe to take off without doing anything.. From the outside, it was a pretty terrible investment,” he added.
Higher entry thresholds also play against cryptocurrency metaprojects. As Viriki admits, existing blockchain games are nowhere near as good as video games like Roblox or Fornite.
He stressed that, so far, centralized projects are many times better at satisfying consumer needs than their decentralized counterparts.
The decentraland (MANA) and sandbox (SAND) tokens also collapsed as interest in virtual worlds declined.
The decentraland (MANA) and the sandbox (SAND) tokens also collapsed as interest in virtual worlds declined.
Since February 2022, the rates of both tokens have collapsed by more than 80%, notes the publication.
The market capitalization of projects is also falling rapidly. While Decentraland’s market capitalization was above $1.2 billion last year, as of April 2023 it had dropped below $220 million.
In the case of The Sandbox it dropped from $554 million to $131 million.