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Are we in metaverse yet?

In the metaverse, real estate is a virtual ecosystem, where technologies such as virtual reality, and augmented reality, seamlessly come together to create a real-world user experience

In 1992 Neal Stephenson’s sci-fi classic Snow Crash coined the term ‘metaverse’. The protagonist in the show wears a headset to escape reality and enter a virtual space where avatars stroll the streets, digital shops line the pavements and electronic currencies rule the roost.

After 30 years that vision is close to becoming reality. In October 2021, Mark Zuckerberg announced a plan to bring metaverse into life. He re-branded Facebook as ‘Meta’ and invested $10 billion in virtual space.

With this, several companies, including Apple and Microsoft are betting that the world of tomorrow will be carried out in the metaverse. Even Microsoft has recently acquired the video game giant Activision Blizzard for the US $68.7 billion.

Fashion brands like Nike, and Gucci are designing clothes and accessories for the metaverse. J.P. Morgan and Samsung have set up shop in Decentraland, a decentralized virtual reality platform. In the metaverse, people can operate their own Forever 21 stores and even sell their own designs.

There are some popular books that explain to people more about the metaverse. Books like Navigating the Metaverse, by Cathy Hackl, Dirk Lueth, and Tommaso Di Bartolo; The Metaverse Handbook, by QuHarrison Terry and Scott Keeney; and Step into the Metaverse, by Mark van Rijmenam, all set themselves up as Lonely Planet guides to the digital frontier.

Van Rijmenam a tech strategist says, “We are currently spending astronomical amounts of money to make our cities more liveable, equitable, and sustainable, but what good are these investments if the citizens of tomorrow will only experience the city virtually?”.

According to Rijmenam, many urban attractions such as cinemas, restaurants, museums, and historical monuments will see a drop in the number of customers. Now, it is possible to visit several museums virtually, he added.

As the metaverse grows, it will need more money, land, and infrastructure to house the computer servers it runs on. Although the experiences are virtual, their costs — in terms of money, energy, and environment — are real and increasing.

According to Rijmenam, in the coming years, other social activities such as enjoying a coffee or a beer with friends may also take place online. “Not only will these virtual meetings eliminate the constraints of distance, reducing our use of urban transport, but they will also allow us to choose a location for a meeting anywhere on the planet”, Rijmenam said.

Visualizing Real Estate in Metaverse
In the metaverse, real estate is a virtual ecosystem, where technologies such as virtual reality, and augmented reality, seamlessly come together to create a real-world user experience. There are unique and non-replicable land parcels available. Visiting and creating a virtual landscape, conducting virtual events, and purchasing properties are opening new possibilities for real estate. According to a leading Analytics firm, real estate sales on major metaverse platforms reached $501 million in 2021 and are expected to double in 2022.

Users can claim ownership of a parcel of virtual land-based on blockchain ledgers. The landowners will have complete control over how virtual land is utilized on their land which is identifiable by a set of geographic coordinates to locate the property.

The most popular metaverse environments also known as the Big 4 are Sandbox, Decentraland, Cryptovoxel, and Somnium. These four platforms together have a combined 268, 645 parcels of land. Land prices in Metaverse have risen by as much as 500% as of March 2022.

Transaction and ownership of land on metaverse can be done using cryptocurrency. For this, users can create an account on any of the crypto wallets such as Metamask, Bitski or Arkane. The actual token currency where the transaction takes place depends on the metaverse environment.

Several large companies have jumped onto the metaverse bandwagon. For instance, global consulting company PwC’s Hong Kong wing has purchased a land parcel in a metaverse space where it intends to construct a Web 3.0 advisory hub to facilitate a new generation of professional services. Sporting goods giant Adidas also aims to market exclusive branded content, experience, and merchandise in the metaverse.

South Korean mobile manufacturer Samsung recently launched its metaverse location design basis at its store location in New York named Samsung 837 store. In addition to this, popular music artists Snoop Dogg, Imagine Dragons, and BTS have conducted virtual concerts in the metaverse.

Investing in Metaverse
Real estate investors are exploring ways to incorporate real estate in the metaverse as an asset class in their investment portfolio. With low barriers of entry, metaverse allows a wider pool of investors with virtual land parcels available at various price points. Land on metaverse is also being bought by large brands looking to create an experiential center to showcase their products.

Also, there are several Indian investors who are reimagining real estate in the virtual world. For instance, Lepasa, which is a web 3.0 metaverse ecosystem, is creating 15-20 virtual cities, with each town having a different theme.

Developing in Metaverse
Real estate developers can also explore opportunities arising from the metaverse. Metaverse with its immersive landscape could one day be used to solve complex engineering challenges by providing a collaborative landscape for architects, engineers, and project managers to seamlessly interact and come up with solutions to real-world problems.

Unity, a cross-platform game engine developed by Unity Technologies can be used to create a virtual model on metaverse. This virtual model could then be used as the reference model for the actual construction of the building.

Metaverse is at its earliest stage, currently used for gaming and virtual events, and could soon have the capability to solve real-world problems. With greater penetration of 5G technology and global brands investing, the metaverse landscape is expected to gain greater acceptability in the near future.

How do NFTs fit into the metaverse?
Non Fungible Tokens (NFTs) figure to play a big role in the usefulness and popularity of the metaverse. NFTs are a secure type of digital asset based on the same blockchain technology used by cryptocurrency. Instead of currency, an NFT can represent a piece of art, a song, or digital real estate. An NFT gives the owner a kind of digital deed or proof of ownership that can be bought or sold in the metaverse.

Metaverse Properties bills itself as the world’s first virtual real estate company. The company acts as an agent to facilitate the purchase or rental of property or land in several metaverse virtual worlds — including Decentraland, Sandbox, Somnium, and Upland. Offerings include conference and commercial spaces, art galleries, family homes, and “hangout spots.”

While the metaverse has created opportunities for new companies such as Metaverse Properties to offer digital goods, established brick-and-mortar companies are also jumping in. For example, Nike acquired RTFKT — a startup that makes one-of-a-kind virtual sneakers and digital artifacts using NFTs, blockchain authentication, and augmented reality. On its website, RTFKT said it was “born on the metaverse, and this has defined its feel to this day.”

Prior to the acquisition, Nike filed seven trademark applications to help create and sell virtual sneakers and apparel. Nike and Roblox also partnered on “Nikeland,” a digital world where Nike fans can play games, connect and dress their avatars in virtual apparel.

Nick Donarski, CEO of ORE System, an online community of gamers said that NFTs and blockchain lay the groundwork for digital ownership, content creators and game developers. Ownership of one’s real-world identity will carry over to the metaverse, and NFTs will be this vehicle, he added.

How close is the metaverse?
While the basic idea of being able to engage in a virtual online world has been around for many years, a true metaverse where life-like interactions are possible is still years away. In his annual year in a review blog post, Microsoft co-founder Bill Gates noted that most people don’t have the VR goggles and motion capture gloves to accurately capture their expression, body language, and quality of their voice.

But for business, Gates predicts that in the next two to three years most virtual meetings will move from two-dimensional square boxes to the metaverse — a 3D space with participants appearing as digital avatars.

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