The Metaverse Land Rush Is an Illusion

After Facebook’s rebrand to Meta, a string of stories about a digital land rush began. Investors were buying up plots of land in cyberspace, sometimes for millions of dollars, seemingly convinced there must be gold in them thar metaverse hills. And if so many people with so much money were rushing it, it must be because there’s a profit to be made. Right?

However, the language that we’ve been using to discuss this new phase of technology—describing it in terms of a singular metaverse with finite space to develop—has helped conceal a reality that more closely resembles early-access video games and common pump-and-dump schemes.

It’s only been a couple months since Facebook’s rebrand, but it’s hard to overstate how much it’s already driven the conversation about “the metaverse.” For starters, nearly everyone describes it as the metaverse—when the reality is that there is no singular metaverse in the sense that we talk about “the internet.” Services like Meta’s Horizon Worlds and Microsoft’s Mesh don’t interact with each other, they’re just separate VR apps.

The problem with this language quirk is that it can give the impression that, for example, if a company says their VR app, video game, or social platform is part of “the metaverse,” then that specific app must be where this nebulous future is going to happen. Which is a bit like saying that augmented reality is the future, and Google Glass is an AR product, therefore Google Glass is the future.

Under this implicit framing, stories published everywhere from crypto-enthusiast sites to Business Insider and The New York Times, have touted a “virtual land boom,” highlighting the $2.4 million sale of a 116-parcel estate in Decentraland, as investors pour millions of dollars into virtual locations. In these articles, executives from Metaverse Group, a self-described “virtual real estate” company, described buying plots of land in “the metaverse” as akin to buying property in Manhattan long before the city developed.

More precisely, platforms like Decentraland or the Sandbox sell NFT-based tokens that point to sections of a map in their specific virtual worlds, but those spaces don’t cross over. As Dan Olson, a video essayist who has extensively covered online social experiences and movements, from Fortnite’s digital concerts to flat earth and QAnon, and is currently researching the crypto sphere, explained to WIRED, “They’re selling their tokens that give you permission to build within their space. So you’re effectively buying into their service.”

In other words, buying “real estate” on these platforms is like buying property in Manhattan, but in a world where anyone could feasibly create an infinite amount of alternative Manhattans that are just as easy to get to. Which means the only reason for users to buy into this Manhattan is if it offers a better service than the others.

In most respects, these platforms resemble your average video game. You control a customizable 3D avatar with your mouse and keyboard (no VR or AR here) and navigate a virtual environment. The debate over whether a virtual social world counts as a video game is as old as Second Life, but whatever you call them, the primary novel innovation in them is the use of NFTs and cryptocurrencies.