Someone Just Bought a Strip of Virtual ‘Land’ for Over $3 Million

Someone Just Bought a Strip of Virtual ‘Land’ for Over $3 Million
Photo: Anthony Kwan, Getty Images

In yet another example of virtual goods selling for sky-high prices for no discernible reason, an investment firm just dumped roughly $US2.4 (A$3.34) million on a giant plot of… virtual land. Isn’t the future great?!

On Tuesday, the Canadian investment firm announced that it had purchased 116 parcels of virtual land from a company called Decentraland, which bills itself as “the first-ever virtual world [that’s] owned by its users.” It might sound near-identical to the virtual worlds of days of yore — specifically, Second Life — but don’t be fooled. As the company notes, “unlike other virtual worlds such as Second Life, it is not controlled by a centralised organisation or company.” OK, dude.

The investment came out to 618,000 MANA, the Etherium-based token that Decentraland uses as its in-world currency. Translating that into U.S. dollars, this firm spent $US2,428,740 (A$3,375,098) total on the transaction, which Token’s release notes is the largest transaction “of its kind” to date.

For that mega-investment, the firm got 116 virtual land “parcels,” which adds up to about 566 sq km of land — a little larger than the size of your average basketball course. For reference, while prices for IRL plots of land vary wildly by state, some estimates put the average price per square foot in the U.S. at around $US123 (A$171), meaning that the real-world equivalent of this purchase would have cost about $US750,000 (A$1,042,237), instead of… $US2.4 (A$3.34) million.

But these aren’t just any parcels, according to the release. This plot is smack-dab “in the heart of the Fashion Street district within Decentraland, and “will be developed to facilitate fashion shows and commerce within the exploding digital fashion industry.”

In other words: This basketball-sized plot of land will be turned into a digital mall, at a time when actual, real-world malls and retail hot spots nationwide are crumbling, thanks in large part to the surge of e-commerce shepherded by the ongoing covid-19 pandemic. Meanwhile, major brands are going all-in on the NFT trend, with mega-brands like Gucci, Burberry, and Louis Vutton rolling out their own non-fungible goods over recent months. It was only a matter of time before someone rolled out a digital fashion district teeming with digital malls to show off these designs.