The child in me always wondered what it would be like to own a personal virtual estate. My own virtual villa might have amenities not possible in the real world, a neighborhood filled with other players, and an entirely new world to interact with. This is no longer a fantasy, but has become a reality as a result of The Sandbox (SAND 0.29%) metaverse.

Cryptocurrency gaming has the power to overrun the electronic gaming industry. Whether this interest arises from broader interest around the metaverse, or the functionality that is provided via platforms like The Sandbox, there's a lot to like about these blockchain-based metaverse tokens right now.

Piece of land with a sign saying "virtual land."

Image source: Getty Images.

That said, interest in this explosive growth area has waned somewhat of late. The Sandbox is down materially from its all-time high set last November. 

Can The Sandbox return to its former glory? Let's dive into three reasons why the bulls seem to think the answer is a resounding yes.

1. The Sandbox is a unique product in a competitive market

The Sandbox is far from the only metaverse offering in the market. However, holders of The Sandbox note that the platform is unique in its breadth of offerings.

Notably, The Sandbox has three main product offerings: VoxEdit, a marketplace, and a game maker. The platform's VoxEdit software allows users to create their own non-fungible tokens (NFT), or digital ownership rights to art, videos and collectibles, and import them into the game. They can then sell these assets on the marketplace. Additionally, the game maker software allows users to create mini games using the 3D voxel art created by the community. These games can be shared, and they are free to make. This level of integration between user-generated content, gaming, and a vibrant economy does not yet exist elsewhere in the metaverse industry.

The assets are purchased and sold with SAND tokens, the utility token of this network. As user growth rises over time, and transaction volumes increase, demand for SAND tokens should, at least in theory, increase in lockstep. This is a key factor driving the value of The Sandbox's valuation.

Growth expectations have come down considerably in recent months. However, we're seeing a resurgence in investor interest in metaverse platforms such as The Sandbox. Accordingly, those with a long-term investment time horizon may view this recent sell-off as a reason to dive into The Sandbox right now.

2. The Sandbox has celebrity-generated hype

Hype can be a good and a bad thing. Most notably, hype tends to exacerbate otherwise already-volatile moves. In the crypto market, this is the sort of double-edged sword that has resulted in some serious volatility in SAND tokens recently. 

That said, the amount of celebrity interest behind The Sandbox is intriguing. Iconic names such as hip-hop legend Snoop Dogg have scooped up virtual real estate on The Sandbox's platform. Other vocal celebrities have touted this project as one of the best in the space. DJ Steve Aoki recently purchased land in the metaverse, creating what he calls "Aoki's Playhouse," allowing users of The Sandbox to participate in virtual concerts.

As more celebrities join in on the fun, virtual real estate prices could remain elevated. As an investment opportunity, The Sandbox provides many options for capital appreciation for investors outside of SAND tokens. Accordingly, this space is a vibrant one, driven by a strong community, with hype a key factor investors will have to continue to consider over time.

3. The Sandbox has garnered major investment 

Interest from the gaming industry is what every metaverse project needs to expand beyond a community of hobbyists. Atari is one of the most notable corporate names to have purchased land in The Sandbox. The company intends to create a virtual theme park that users can spend SAND or an Atari token in. Atari is an early adopter of the project and has already sold land worth $4.3 million. More will come from Atari in the metaverse and it has paved the way for expanding into play-to-earn games.

Atari is not the only big player, however. One of the big four accounting firms, PWC Hong Kong, has also purchased an estate. PWC is seeking to advise clients on metaverse-related projects and be a player in this new industry. As more key commercial players enter The Sandbox, many expect to see entirely new markets for virtual real estate. 

Invest with caution 

Cryptocurrencies are inherently volatile and risky investments, but with sound planning, they can form a portion of a well-balanced portfolio. That said, investing with caution is always important. Given the nascent nature of the metaverse, this is perhaps even more true with a token such as The Sandbox.

Whether it's regulatory oversight, or simply the potential for user demand to dwindle over time, there's a lot of unknowns. Right now, investors have a rather intriguing token to assess, from a potential growth standpoint. That said, it's the "potential" piece that has some investors uncertain as to whether this token is worth a buy right now.