Johnny McCamley has spent almost £5,000 on land.
But he cannot physically enter this land – and he cannot live there or build a house on it.
That’s because the 23-year-old has invested in the Metaverse, meaning his country is entirely virtual and exists solely in a digital world.
Mr. McCamley from Belfast is one of many people who have decided to buy virtual property in the metaverse.
Virtual land transactions on The Sandbox, the largest digital property platform, hit $350 million (£267 million) last year, according to a report by the Center for Finance, Technology and Entrepreneurship.
Another $110m (£84.2m) worth of transactions were made on Decentraland, the second largest Metaverse platform.
Image: The Metaverse allows users to interact with others, play games, build art galleries and businesses. Image: Johnny McCamley
What is the metaverse?
The Metaverse is not a single digital space. It is a network of virtual reality worlds set up by companies and platforms where users can interact, play games, attend events and buy land.
A better known metaverse is Horizon Worlds. It was developed by Facebook, which has now changed its name to Meta as the tech giant shifts its focus to virtual spaces.
Other brands have also announced their own digital worlds.
Manchester City are planning to build the first Metaverse football stadium in partnership with Sony.
Mr. McCamley, the CEO of CryptoClear, bought his property in The Sandbox last October. He said: “There are casinos in the Metaverse, there are also museums, but there are also events like podcasts and also conferences that I’ve actually attended. So, the best way to look at it is, it’s taking the real world and really digitizing it way beyond zoom.”
Image: Facebook was rebranded to Meta in October 2021
Why do people buy virtual property?
For Mr McCamley, the chance to claim in this imaginary world was an opportunity not to be missed, although market uncertainty and price volatility make it a risky investment.
“It’s like any new investment, any new asset class. When I got into bitcoin when it was $300 I was told it was extremely risky, the same goes for ether at $4. I think getting a piece of land in Decentraland for $4,000 is an absolute must bargain,” he said.
He intends to hold his purchase for 10 years: “I believe the Metaverse will mature in about a decade and I will consider selling the land when that time comes.”
Landowners can also use their virtual spaces to create experiences for others to enjoy.
“The lots owned by the community are my favourites. A really, really good example is, I think it’s a ‘gecko beach’ that someone made, which as you can imagine is a beach full of geckos,” said Mr McCamley.
Image: Johnny McCamley from Belfast owns three plots of virtual land in the Metaverse
Search for a home in the virtual world
The search for the perfect home in the metaverse is similar to real life.
Plots next to roads and near desirable districts such as “fashion” or “museum” areas will have a higher price and are more attractive investment opportunities.
In The Sandbox, busier central areas near other attractions are much more expensive than newer neighborhoods on the outskirts.
Who your neighbors are also affects the value of your property.
In September 2021, rapper Snoop Dogg announced his own digital “Snoopverse” in The Sandbox.
Two months later, a plot of land adjacent to his property was sold for over $450,000 (£350,000).
Unlike traditional real estate buying, however, there is no third party or legal presence that can ensure deals are legitimate.
This can be risky when buying on a secondary market like OpenSea, where cryptocurrency purchases are made.
Image: “Meta-Architects” help to design interactive virtual spaces for people and companies
Why do people build virtual real estate?
In addition to property owners, there is a new generation of “meta-architects” who design virtual spaces.
Stavros Zachariades is a traditional architect working in south London but began designing for the digital world during the pandemic after his brother Adonis founded Renovi, an NFT marketplace.
The 37-year-old recently designed pop-up shops for Metaverse Fashion Week.
“The attraction of the metaverse and the building in the metaverse is [people and businesses] show what it’s all about,” said Mr. Zachariades.
“They can show their products. We can offer gathering spaces for different people, especially now with COVID and the last two years people have been more remote.
“You can have floating buildings from the realms of super sci-fi that spin and transform – and on the other side of the realm, historical, classic architectural styles.”
He believes the metaverse could open doors for those who lack connectivity in real life: “I’ve been thinking about how accessibility can change, for example someone who doesn’t have the same mobility can have equal rights in the metaverse . Why not? “
Image: With the increasing demand for virtual real estate, “meta-architects” are stepping forward to help design interactive digital spaces. Image: Stavros Zachariades
“It’s just impossible to know what the endgame is”
But many warn that these investments could fail.
Birmingham-based YouTuber Mitch Investing regularly covers topics such as personal finance and new technologies on his channel.
He thinks the promises that the metaverse will become part of our everyday lives are exaggerated.
“It’s so early in its development, it’s like investing in a company that’s only been around for a year. Not sure if it’s going to take off or not, not sure where the business is going, not too sure how the business model is going to pan out…it’s highly speculative from my point of view,” said the 26- year olds.
There is concern that not all virtual worlds will succeed in attracting a large enough number of users.
“There could be thousands of metaverses like there are websites today. It’s just impossible to know what the endgame is,” he warned.
Image: YouTuber Mitch Investing believes buying virtual property is a risky investment strategy
risk and volatility
The Financial Conduct Authority has labeled cryptoassets as “very risky, speculative investments” and warned that people who trade them should be prepared to lose all their money.
There are also broader security concerns for users regarding online harm.
The newly launched Online Safety Bill will address activity in the Metaverse, requiring companies to take action when fraud is committed by their users, including those in virtual reality spaces.