Investment opportunities in digital real estate are limited and still in early days

In today’s rapidly evolving digital landscape, the concept of real estate has transcended its traditional boundaries, venturing into the virtual realm. Digital real estate, still a niche market, is redefining traditional concepts of property investment. This blog explores two types of digital real estate and highlights its potential and challenges.

Virtual real estate

There are numerous options, but Decentraland and Sandbox are currently the most successful examples where investors can purchase virtual land through blockchain technology. It even provides the option of getting a mortgage on land. These virtual plots can be developed just like physical land, with buildings for businesses, attractions, or advertising spaces. The global accessibility of platforms like Decentraland allows investors to reach international markets without geographical limitations. 

Figure 1: An illustration of a piece of Sandbox land, where you can create real estate and monetize the virtual asset and content

Currently, both Decentraland and Sandbox have a market capitalization of around $ 1 billion. The idea and setup of these concepts is amazing and has been profitable for early investors. However, to really increase market size, it needs to be a bigger part of everyday life leading to a need for companies to be present, which could boost advertisements and rents.

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