Nobody’s moving to the metaverse

Back when everyone was excited about the seemingly endless potential of the metaverse, metaverse real estate was hot.

Now, we must imagine a pixelated tumbleweed rolling through the streets of a digital ghost town as The Block reports a significant downturn:

• In late 2021 and early 2022, weekly trading volumes on metaverse platform Decentraland were at $1m+. One plot sold for $2.43m.
• Today, just 20-30 traders trade ~$50k/week.
• Of Decentraland’s 98k land NFTs, it still owns ~68% of them.

Meanwhile, attendance at Decentraland’s Fashion Week dropped from 108k in 2022 to 26k this year, despite showings from well-known brands.

Why?

The Block notes that gaming platforms, like Fortnite and Roblox, are going strong, while metaverse platforms like Sandbox and Alien Worlds aren’t.

Gaming platforms, however, are fun, and the average user usually knows what they’re supposed to be doing there.

• The Verge’s Jay Peters attended Decentraland’s Fashion Week and found it hard to navigate, sparse, and glitchy.

That lack of traffic probably isn’t ideal for the brands that showcased there — including Balenciaga, which was misspelled on its own booth and which seems to be doing better with AI-generated memes anyway. So, why shell out for virtual real estate no one visits laden with ads no one sees?

There’s also, of course, the real world, where inflation has likely left people inclined to spend money on IRL items over virtual ones.

But maybe don’t count it out

There have been some fun metaverse splashes — Tender Claws’ VR staging of The Tempest comes to mind — and virtual concerts from stars like Ariana Grande have pulled huge numbers. Plus, Fortnite players do spend money on skins and digital items.

Maybe the key to metaverse retention isn’t real estate but just… building something social and fun first?