Property tycoons and brokers get in on the action, particularly seeing the country’s scarcity of real estate
In Hong Kong, property tycoons and real estate professionals are taking up more interest in the metaverse and investing in digital land sales, said South China Morning Post.
The term “metaverse” has trended everywhere, and virtual land sales have become increasingly popular among those fascinated with the shared, immersive 3D space.
Coming as no surprise, valuations for virtual land has at times surpassed valuations in the real world.
A plot of land on popular metaverse platform The Sandbox sold for about USD4.3 million last month to Republic Realm, a New York-based firm that develops real estate in the metaverse.
In a country like Hong Kong where property is scarce and deemed critical investments, the interest around digital land sales is booming. Virtual land is believed by many to become a highly sought-after asset, particularly if digital shopping malls and mansions can be built on such property.
In addition to big conglomerates rushing to get in, individuals like former property brokers and asset managers are also in on the action.
Andrew Man, a Hong Kong-based investment professional, said, “Last Saturday, a new area opened up and the land was sold out in about a second. They made about 100 new plots of land available at the time. I was in a WeChat group with a number of other landowners and we all failed to buy one. It’s literally a race for finger speed.”
Man currently owns three plots, and one has quadrupled in value in a short amount of time.
“When I bought it, it was about 1.8 ethers (USD7,241). Now it’s nearing 7 ethers,” he said. Ether is the world’s second-largest cryptocurrency.
Jason Au, director of the Nasdaq-listed investment firm Troops Inc, is also an avid buyer of digital land.
Au said, “The way I see it, the world of NFTs (non-fungible token) and cryptocurrencies is kind of like going back to the beginning of the internet when people are registering domain names, etc. It’s like history repeating itself and it is an opportunity for us.”
To Hong Kong residents, digital land is very attractive and understandable than perhaps some other forms of NFT as property investments are highly relatable to them, said Yat Siu, co-founder and executive chairman of Animoca Brands.
“Unlike buying art or other things which can be hard to evaluate their worth, Hongkongers all understand the value of land,” he said.
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