Fancy bubble? Cryptocurrency investors begin to speculate on "virtual NFT real estate"

Cryptocurrency investors are starting a new activity: investing in virtual blockchain assets including NFT real estate. Since the beginning of this year, the concept of NFT (non-fungible token) has received a lot of market attention. A large number of NFT paintings and audios have been hyped up to incredibly high prices.

The operation of NFT is not complicated. If an artist wants to sell his work, he can upload it to the blockchain platform, conduct digital asset authentication and convert it into NFT, and generate a code, which can record the source, price, resale and other information of the work.

MetaKovan, founder of NFT fund Metapurse, purchased the NFT digital artwork "Everyday: The First 5000 Days" by American artist Beeple at Christie's for US$69 million last month, causing a sensation in the market.

But NFT virtual artworks are just the iceberg of this blockchain virtual world, in which land, buildings, avatars and even names can be bought and sold as NFT assets. In these environments, called metaverses, people can hang out with friends, visit virtual buildings and attend virtual events.

Virtual real estate prices are hitting new highs on blockchain-powered decentralized VR platforms like Decentraland, Cryptovoxels, Somnium Space, and The Sandbox.

Currently, the total transaction volume of Decentraland has exceeded 50 million US dollars, and the transaction scope includes virtual land, virtual characters, user names, virtual clothing and other wearable devices.

In the world built by Decentraland, users can create, experience, and monetize what they build and what they own.

On April 11, a 41,216-square-meter plot of virtual land was sold for $572,000, which Decentraland said set a new price record on the platform.

Data from the NonFungible.com website shows that another Decentraland plot was sold for $283,567 on March 21. Omnium Space said that a property on the platform was also sold for more than $500,000 on March 16.

Metaverse enthusiasts liken the rush to buy virtual land to the battles over domain names in the early days of the internet. Their theory is that as more people focus on the area, centrally located plots of land will become extremely popular due to the high volume of tourist traffic.

Samuel Hamilton, head of Decentraland, said that some early investors who bought virtual land are now selling these plots to companies. The company has partnered with Adidas to hold a virtual fashion show, and the designs were auctioned in the form of NFTs. Decentraland is also attracting the interest of musicians, who can perform in this space and sell tickets and merchandise as NFTs.

Although the industry is currently very hot, some analysts believe that the NFT craze may burst in the near future.

Ben Nolan, founder of Cryptovoxels, believes that there will be a crypto winter in the coming months, and the entire NFT craze will burst and then collapse completely. It would be very unwise to enter the NFT market as an investment or a way to make money.