Metaverse Land, anyone?

Mondeoman · January 10, 2022, 4:01am

Hi all,

I wondered if anyone had purchased any virtual land or metaverse land yet?

In our crypto portfolio a small part is dedicated to what I used to refer to as “sh__coins” but now more reverently refer to this part as the “three zeros strategy”. It is three zeros because any holding associated with this strategy needs to have a possibility of becoming worth 10X, 100X or even 1,000X of the buying price.

There are few criteria that govern whether or not we seriously consider this as an “investment”.

1 In all, the contributing investments may not exceed 10% of our crypto portfolio in total
2 Any specific “three zero” investment must not exceed 1% of total portfolio value
3 At first opportunity for the crypto to double, we sell half and invest it in another “three zero” opportunity or park it in stable coin funds if we don’t have an immediate use for it.

I have decided to add a further criterion to the mix when it comes to that investment being a NFT (a piece of land).
4 It must have a future plan to earn income, and it must be possible either passively, or with active participation to earn a headline target rate of 20% per year on original cost.

Just before new year, we participated in an initial offering for a new game, not yet released, on the Harmony (ONE) network for a new game called Tranquillity City.

I had no plan at all to participate in virtual land ownership, and the only reason I took this opportunity was because of the extremely low transaction cost of Harmony, and the relatively huge success of the first gaming app on their network - DeFi Kingdoms.

I watched a video of some beta tests with block characters wandering around the city, but that was all. We can now log on to the game and view our owned assets. So four more NFTs to our name, and growing fast. Our other NFTs have made an impressive start to income generation. Though they require daily attention, it seems they will be generating up to 10% per month of their purchased value, but I am expecting a slowdown of their daily, weekly or monthly income earning potential just so I don’t get disappointed.

Here is a link to a developer vlog. I find this kind of pre-release communication excellent. I am imagining renting out our apartments and having to run around to the flats to collect overdue rent, and being able to sledge hammer the druggies if they haven’t paid their rent instead of having to go to court and fill in a section 21 form and turn up in court to get permission to evict bad tenants. Love this virtual world.

ria_rose · January 10, 2022, 4:08am

The developments just never fail to amaze me! I’ve heard about people buying Metaverse and virtual lands, and tbh, I’ve always wanted to get in on the action too! But of course, since these things are still quite new and ambitious for me, I haven’t gone beyond NFT coins. I truly wanna understand how these work before I decide to invest on Metaverse Real Estate. I’ve been watching videos online, but hearing about it from a friend’s experience is definitely more convincing. How exactly would you earn from Metaverse lands? Do you rent them out, or just like real-world lots where the prices just go up naturally? I’m sorry for the stupid question. Just really interested!

Mondeoman · January 10, 2022, 4:49am

Hi @ria_rose,
There is no such thing as as stupid question. I was clueless about this until a revelation from a friend on 19Nov21. So less than two months and I am now the proud owner of 29 NFTs. 25 of them all earn income every day. That is in the game DeFi Kingdoms on the Harmony (ONE) network. The hardest thing to get going was to install a Metamask wallet on my laptop. After learning how to connect that to the Harmony network and having bought some ONE tokens on crypto.com in exchange for BTC, I transferred the ONE from the crypto.com exchange to my metamask wallet then transferred them to the game where they can be used to create Jewel tokens, Jewel / ONE liquidity pairs to either put in the bank (at about 40% APY) or to invest in the Gardens for about 500% APY. You need to understand two things. First, both ONE and JEWEL can and do go down in value as well as up, and the APY is not realistic. It is the amount you would earn if the rate stayed the same for an entire year without changing - and that is not the case, but it does represent real earnings on a daily basis (current just over 1% per day in my case).

Second, please read about “impermanent loss”, what it means and how it can adversely affect the real (Fiat) value of your earnings in liquidity provisioning, bond investments, and “income earning potential” of NFTs. If you spend about 8 hours watching short videos on these subjects you should start to understand they are all much of a muchness. On the subject of earning from Metaverse lands, I am on a wing and a prayer on this one. The evolving whitepaper is not finished, the game has no release date, and I have no idea at this stage how much it will cost me to furnish our apartments with goodies from the store (that isn’t open yet) and how much rent I will get from my apartments. But based on similar games that have released in the past, nothing would surprise me. There were only a limited amount of houses, then large, then medium, then small apartments available to buy in short time windows, and they were pretty cheap. About $100 for the small apartments which is all they had left when I realized I had missed the opening day and logged in to see if any property was left. So if they burn to zero, it has cost me some of my crypto profits. If they double in price I have the option to sell 2 apartments and keep the other two for free - to add to the “three zeros collection” where the underlying asset cost me nothing. For sure it is money I am prepared to lose 100%, and that is why I put a maximum cost on every such idea.

It is my understanding that you can start DeFi Kingdoms for a few ONE. Just to try out the concept, I guess you could buy 100 ONE for about $25, convert 50 ONE to Jewel (about 2.5 Jewel, pair it up with the 50 ONE for the liquidity pair then put it in the bank at 40% APY. You will be able to see and calculate you interest after a day or a week to validate the concept. Then decide how much of your portfolio you want to commit after that trial. @ponponwei has done that with a small allocation on another yield farm to prove the concept. I think that is a far better use of a speculative $100 than trying to earn 20%+ per year on Forex trading.

ponponwei · January 11, 2022, 10:01pm

I spoke to a friend who did a lot of DeFi transactions this year and he sounded like he kind of regretted it due to the number of transactions he’s made aka the tax part of it sounded like it was a headache for him. Is this something you also encountered?

I’ve only really dabbled into DeFI this year with the intention that this year will be the headache part for taxes lol.

Mondeoman · January 11, 2022, 11:04pm

Oh, my heart bleeds for him.

Somebody on a Youtube video said that if you are not making money in crypto it’s because you are not treating it like a business. I have just bought my 51st NFT and have sold a total of 12, If I did not take care to create a suitable buy/sell/profit/loss sheet whilst I was building up this interest, I too would be concerned. About crypto more generally, I have taken care to book all my purchases and disposals in Coingecko by date, amount, equivalent USD fiat value. The paperwork easily takes just as long or more than the trades. For the past five nights I have been particularly busy buying and trading 12 of the total since inception. The number of transactions is only likely to speed up, not slow down, so I can’t tell you how many times I have iterated what I call my “job book”, but this is something I set up 30 years ago when we started a goods and services trading business, so I have borrowed a great deal of the “business process flow” mindset from that business venture. Why I love computing and a good filing system is that nothing is wasted. Everything can be reused. That original business still maintains the same job book I set up in 1991 (we are at job 25,000 or something like that). Though I have no daily input to that business for the past 20 years, my trusted director still uses the reports I set up all that time ago.

Worried about taxes? Hell no. I just hope I will be liable for a six figure tax sum next year, not business as usual. To have to pay taxes it means you had to make a profit. And it seems to me that anyone who looks at taxes as a headache does not really deserve to be in business. If he is not inclined to do his own taxes, just pay an accountant to do the tax preparation for him. We have a tax accountant, but I prefer to know when I am going bankrupt or making enough to be bothered about tax before my accountant tells me, especially if it is going to be the former.

Mondeoman · January 13, 2022, 8:25pm

An update on my virtual land experiment. Earlier today I was researching organisations that traded NFTs. I did not expect to find a secondary market in TC apartments yet since I only bought them on 23Dec21. To my amazement there are quite a few for sale. I decided to go through the hoops of registering to trade one of those we own. This took some hours and when I finally was able to put one up for sale, I thought "in a way this current difficulty in accessing services is really good. It means there is less competition, which leads punters to a feeling of “scarcity” and a great time-bound opportunity. Some of the sellers are asking stupid money, but today in the Metaverse, I can’t yet define what stupid money is. $69M for a single NFT? That is stupid money. For the rest of us plebs, even a few hundred dollars may seem to be stupid money.

I have this great feeling that the metaverse in particular, and crypto currencies in general, are attracting an awful lot of money that has nowhere else to go. From the fiat world. If anyone dipped their toes in crypto for more than a few years and stuck at it, they will also be awash with crypto-cash, perhaps 10 to 100 times as much Fiat value than they have had to manage in their lives.

So I’m going to market to test the water. Before I have put pen to paper on my “NFT trading strategy”. Wish me luck - I will report the results if I ever manage to sell a virtual apartment.

HeavenRobinson · January 14, 2022, 3:24am

To be honest I still have a lot of research to do on the whole Metaverse situation before I can make my mind up, but I’m not 100% into it. Yes, I’ve considered buying land but can’t decide if I think it will do well or not. I’m sure it’s gaining a lot of interest and it’s a neat concept…but are people really going to like it?
For example, I saw a video of someone shopping at Walmart in the Metaverse. They probably still have more work to do but the whole thing seemed to just add an extra step and while it would be nice to shop without the crowd, it felt empty and robotic to me. I’m stuck home a lot and enjoy getting out any chance I get, but trying to see things from other’s point of view as I’m sure there are some that would prefer the opposite.
Either way, I’m curious to see what others think!