The Struggling State of Blockchain-Based Virtual Worlds

DappRadar analysts emphasize the need for understanding the evolving utility of metaverses.

Recent on-chain data indicates that blockchain-based virtual worlds are facing challenges in sustaining their growth. According to a monthly overview report by DappRadar, the number of land sales in virtual reality projects dropped by 23% in August 2023, with only 8,329 sales (worth a total of $4.1 million), compared to the previous month.

Trading volume in virtual worlds | Source: DappRadar

This decline in sales coincides with regulatory pressure faced by the crypto industry as a whole during the ongoing bear market.

Metaverse land sales update a year-low at $4.1m - 2
Decentraland volume and sales data on a daily basis | Source: NFT Price Floor

According to data from NFT Price Floor, the average sale price of Decentraland land has dropped by 22% to 0.5322 ETH (~$860 at the time of writing) per land over the past 90 days. Additionally, trading volume in Decentraland decreased by 40.5% during the same period. Similar trends are observed in other metaverse-focused ecosystems.

However, Sara Gherghelas, a blockchain research analyst at DappRadar, suggests that users and investors should focus on understanding the evolving utility of metaverses. Gherghelas points out that while metaverses were initially seen as platforms for land sales and trades, their purpose has expanded significantly.

“Initially conceptualized primarily as digital arenas for land sales and trades, their scope has broadened substantially.”

Sara Gherghelas, DappRadar analyst

Gherghelas also recommends that the market reevaluate the metrics used to assess the success and potential of a virtual world. Instead of solely relying on land sale volumes, attention should be placed on continuous developments, innovations, and holistic user experiences.

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By Team