Digital assets, like virtual private islands and mere plots of land such as the JPMorgan Chase & Co. JPM lounge in Decentraland MANA/USD, witnessed multi-fold price appreciation during late 2021 and early 2022.
Since then, the value of that virtual land has been on a downward trajectory.
The average sale price of all virtual land sold on Decentraland in December 2022 was $1,878. That's roughly a 60% drop from the corresponding figure of $4,683 in February 2022, according to Dune Analytics' Virtual Land Dashboard.
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Recall how in mid-2021, tokens of leading blockchain-based projects like Decentraland, Axie Infinity AXS/USD and The Sandbox SAND/USD skyrocketed in price, fuelled by increasing demand for so-called metaverse land.
These projects drew hordes of investors, celebrities and big-name companies:
Benzinga's Take: The digital NFT land market is drying up. Platforms like Sandbox and NFT Worlds saw their average sale prices fall ~70% and ~93% respectively over the course of the last year.
The total value of land sold per month has fallen drastically, with Decentraland recording just $568,279 in sales in December 2022.
Compare this with its $5.18 million monthly sales figure in January 2022.
As a result, crypto investors who invested in these digital NFT lands during the boom cycle are not only staring at huge losses on their investments but are also in a dilemma of whether to purchase more virtual land or simply exit their investments.
Meanwhile, billionaires are apparently shunning the speculative digital NFT land market in favor of actual land. Bill Gates and Jeff Bezos have been acquiring thousands of acres of farmland across the U.S.
Larry Ellison and Tilman Fertitta are scooping up luxury resort properties.
Even though the metaverse, and companies like Meta Platforms META, are rapidly advancing and offering increasingly immersive experiences to users, it is anyone’s guess whether crypto enthusiasts will see their digital NFT land investments recovering in the year ahead.
Despite the hype, these current trends allude to the growing concern that retail investors are wasting their money on digital assets.
Next: Grayscale Struggles With Dwindling Investor Interest In Ethereum, Bitcoin Trusts
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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