Unlimited Supply is Putting People Off the Virtual Land of NFTs

Unlimited Supply is Putting People Off the Virtual Land of NFTs

Trading volumes for virtual land NFTs have collapsed over 98% from their highs

Digital property sales are notching never-before-seen highs as investors pile millions of dollars into real estate in the metaverse. But now trading volumes for virtual land NFTs have collapsed by over 98% from their highs by three-quarters, and ownership distribution of parcels is centralizing. The Sandbox, Axie Infinity, Decentraland, Earth2, Crypto Unicorns, and NFT Worlds are not faring much better. The collapse in virtual land NFTs mirrors the wreckage in the NFT market. A few institutional NFT investors are paying large amounts for these lands, and it also has to do with the high price of cryptocurrencies.

Virtual trading volume tracking sales for 18 metaverse virtual land projects plunged by about 98% from 2021 to 2022. The largest metaverse investor, Meta, has admitted in public filings to over $13 billion in losses on its metaverse initiatives. The suppressed trading volume is due to the ongoing bear markets and the slump has sucked out the enthusiasm of investors.

NFTs trading volume falls 98%:

Most metaverse realtors rely on corporate partners to advertise fun experiences to attract new buyers. However, corporate partners hesitate to buy parcels if users are not already nearby. The NFT boom was its counterpart, the Metaverse, which many believed would be the digital playground to use these NFTs, whether through avatar skins, items, or interacting in exclusive online communities. The Metaverse is touted to be the next big thing in technology, but the slump is shedding doubt about its prospects.

With trading volumes 98% off their highs industry-wide, the virtual real estate market has unquestionably crashed. The drop in trading volume has resulted in a section of the market questioning the general utility of virtual land. If the virtual land sector doesn't address the visual graphics issue, it could end up becoming just another fad.

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