What Is Virtual Land and Why Are People Buying It

With the advent of Metaverse, the real estate market has been making a crucial shift. That’s because you can now buy digital pieces of land in the virtual world, and doing so holds a surprising amount of value.

This acquired land is actually a NFT that belongs to you, proving your ownership as each one is unique and has a different digital signature. But what makes it such a big deal, and how can you get your own piece of land in the Metaverse? These are the questions we will be answering in this article.

Also read:What Is a Non-Fungible Token?

What is Virtual Land?

If you ever played a free-roam game like GTA, then you can probably remember how being immersed into an alternative world that, even though it only existed inside your computer, felt so real. Well, dealing with virtual land can be very similar to GTA in a lot of ways. Just like in the game, it’s possible to control your avatar and go to the barber for a haircut. Or you could visit an arcade and play mini-games. The possibilities are endless.

The big difference here is that, unlike GTA, the avatars you see roaming around the Metaverse are actually manifestation of real-world individuals instead of bots. In fact, even the stores here are run by real people. And just like in the real world, they first have to buy a piece of “virtual land” before setting up their virtual business.

Now here’s the catch. When buying goods from a shop, customers will have to pay using real-world cash in the form of cryptocurrencies. All in all, virtual land is basically a digital game-like construction that is very closely connected to its real-world counterparts.

Now you must be thinking, if you own virtual land, how does one verify the land ownership here? Is there a notary office? Well, the entire virtual land ecosystem is based on a blockchain, and each piece of land is an NFT. Now, similarly to normal NFTs, your virtual plot of land also has a tangible address. It’s also secured by a smart contract that gives you the sole ownership of that particular piece of property.

Also read:How to Make Your First NFT

Are People Actually Buying Virtual Land?

There are plenty of reasons why regular folks, as well as corporations, are getting on board with this new fad. The Metaverse has revolutionized the way people attend online events, and, in the process, has also created opportunities for virtual land owners to make extra revenue. For instance, people can now rent out their digital property or sell it to interested buyers and make huge profits without even leaving their living room. With some virtual plots of land going for sale for as high as $2.4m, many people are getting excited about the potential gains.

Virtual lands are a part of the NFT space which has been exponentially appreciating in value. Naturally, the budding market has caught the attention of many investors. Some of who are planning long-term while others are seeking to make quick returns. Based on the rising interest and a massive market cap already exceeding billions of dollars, future prospects are encouraging.

Another reason why virtual land space is getting further attention is its lower entry barrier. While real estate in the real world can have massive prices, anyone can buy an entry-level piece of virtual land for only a few hundred dollars. Not to mention how easy it is to buy virtual land as it does not require any paper and does not involve paying taxes. You don’t even need to maintain it, yet you can rent it out just as you would rent out physical land.

All in all, this lower entry barrier, the potential for solid returns, and ease of access mixed with a pinch of FOMO (Fear of missing out) have pushed virtual land sales to new heights.

Also read:7 of the Best Cryptocurrency Tracker Apps for Android

How to Buy Virtual Land

Buying virtual land is very similar to buying an NFT. Here’s how you can get started in a few easy steps:

1. Set Up a Crypto Wallet

You must first create a wallet that will allow you to access the crypto tokens in your possession. You can either choose a mobile wallet or a web-based wallet. However, it’s best to go for an Ethereum wallet as most NFT land sales accept ETH.

We recommend using the Metamask wallet, which is quite easy to set up, as seen bellow.

1. Go to the official Metamask website and download their wallet. You can download the Metamask wallet as a browser extension or its mobile app for both iOS and Android.

2. Add the extension to your browser.

3. Once you’ve enabled the Metamask wallet extension, a new tab will open on your browser.
4. Click on “Get Started” to proceed.

5. If you already have a Metamask wallet, you can log into it using a recovery phase. But since we’re creating a new wallet, click on “Create a wallet”.

6. Once you’ve read the terms of the agreement, you can go ahead and agree to them.

7. Now, create a small password for your wallet and click on “Create”.

And with that, you have successfully created your Metamask wallet.

Also read:How to Earn Cryptocurrency by Browsing the Web

2. Select Your Virtual Estate Platform

Before you go ahead and buy land on a Metaverse, you need to be choosing which one you want to invest in. Your choices may vary depending on the kind of use you are planning for your land.

You might head to popular metaverses like The Sandbox or Decentraland if you are looking to host online events and concerts. Alternatively, Cryptovoxel might be best suited for your need if your goal is to display your NFT collection and meet new creative individuals.

Once you set your sights on a particular plot, you’ll be able to acquire them via one of the more popular marketplaces such as OpenSea.

3. Choose a Virtual Plot of Land

Once you’ve chosen a platform to invest in, it all comes down to selecting a piece of virtual plot and purchasing it. But how to know which piece of land is worth taking the risk? Here are some pointers you should keep in mind, as you consider buying:

• Start small – If you’re not sure whether the piece of virtual land you want to buy will yield profit in the future, you can start by taking smaller risks. For example, you can go for cheaper plots of land, like the ones on Earth2 to help you get accustomed to the whole idea of digital real estate. Once you’re confident enough and have enough knowledge to make your own decisions, you can invest in “high-risk, high-reward” pieces of land as well.

• Verify legitimacy – whichever Metaverse platform you end you choosing, you should do some research on it in advance. Make sure you’re not dealing NFT scam, so that you can protect your investment. A good way to figure if the virtual land you’re planning to buy is legit is to look whether celebrities, influencers, or other reputable investors have invested in the platform selling it.
• Don’t share your digital wallet’s “seed phrase” – Your digital crypto wallet is secured by a randomly generated chain of words that allows you to access your tokens in the wallet. This chain is called “seed phrase,” and no matter what you do, you should never share it with any Metaverse platform. Even if they ask you for it during signup. Otherwise, you’ll be risking your funds stored in your wallet.

Also read:What You Need to Know About Cryptocurrency Hardware Wallets

4. Make the Payment

To buy or even bid on the land, you’ll need Ether (ETH) or a metaverse-specific coin like SAND or MANA in your wallet. Buying ETH can be advantageous because most NFT land sales accept cryptocurrency.

Follow the steps mentioned below to get the payment process started for the virtual land plot you’ve chosen.

1. Select a piece of land you want to buy.

Note: The land cost will depend on the number of people being nearby or the popularity of the spot.

2. Click on the crypto wallet you want to connect with the NFT marketplace.

3. Give permissions to the marketplace to access your wallet.

4. Select the wallet account you want to connect, then click “Next”.

5. After your wallet is connected, click on the “Make offer” button.

6. Fill in the amount you want to offer for the land, set an expiration date, agree to terms and conditions, and click on “Make Offer”.

If your offer is accepted, the funds will be deducted from your wallet after your confirmation, and the land’s ownership will be transferred to your wallet address.

Also read:7 of the Best Metaverse Games You Can Play Right Now

How to Monetize Your Virtual Land

Now that you finally purchased your first plot of land in the Metaverse, here’s a few ideas that will help you start making profits from your investment.

1. Host Virtual Parties

The Metaverse is all about using your avatar to explore. For example, you could attend virtual parties and concerts hosted by other people. Even better, you might actually use your virtual property and host these sorts of parties yourself.

You could also attempt to invite some celebrities and give people the chance to interact with them in a much more relaxed setting. It is, however, necessary to be the owner of the land in order to host such events.

In this scenario, you’ll be able to generate some revenue by charging an entry fee to attend your virtual concert or party.

2. Open Virtual Stores and Showcase NFT Collections

Virtual stores may very well be the future of the e-commerce industry. Businesses can set up virtual stores on the land that they own in the Metaverse, and use a combination of AR, VR, and 3D technology to give users a comprehensive shopping experience. This is already being done by many reputable brands with their stores on metaverses, namely brands like Adidas, Mattel, Oculus, and more.

You could also use your virtual land to display your NFT collection as you would in an art gallery. This all in the hopes that someone will appreciate your work and will want to acquire some of your pieces.

Also read:Hardware You Need to Be Ready For Virtual Reality

3. Rent or Lease Out Your Land

If you happen to have gotten your hands on virtual land in a popular area, you can set up a handsome income source from renting out the land to people for hosting events, concerts, community meetups, or conferences.

You could also theoretically buy a lot of properties and begin a real estate business in the virtual world, leasing properties to people looking for opportunities in the Metaverse but lacking the funds to create a solid stronghold.

4. Sell Ad Space

Advertisement in the virtual world is poised to take the marketing industry by storm. The opportunities for marketing in a virtual world are so vast that they can add entirely new dimensions to the experience offered by a brand.

While you could obviously place billboards on your land, the possibilities go further. For example, the Japanese toy giant Hasbro partnered with Roblox to bring nerf guns to the Metaverse. That’s not all. Even the big fashion labels like Gucci created an entirely Gucci-themed world for their customers, where everything can be bought as an NFT.

5. Land Flipping

Of course, where there is a market, there are going to be traders and resellers. You could diversify your portfolio by buying lands in various different places, hype them up online so that when prices go up, you could sell them with a significant increase.

There is obviously a significant amount of luck involved in flipping a property for profit, but if done right, it can be a lucrative business.

We can see the vast amount of possibilities other than the material appeal of virtual land. This is actually why many top investors are rushing to secure their places early in this emerging market.

Also read:How to Enable Two-factor Authentication (2FA) in Fortnite and All Epic Games

Frequently Asked Questions

Do I have to pay a capital gain tax on virtual land?

No, you do not need to pay any capital gain tax on the sale of virtual lands as they exist in a decentralized economy. However, ultimately a piece of virtual land is an NFT, and you might have to pay some tax on any profit that you make from the sale of a virtual digital asset, depending on the country you live in.

How can I rent virtual land?

Since there are no real estate agents in the metaverse, to rent a virtual land you need to contact the land owner directly. You can do that by browsing through marketplaces like Metaverse.Properties or you can post your requirements in niche communities.

What does it take to create an event in the Metaverse?

The first thing you need is to own a virtual patch of land. Once that part is covered, you can move on to things like finding an appropriate theme for your party. After you’ve got that sorted out, you can start decorating your venue accordingly. With a little marketing you can start attracting attendees. You can post your event details in the community chats, social media, or even run ads for it. Bonus points for you if you can get a celebrity or even influencers to attend your function as special guests as you can leverage their presence in your marketing campaign.

Image credit: Freepik All screenshots by Ojash Yadav

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