What Is Behind The Sandbox (SAND) And Decentraland (MANA) Astronomical Rise In Recent Weeks?

Shortly after the social media juggernaut’s rechristening, Microsoft announced its plans to join the metaverse marathon with 3D avatars and immersive meetings.

In similar news, sports accessories titans Nike and Adidas also shared their plans to enter the metaverse. While Nike announced a collaboration with the online game Roblox to create a 3D virtual space called Nikeland, Adidas stated it would partner with the leading crypto metaverse project The Sandbox (SAND) to develop its metaverse offering.

By now, you might have started noticing a pattern here that leading entities across different industries are not shying away from dripping their feet in the novel metaverse space. As a result, certain metaverse-related tokens have witnessed an astronomical surge in price in the past few weeks.

Two Winning Tokens

Two notable tokens among these are Decentraland (MANA) and The Sandbox (SAND).

In this article, we will delve deep into the two above-mentioned metaverse-themed tokens and explore the reasons behind their envious traction in the past weeks.

So, without further ado, let us jump right into the metaverse.

What is Decentraland (MANA)?

Decentraland is an Ethereum-based decentralized, online virtual-reality blockchain project that is aimed toward the creation, development, and sales of virtual land. The idea of virtual or digital land might be a little difficult to wrap one’s head around initially but we will explore the idea in detail throughout the article.

In Decentraland, users interact with pieces of virtual plot called LAND that are essentially non-fungible tokens (NFTs) that give its holders exclusive ownership. In addition, users can also pay for in-world goods and services within Decentraland to foster the in-game economy.

Decentraland has a native ERC-20 token called MANA which is used to purchase the aforementioned LAND and in-game items and services. However, the interesting part is that whenever a user buys LAND in Decentraland, the MANA used to purchase the said land is burned forever. Such a token mechanism exerts a price pressure on the MANA token due to its continually depleting supply.

Thus, a positive price loop is created which incentivizes the purchase of LAND to inflate the price of MANA tokens. While initially the Decentraland team sold LAND for 1000 MANA each, today LAND is only available for sale on secondary markets.

Currently, the cheapest virtual plots or LAND in Decentraland is available for north of 10,000 MANA which, according to current market price, is for more than $47,800. Similarly, like in the real world, LAND in the popular regions in Decentraland demands price in millions of dollars.

For instance, recently a virtual plot in Decentraland was sold for a whopping $2.43 million (618,000 MANA) to Metaverse Group.

What is The Sandbox (SAND)?

The Sandbox is another virtual-reality blockchain-based metaverse project that allows users to interact with one another in a digital world. Like Decentraland, The Sandbox allows its users to purchase plots in its virtual economy for SAND, the native token of the project.

Similar to Decentraland, The Sandbox also offers units of LAND that can be used by individuals or companies for whatever purpose they deem fit.

The Sandbox is also gearing up to launch a play-to-earn blockchain game that would allow users to use their Ethereum-based NFTs to build their in-game virtual identities and play with their peers. More details about the game are expected to be announced soon.

The project’s native token, SAND is used to fuel the in-game economy in that the token can be used to purchase LAND and perform any type of transaction and interaction within The Sandbox ecosystem. Further, SAND can be used as a governance token to chart the future course of the project.

SAND can also be staked in The Sandbox ecosystem to earn in-game rewards in the form of NFTs and a share in the revenue from all transactions in SAND tokens.

The Sandbox has been gaining a lot of mainstream lately as the leading sports accessories brand Adidas announced on November 23, 2021, that it is mulling developing its own adiVerse in The Sandbox.

What’s the Deal with Virtual Plots Anyway?

Such exorbitant prices might prompt you to ask the question, why are people spending millions of dollars on pieces of land that are not even tangible?

The answer is simple, it is a part of companies’ futuristic business expansion strategy.

According to gaming giant EA, the blockchain-based virtual reality gaming industry is slated to grow into hundreds of billions of dollars in the coming years. Accordingly, an increasing number of companies are shedding cash to make their presence felt in such digital realities.

An apt comparison would be the in-stadium advertising by popular brands during a football match with the only difference being that in Decentraland or The Sandbox, the brands are not required to pay per match. Instead, they can permanently buy a space in the virtual land in the form of an NFT and use the same for advertisement, expanding business, and increasing customer engagement in ways never thought before.

To conclude, the idea of a metaverse is still in its infancy and it is likely that the eventual product that disrupts our daily lives would be a lot different than what is currently being portrayed.

While it remains to be known if the metaverse narrative sustains the test of time, one thing is for certain that we will see both Decentraland and The Sandbox play a key role in shaping the future of virtual reality in the coming years.

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