As the digital land grab accelerates in the metaverse, you may be wondering how you can get in on the action.
The metaverse refers to a handful of platforms on the internet that have built interactive worlds complete with virtual entertainment and businesses. There are only a limited number of plots of “land” in the two biggest metaverse platforms, the Sandbox and Decentraland, and both companies have said that they will never create more.
For those who are interested, Fortune dug into the nitty-gritty to figure out how to buy real estate in the metaverse.
What is a digital plot?
Before you decide to invest in digital real estate on any platform, you need to understand what a digital plot is.
On most platforms, plots of “land” are represented by X and Y coordinates on a map that makes up the entirety of a metaverse world. Each plot is turned into an NFT, which is sold either directly by the platform to a consumer, or by a secondary marketplace, the most popular of which is OpenSea. Once you buy a plot through an NFT, your sale is recorded on the blockchain of the given platform, and you become the sole owner of that piece of land within the metaverse.
But before you buy a digital plot of land, you need to come to terms with what it really is: an intangible space within a virtual world. And more important, buying into the metaverse is a bet on the future of the metaverse itself.
If the metaverse continues to become more popular, the price of the properties on platforms could increase. But the price of land could also drop if fewer people interact with a particular platform, or the price of a certain cryptocurrency drops.
What kinds of numbers are we talking about?
The minimum price for land in Decentraland, as of Wednesday, was about 3.087 Ether, or the equivalent of $13,675, according to OpenSea. The cheapest piece of land in the Sandbox on Wednesday morning was worth about 2.968 Ether, according to OpenSea, or about $13,135.
Preparing to buy land
Before you buy land, you have to set up a crypto wallet. One wallet commonly used to buy land is called MetaMask, and it’s accepted by the Sandbox, Decentraland, and OpenSea. To set up a MetaMask wallet, you will need to download the app on your phone or via the Google Chrome browser extension. After you download MetaMask (or another kind of crypto wallet), you will be asked to create a password and will likely be given a secret phrase which you’ll use to verify your identity later on. Once you’ve created a crypto wallet you can use that wallet to open an account on the Sandbox or Decentraland. And remember, it’s important to explore a given metaverse platform before you invest in it.
Once you get a wallet, you will need to exchange U.S. dollars (or whatever currency you’re using) for a cryptocurrency. You can easily buy Ether, the most commonly used crypto for land purchases, in the MetaMask Google Chrome extension using your debit or credit card. MetaMask will direct you to the crypto exchanges Wyre or Transak to complete the purchase. Keep in mind that both Wyre and Transak charge a processing fee for converting U.S. dollars to Ether (or other types of cryptocurrencies).
Searching for the right property
Once you have crypto in your wallet you can begin scouting properties on different platforms. The Sandbox and Decentraland both sell land directly, but on the Sandbox land is released by the company in waves, the most recent of which was on Dec. 2. Because of high demand, these waves often sell out in seconds, said Ryan Baue, cofounder of MetaMetric Solutions.
“Earlier this year, they were doing them every week,” he said. “Sometimes there’s a month between waves, but that’s kind of how they get into the marketplace, is through those primary wave sales.”
Your best bet may be to buy land on a secondary marketplace like OpenSea. Searching for “the Sandbox” on OpenSea or searching and navigating to the Decentraland page on OpenSea will bring up plenty of parcels that are for sale.
Chad Diefenderfer, a cofounder of MetaMetric Solutions, said it’s important to look for verified sellers of land if you’re buying on a secondary marketplace. Verified land in the Sandbox and Decentraland will have a blue checkmark by the offering on OpenSea, and it’s the safest option for buying real estate.
“Anyone can spin up fake OpenSea or Sandbox or Decentraland contracts. So just verify what you’re doing,” said Diefenderfer.
Be warned: It may be difficult to find land exactly where you want to buy it within a metaverse platform. If you want, you can also hire a metaverse broker or consultant to help you search. Companies such as NFT Property Group, MetaMetric Solutions, and Metaverse Group can assign you a real estate consultant to help search for plots in specific locations, or find the best value plots in the Sandbox or Decentraland. The secondary marketplace WeMeta also offers a simple interface for buying land if you choose to do so on your own.
“It really pays to look around and do your research before you buy anything because there’s no limit to what people can ask when they list these for sale,” Baue said.
Buying, holding, or selling your land
Once you’ve found the property you want you can usually put in a bid or buy it outright.
Once the purchase is approved by the seller, the land will appear in your crypto wallet. For security, Baue told Fortune that it’s important for landowners to back up their land onto a hardware wallet to protect against theft.
“I can’t emphasize enough the importance of a hardware wallet,” Diefenderfer said. “Twitter and various other places are just stacked with stories of people getting NFT, ETH, and various digital assets stolen from them because they’re not taking the proper safety protocols.”
A hardware wallet is a physical USB drive that you can use to protect your land from phishing attempts by adding two-step verification for whenever funds or NFTs are transferred out of your wallet. You can also use the drive to access the land to sell it securely from any computer in the world with an extra layer of protection.
After you buy your land you are the sole owner, not the metaverse platform it’s on. You can visit your digital plot in the Sandbox or Decentraland and build things with the platforms’ building infrastructure. You can also hire a developer or architect—just like in the physical world—who will come to your land and build out your vision for a fee.
If the price of land increases on the platform where you bought your plot, you could also resell your land on OpenSea. Or you can hold on to it and see just how high the price will go (remember, only a limited number of plots will ever be released).
Fortune’s upcoming Brainstorm Design conference is going to dive into how businesses are building experiences in the metaverse. Apply to attend the event on May 23-24 in New York.