JJ Lin's Metaverse has a 91% loss, and "real estate" speculation is receding

The most suffocating task for workers in the 21st century is "housing loans". Housing prices have been hyped to far greater than the value of the product itself, but only houses can meet people's housing needs. If assets in the real economy are measured as "worthless", then assets in the virtual world = "bubble"?

Billionaire Mark Cuban said, "It is a very stupid idea to buy real estate in the metaverse. " In his opinion, in the real world, real estate is valuable because land in reality is a scarce resource, "but this scarce attribute may not apply to the metaverse."

JJ Lin's virtual real estate suffered a 91% loss

In November 2021, according to the Securities Times, a piece of virtual land on the virtual gaming platform Sandbox was sold for US$4.3 million, setting a new record for real estate transaction prices in the "Metaverse", breaking the previous record of US$2.43 million set by a piece of virtual land on Decentraland, and the "house speculation" in the Metaverse became a hot topic.

At almost the same time, singer JJ Lin posted a message saying that he spent 123,000 US dollars (about 780,000 RMB) to buy three pieces of land on Decentraland, which is equivalent to 784,000 RMB. It is understood that this virtual land can be built into any shape according to the player's preferences, and may even be sold in the future. This once again pushed virtual real estate to a climax.

Before this piece of "land" could start to take off, yesterday (April 9), JJ Lin and his "real estate" became a hot topic on Weibo: the three pieces of virtual real estate he bought from Decentraland, the world's largest metaverse real estate sales platform, for $123,000 are currently worth only about $10,000 (RMB 68,000), with a floating loss of 91%.

In addition to the plummeting prices, according to the weekly visit volume provided by the platform, these three plots of land were almost ignored.

JJ Lin has always been very involved in virtual assets. In January this year, SMG, a trendy lifestyle brand founded by JJ Lin, jointly issued mecha NFT with Graycraft.

On April 9, JJ Lin posted on his personal Weibo, "I heard that a lot of people want to help me manage my finances recently," and attached a picture of a "wallet", apparently in response to the incident.

Digital world trend

In addition to JJ Lin, many other celebrities including Jay Chou, Lu Han, Shawn Yue, and Xu Jinglei have been swept up in this wave of "Metaverse" trend, purchasing real estate or NFT avatars in the Metaverse, or issuing their own NFTs.

In January this year, the metaverse platform Ezek and Jay Chou's fashion brand PHANTACi launched the first limited-edition NFT project Phanta Bear. Within 40 minutes of the start of sale, 10,000 Phantasm Bears were sold out, causing the platform system to freeze for a while, and ultimately setting a total transaction amount estimated at 62 million yuan.

It is worth mentioning that in order to support the official sale of NFT, Jay Chou and Hannah Quinlivan also posted Phanta Bear NFT images on social platforms, saying "Change your avatar and feel the feeling of the metaverse." Recent data shows that Phanta Bear has also experienced a sharp drop in price.

Image source: Instagram

In October 2021, the domestic metaverse product "Rainbow Universe" was internally tested (this is a 3D virtual social platform based on blockchain technology). At its peak, the top virtual land "SS-level island" of Rainbow Universe was listed on the Xianyu APP for 1 million yuan, and the transaction price was more than 100,000 yuan.

The “digital asset” craze is receding

This wave of virtual world retreat is long overdue.

As early as a year ago, after Facebook changed its name to Meta Platforms and focused on the Metaverse, Meta's long-term shareholder Altimeter Capital called on the company to cut wage costs by at least 20% and limit annual Metaverse spending to US$5 billion.

Meta has lost focus and its stock has lagged behind its peers, he wrote in a blog post.

Data shows that Altimeter Capital holds 2.5 million shares of Meta, accounting for 0.11% of the outstanding shares. Meta has fallen 61% this year, while the Nasdaq 100 index has fallen 30%.

Meta announced in November last year that it would lay off more than 11,000 employees, accounting for about 13% of its total employees. This is also the largest layoff since its establishment in 2004.

Coincidentally, with the arrival of AIGC, the popularity of Metaverse has dropped sharply. Recently, ByteDance and Tencent have successively made adjustments to Metaverse business, changing business development paths or reducing staffing.

According to The Paper, on February 16, Tencent Games' XR (extended reality) business will change its development path, adjust the development route of self-developed hardware, and optimize related organizations and positions within the business line. At the same time, PICO, a VR manufacturer under ByteDance, laid off about 20%-30% of its employees.

Are assets in the virtual world equivalent to a “bubble”?

In fact, this is not the case. The metaverse industry is still in its infancy, and the sudden rise or fall in popularity under new concepts is also expected. It is undoubtedly universal to treat emerging things objectively and rationally. Do not over-praise them or completely deny them.

In today's market economy, the positive impact of digital culture on product promotion is unquestionable. For celebrities who have their own traffic, linking with the "metaverse + real industry" industry is a beneficial thing to promote economic development.