It’s all coming together: traditional finance and corporate entities are starting to understand the potential impact web3 can have on the bottom line.
Specifically, the metaverse.
The FOMO is real. And the corporate land rush has begun.
- JP Morgan buys land and opens a lounge in Decentraland.
- Major companies like Gucci, Warner Music and Ubisoft have entered The Sandbox.
- The New York Stock Exchange files for an NFT marketplace trademark.
JP Morgan enters the meta-race
Breaking news: banking giant JP Morgan says one thing, and does the other.
In 2017, JP Morgan chief executive Jamie Dimon threatened to fire any employee trading Bitcoin for “being stupid”.
Today, it has made a complete 180 degrees U-turn and opened a lounge for its customers in the Decentraland metaverse. And it looks something like this:
In a paper posted for its clients, JP Morgan referenced 4 examples of virtual worlds as potential metaverse leaders: Decentraland, The Sandbox, Somnium Space and Cryptovoxels – whilst stating in the paper that:
“The metaverse will likely infiltrate every sector in some way in the coming years, with the market opportunity estimated at over $1 trillion in yearly revenues.”
As online social interactions begin to migrate from traditional forms of social media into the metaverse, companies will find themselves needing to establish their own presence in order to reach their customer base. And with such a titan of legacy finance making a metaverse play, it’s only a matter of time before other banking giants follow suit (not to mention global companies and brands looking to future-proof their digital marketing campaigns).
We’re seeing this new trend playing out in real-time.
And nowhere more clearly than in The Sandbox.
Corporate FOMO has kicked in, and LAND is flying off the shelves.
The Sandbox is one of the biggest metaverse players to date, bringing together aspects of gaming and social interaction in a digital world you can build yourself, “block by block”, just like in Minecraft.
To illustrate this land-grab playing out, Sebastien Borget, co-founder of The Sandbox, shared this beautiful bird’s eye view of the metaverse’s entire map, complete with the locations of all the corporate entities to have already secured their spots.
The numbers are astonishing.
In his phenomenal deep-dive, Mason Nystrom takes a look at figures:
The Sandbox has generated $350 million in LAND sales to date, with 80% of that revenue coming in Q4 of 2021.
Meanwhile, secondary sales have been growing exponentially, with over 14,000 unique active buyers, amounting to 37% growth in Q4 of 2021. The highest price paid for LAND on the secondary market has been $245k, with others following closely behind at $187k and $130k.
As the excellent thread points out, certain areas within the Sandbox are emerging as the ‘most desirable’ (just like the real world), with 12×12 plots of LAND within them going for serious money.
Like attracts like, and some of the most sought after hotspots now include names like Atari, Ludena Protocol and Sandbox’s own estates. Some of the largest estates of all trade less often, possibly due to the fact they are owned by some of the cryptosphere elite, like Binance, who are likely in it for the long haul.
But nothing goes up in a straight line. As it stands, floor prices peaked at 3.6 ETH in December (as well as the SAND token itself peaking at $8.44 on 25th of November).
However, with so many institutions and brands likely to follow suit, supply and demand would suggest prices won’t stay suppressed for long.
Apart from investment banks, who else is buying virtual land?
The biggest brands in the world are joining in, and they’re not here to play, or even build (they’re hiring professional metaverse builders structure the foundations of their digital presence). Nor are they here to make quick gains by flipping LAND. Instead, they are here to reach consumers.
The digital catwalk
Fashion brands were some of the first to jump into the metaverse. Gucci and Adidas (who are partnered up with Bored Ape Yacht Club in 2021) have purchased LAND plots, while Nike is launching the Nikeverse in collaboration with Roblox.
Web3 and gaming
Metaverse and gaming are often put in the same sentence, and gaming studios were some of the earliest to secure their spots of virtual land, with the Sandbox already being home to amongst others, Atari, Ubisoft, and Activision.
Consumers don’t want fun and games without food and drink, which is why one of the biggest chain fast food restaurants worldwide, McDonald’s, is also betting big on web3 worlds. It may not have secured a spot in Decentraland or the Sandbox quite yet, but with plans for a McCafe in the works, we could see a trend emerging, as leading food outlets seek to secure their spot to provide virtual refreshments (and entertainment) in the metaverse.
Is Wall Street about to ape into NFTs?
NFTs and the metaverse go hand-in-hand. Unsurprisingly, then, we’re seeing major institutions looking to capitalize.
If a major banking institution entering the metaverse isn’t big enough, the New York Stock Exchange has just filed a trademark application for its very own NFT marketplace. This is huge, and we’ll be covering it in more detail as we learn more!
The writing is on the virtual wall
Alex Becker was shouting it from the rooftops for the best part of 2021, and his conviction shows no sign of diminishing: as he puts it, unless we see a disastrous world event, and same time governments don’t turn off their money printing machines, we could see an explosion in metaverse projects that he describes as ‘beyond logic’.
As he says, we’ve never ‘seen this combination of corporate and high level investor fomo’, combined with ‘extreme ease of access to the market for retail’, combined ‘with every crypto shovel seller aggressively running ads with endless war chests’, combined with the relatively low marketcap of the metaverse right now.
Institutions are coming, and the corporate land grab is underway. Many more will follow. And the prices we’re seeing today for this virtual real estate could pale in comparison to what’s to come.
We have only just started to see the full potential of blockchain technology. Every so often, out of nowhere, comes a new disruptive use case for it. We saw it with DeFi and then with NFTs. Even though gaming saw explosive adoption in 2021, when looking at the wider metaverse, we can safely say the best is yet to come. With so many major players entering the metaverse it is looking more and more like a balanced portfolio should include the biggest metaverse projects out there. Follow the whales.