Blockchain-secured land entices real estate investors

In the “real” world, real estate has historically been seen as a viable investment. Individuals and corporations usually purchase land and property either for development or to sell at a higher price in the future.

With the world becoming increasingly digitized, it appears that the trend of ascribing significant value to land and property has been spreading to the virtual scene. At the intersection of emerging tech like virtual reality and blockchain, developers, investors, and hobbyists alike are creating a vibrant virtual real estate market.

While VR provides the tools to visualize these digital spaces, blockchain technology is acting as a base layer for the monetization of virtual real estate. With the fallout of the coronavirus pandemic causing a pivotal move toward more digital forms of human communication, interactive virtual worlds may provide a safe space for the preservation of numerous social constructs.

Second Life and Linden Dollars

Virtual real estate is by no means a recent phenomenon. City simulators like SimCity have been around for decades. In 2003, a 3D virtual environment called Second Life arguably kickstarted the monetization of virtual real estate as users rushed to acquire digital land using the platform’s native currency, Linden Dollars. Second Life’s run was before the advent of Bitcoin (BTC); nevertheless, the project saw users buy, sell and lease properties, as well as run businesses on virtual land.

The platform soon declined, as other immersive and interactive virtual real estate projects emerged. However, at the height of its popularity, Anshe Chung, a “Second Lifer,” became a millionaire from selling digital real estate.

Virtual land as a commodity

With the coming of blockchain technology, VR platforms like Somnium Space and Decentraland enable users to acquire and monetize plots of virtual land. Recently, Whale — a nonfungible token vault — became the second-largest holder of virtual land in The Sandbox game.

Binance Launchpad hosted The Sandbox’s initial exchange offering back in August with the token sale event raising about $3 million. Binance is also an investor in the project, having bought over 4,000 Land tokens earlier in September.

Commenting on the growing popularity of virtual real estate, Joseph Madding, a marketing and PR consultant at The Sandbox, remarked that investors are becoming more open to the idea of digital land as a viable investment, telling Cointelegraph:

“Virtual Real Estate is definitely becoming more popular. Over the last 10 weeks, we’ve seen over 1,000% more users interacting with our Telegram chat, Discord, Twitter and other social media platforms and have expanded our community management to match the increasing demand. In terms of virtual land as a commodity, we’ve seen our LAND that originally sold at roughly $370 resell for over $2,000 for what we would sell as a small estate. That’s astonishing and shows huge community interest for our NFTs.”

Indeed, the rush for virtual land assets is only the latest in the established trend of digital real estate selling out quickly. In March, VR world Somnium Space sold 110 Ether worth of virtual land in the first week of a planned, 10-week offering at the time.

Upon opening its platform in February, Decentraland saw users purchasing millions of dollars’ worth of digital acreage. In 2019, a portion of the “Genesis Plaza” estate in the Decentraland metaverse called Estate 331 sold for about $80,000, becoming the second-most expensive NFT of 2019.

Expanding digital property landscape

While it is common to see projects pursuing the tokenization of real-world commodities, the emerging virtual real estate space is creating a self-contained digital economy. With blockchain technology as a base layer, these platforms can monetize digital land, enabling users to trade assets within the metaverse.

Apart from early adopters acquiring virtual land in the hopes of seeing assets appreciate over time, some individuals and organizations have been developing these assets. The process works similarly to real-world real estate development with the establishment of commercial and residential complexes, industrial zones, and parks, among others.

Part of the allure driving the desire to own virtual land appears to be based on optimistic projects about the viability of VR technology. According to a study published in August, the combined VR and augmented reality market is estimated to be worth $20.9 billion by 2025, with companies in China and India expected to drive this significant growth in the next five years. Head-mounted displays are becoming increasingly popular among game developers and enthusiasts alike. With advances in 3D technology, manufacturers are becoming better at creating HMDs that deliver a more immersive and interactive VR experience.

Meanwhile, for blockchain projects, in general, scarcity plays a major role in driving value for their native tokens. As is the case with the real world, for real estate holdings to remain valuable, virtual land on these metaverses needs to be finite.

The monetization of virtual real estate also offers another tangible use case for NFTs. Digital land developers are creating malls, boutiques, shops, and other retail outlets where they sell electronic merchandise like fashion items, rare cards, concert tickets, etc. For game developers, the marriage of VR and blockchain technology is creating the opportunity to enjoy “all-digital” gaming. Commenting on the benefits of fully digital environments, Madding argued:

“As a game developer, virtual real estate provides a nearly no-risk platform for publishing your games. With NFT technology, you’re not publishing on just an App Store anymore and you’ll have true ownership over the space in which you design and publish your game. As a consumer, owning LAND feels like buying any physical video game, and if you find yourself wanting to do something new, you can either design something completely new with our free tools, or you can resell the digital real estate just like you’d sell any physical copy of a game.”

Life after COVID-19

The COVID-19 pandemic brought about sweeping changes to human interaction, and the utilization of virtual forms of communication has taken center stage. As shutdowns continue across the world, organizations have been utilizing electronic video conference solutions for meetings. Tech giants in the United States have even issued work from home orders with reports of the practice expected to continue regardless of whether scientists come up with a vaccine for the coronavirus.

Conferences and meetups are a ubiquitous occurrence in the crypto and blockchain space. However, due to COVID-19 restrictions, it was not possible for people to physically attend many such events in 2020.

To navigate this hurdle, organizers and attendees flocked to the virtual realm, sporting creative avatars to discuss important issues in the industry. These events pushed the boundaries of electronic interaction from utilizing third-party messaging services to people interacting in a fully digital space.

According to Madding, the established social construct is becoming more open to digitization: “As the years go by, large social events like we see in Epic Games’ Fortnite may certainly be more and more common, and we hope to lead the way and see these amazing social spaces sprout up in our Metaverse.” For Artur Sychov, the founder and CEO of Somnium Space, the appeal of virtual real estate has been growing, telling Cointelegraph:

“We do see an increased interest in Somnium Land Parcels (PARCEL) because more and more people realize real use cases they can deploy and use those parcels for. Examples are talk shows, art galleries, cinemas, fitness clubs, crypto exchanges and more are already deployed inside our virtual reality world.”

As developers create more immersive and interactive virtual environments by solving issues such as display latency, it may become possible to have almost every social activity taking place in the digital space. Such solutions might even tie in with the growing NFT marketplace for items like concert and theater tickets.

MDMA rolls onto the psychotherapy scene as FDA greenlights Phase III clinical trial

Remember the commercial? This is your brain on drugs. One could hardly forget the stark image, the idea that using drugs literally fries your brain. And it’s true that the brain changes in response to drug use. How it changes depends on the substance, dose, frequency, and duration, as well as on the factors surrounding and supporting its use or abuse. But not all neurological changes have to be damaging. There’s a growing body of newly legitimized research on MDMA, which is often used as a recreational euphoric among club-goers and at music festivals. In light of what we know, the FDA has just made a controversial decision to greenlight a Phase III clinical trial, using MDMA to treat PTSD.

The fact that it’s Phase III is important because Phase III is the clinical trial designed to fine-tune the safety and effectiveness of a drug before it goes on the market. These trials have to be well-designed in order to draw any valid conclusions, and this particular study is under even more scrutiny because of MDMA’s presence on the Schedule 1 list of drugs with no acknowledged clinical value. Because MDMA has been “in the wild” for so long, there already exists a corpus of early research on its effects. Now scientists are applying for “breakthrough” status for its use in psychotherapy, on the premise that since it’s been around for a while, we know a good bit about its relative safety. What’s important, the logic goes, is quickly assessing its effectivity for “off-label” use to treat PTSD — which is sort of funny because normally it’s the off-label use that’s less legit.

It’s worth asking why a recreational euphoric is of any interest to clinical science at all. The answer is in the neurotransmitters. MDMA, also called “Ecstasy,” represents a profoundly different state of brain chemistry from the norm; upon dosing with MDMA, a flood of neurotransmitters including norepinephrine, oxytocin, dopamine, and serotonin are released by the user’s neurons. The idea is, essentially, that psychiatrists can use small doses of MDMA to grab patients by their recalcitrant neurotransmitters, from where it can be a useful adjunct to talk therapy — allowing patients to re-evaluate past traumatic experiences in a safe environment, casting the trauma in a different light, and breaking the neuronal stalemate. It could take a consciousness-altering experience to penetrate a PTSD patient’s deeply entrenched response to trauma. Alexander Shulgin, upon encountering MDMA, sought not just to understand its euphoric effects but also to explore its use as an antidepressant-like aid to talk therapy. According to his seminal work, Phenethylamines I Have Known and Loved, the first thing he did was run to his psych-department and mental healthcare colleagues with the drug, to get it under their scrutiny, from where it became much more popular both in therapy and in the club.

But MDMA also has a reputation for danger. Recreational users frequently report to emergency rooms for major body-chemistry imbalances, including grave sodium depletion, called hyponatremia — which seems like it should just get a “eat chips and drink some Gatorade, n00b” until you realize that your neurons (your brain is mostly made of neurons, by the way) literally cease functioning when their environmental sodium concentration is wrong. A lot of these issues stem from drug users not purchasing and using an MDMA test kit from a reputable source. Once a person’s neuronal function is compromised they may not be able to pick up on what’s wrong. There’s also an enduring but poorly substantiated expectation that MDMA in high doses can be excitotoxic, especially when the user is under high external stress — such as a loud, overheated club, when the user is exhausted, out of blood sugar and electrolytes, and possibly under the influence of other drugs. Rolling on molly, even once, can result in a brutal multi-day hangover related to the way it depletes serotonin levels in the brain.

This would suggest, even to the layman, that molly is at least transiently bad for your brain. But there’s a tide of conflicting user reports that high doses and frequent use are more responsible for any persistent damage than acute exposure. Furthermore, some long-term users report that taking precautions (“rolling smart”) and getting aftercare — e.g. supplements like 5-HTP, SSRIs, other neurotrophic drugs, and even cannabis — can mitigate this effect. This suggests that science may be overlooking situational but tightly associated risks of MDMA, in favor of monitoring those we consider inherent to the drug itself.

The UK’s Dr. Andrew Parrott, a much-quoted researcher on MDMA abuse, writes (PDF) that most MDMA users are polydrug users – 90% use alcohol or cannabis, usually concurrently with MDMA. Alcohol abuse is an important confounder. Furthermore, Dr. Parrott remarks, some of the damaging effects of MDMA on heavy users “are consistent with the ‘energetic stress’ model for recreational MDMA users, where the adverse metabolic effects of MDMA are exacerbated by concomitant non-drug stimulation,” although he cites only his own work to support his assertions.

The outlawed status of MDMA means that nobody has yet put MDMA-using patients or volunteers in an fMRI, nor made a broad, longitudinal survey of long-term users’ brain development with CAT scans. With the ever-increasing sophistication of our medical imaging and brain mapping methods, it won’t be long before we can tell just what clusters of cells are being affected by drug use, and how that changes the flow of information through the brain. Big data can lend itself to comparisons between large groups of those who do and don’t use drugs like MDMA, to apply the power of statistics to the sample. A better understanding of what different drugs do to the brain will lead to a better understanding of what to do about drug abuse.

In the end, people are going to seek out the recreational drugs of abuse they want to use, and withholding legal ability to do research on those drugs will not stem the supply. “The massive epidemic of casualties we were promised back in 1988 simply has not happened,” remarked Dr. Ben Sessa, a pioneering UK researcher on MDMA, rebutting Dr. Parrott’s works in a letter to the British Prime Minister. “Prof Parrott demonizes the medicine MDMA because he sees –- quite rightly –- that the illegal drug Ecstasy has its risks. But recreational Ecstasy is not the same thing as clinical MDMA.”