Yuga Lab’s ‘virtual’ land bonanza

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Last week, 55,000 parcels of “virtual land” were sold on the Ethereum Blockchain for more than $300 million, the largest NFT mint ever. 

In return for shelling out close to $6,000, a purchaser received an Otherdeed NFT, which authenticates that buyer’s ownership of a patch of digital real estate in developer Yuga Labs’ new Otherside game environment.

The sale began on April 30  at 9:00 pm EDT, and the NFTs were sold out in about three hours. During that time, gas fees on the Ethereum blockchain soared, with eager customers sometimes needing thousands of dollars to complete a single transaction. Hundreds of investors not only failed to secure an Otherdeed token, but they also lost their Ether (ETH) gas fees as well. 

Metaverse growing Rapidly:  a report published last week by Kraken Intelligence which reinforced the notion that the Metaverse is a community of online “worlds” with many devoted to role-playing games which is one of the brightest stars in the crypto-based galaxy these days. Over the most recent 12-month period, the metaverse sector notched an annual return of +389%, noted Kraken, compared with Bitcoin’s at -34%, Ether’s at +3%, layer-1 networks at -10% and decentralized finance (DeFi) projects at -71%.

The Metaverse sector includes assets like Decentraland (MANA ), The Sandbox (SAND), Axie Infinity (AXS), as well projects like Yuga Lab’s Apecoin (APE). In online “communities” like Sandbox, an Ethereum-based play-to-earn (P2E) game, players can build a virtual world, including the purchase of digital land whose ownership is guaranteed by an ERC-721 standard nonfungible token. When Facebook rebranded as Meta in the second half of 2021, we saw a corresponding rise in the price of metaverse-associated fungible assets such as SAND and MANA. Before that, it wasn’t top of mind for most market participants.” It also represents part of an ongoing evolution of the crypto industry.  

Ethereum is high:  there’s the matter of Ethereum’s gas fees, which by one estimation may have reached as high as $14,000 during the Otherdeed sale. There’s no debate that gas fees as high as $6,000 per transaction is indicative of the ongoing scaling challenges Ethereum faces,” Perfumo said. 

Presight Capital crypto venture adviser Patrick Hansen said  “Ethereum has massive challenges ahead, yet again visible in yesterday’s crazy gas fees spike,” he tweeted on May 2. “But the fact that some people are ready to spend mind-boggling +4k$ for #Ethereum transactions also shows how valuable its blockspace 

The developer refunded some 500 transactions worth collectively 90.566 ETH, or about $244,000 at the time of the refund. The largest single refund was for 2.679 ETH, worth about $7,877 on May 4 when refunds were sent, according to Etherscan.

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