Passive income is sort of the pinnacle of investment success. That's why we invest, so we can make our money work for us, and not the other way around. Lots of people have found many ways to succeed with passive income in real estate, and more are finding that virtual real estate can offer the same benefits.
The idea of buying a plot of land in the 3D realms of the metaverse and tossing a billboard up as a means of earning passive income from metaverse real estate has captured many hearts and minds. But before you throw some money at a metaverse billboard business, there are a few things you should know.
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1. How does your metaverse platform work?
If you're new to the metaverse, it's really important that you log into the platform where you'd like to invest and have a look around. It may seem trivial, but it's actually really important if you're looking to own billboards or kiosks. Not only can you see what's near the virtual real estate you're scouting for a billboard, but you can see something a lot more important: how your metaverse platform works.
Most metaverse platforms allow you to jump into, for lack of a better description, a virtual real estate plot, but what happens from there can be very different. Certain platforms, like Decentraland (MANA 2.09%), build the part of the world that's around that plot at the same time, so you can see your neighbors, the skyline, people walking down the street, and so forth. Others, like The Sandbox (SAND 3.42%), tend to build just the area that you're in, be that a specific land parcel or a larger estate. This is a really important distinction when you're considering billboards.
Persistence (Decentraland) or non-persistence (The Sandbox) can have a huge effect on the success of billboards as a stand-alone business. In short, if the neighbors don't all display at the same time, you're not displaying to them, either, so no one will see your stand-alone billboards or kiosks. It's vital to know if your world is persistent or non-persistent.
2. Cryptocurrencies, NFTs, and digital wallets 101
Another important thing to understand, at least on a base level, is how cryptocurrencies, non-fungible tokens (NFTs), and digital wallets work. You'll need all three to have a successful metaverse real estate business, no matter what kind.
Cryptocurrencies vary between platforms, so you'll need to pay close attention to what kind of crypto you're holding. You can't buy digital real estate with cash, after all, and not all cryptos work with all platforms.
Your land holdings will come with a proof of ownership known as an NFT. You can think of this as a sort of digital deed that gives you ownership rights, much like in real-world real estate. You can sell, trade, lease, and destroy all or part of your holdings at any time.
An additional benefit of holding digital real estate as an NFT is that it's easy to verify ownership and create a chain of title, so tracking the history of your property takes seconds, versus weeks with real-world real estate. This can speed up lease agreements and purchase transaction times.
Both your crypto currency and your NFTs are stored in digital wallets. Most metaverse platforms will accept more than one wallet -- the choice is yours as to which you'd rather use. Once you've chosen a wallet, though, make sure to write everything down on paper. There will be a string of words you'll be provided with that will be the only way you can recover your wallet if you lose your password. If you lose these magic words, you'll lose your virtual real estate empire. (I wish I were joking.)
3. The players within the metaverse and without
Owning metaverse real estate and building billboards there is a great start, but you need to have someone to lease to. There are many ways to accomplish this, but as a matter of good business, it's important to know the major players who are in your metaverse platform. After all, good marketing sometimes means making people aware that you exist.
Even if you don't choose to market your billboards by yourself, knowing which virtual real estate companies are most familiar with your world will help you pick a leasing company that can help you connect to the right people at the right time and for the right amount of money. All sorts of brands are looking to step into the metaverse right now -- you just need to find a way to connect to them.
Metaverse real estate investing requires a few new skills
As a real estate investor, you probably already have a huge range of skills associated with real-world land. They will absolutely help you in the metaverse. However, there are a few other things you'll definitely want to understand and examine before you choose your investment location, especially if you're planning on putting your money in billboards and kiosks.
First, you must understand the way the world works. Because it's not the real world, the software can control what users see and when. If you're in a world that won't display your billboards to neighboring plots, that's bad for billboard business.
You'll also want to secure a digital wallet and learn how to use it, along with monitoring the cryptocurrencies used in the realms in which you'll be leasing. Not only will you have to buy your land using this currency, you'll also likely have to accept your rent payments in it, or another cryptocurrency. This is the money of the metaverse.
Leasing billboards in the metaverse can be a simple way to create a passive income stream. As the metaverse grows, it's also going to be a great way to generate more than just typical appreciation from a plot of land that might otherwise sit empty, waiting for a buyer.
