Digital Real Estate

How To Invest In Digital Real Estate

June 21, 2022
5 min
How To Invest In Digital Real Estate

What is Digital Real Estate?

A Web2 definition of digital real estate would be that digital real estate is a term used to describe the front-end architecture that takes up space on the internet. Social media accounts, URLs, websites, and domains are all forms of traditional real estate.

Web3 added a few more things to that list, including Metaverse real estate, protocols, and projects within the real estate industry, including Parcl. Digital real estate nowadays should be considered more like an ecosystem.

Digital Real Estate Investing

Digital real estate investing can be done in a few ways. There are currently a few platforms that we think are best for beginners.

These platforms use blockchain technology to remove the middleman, ultimately making transactions cheaper and more secure. Other tech like synthetic assets and smart contracts allow tokenized ownership of a property or just no minimum investments in real estate, a refreshing change from buying a full property in order to gain exposure to the real estate market.

Web3 technology now allows the average person an easier, cheaper, and faster way to make money from real estate investing by investing in digital real estate first.

Companies such as Parcl, Propy, and Lofty are all building a way to open up real estate investing to millions of people currently priced out.

Click here to learn more about Digital Real Estate Investing

How To Invest In Digital Real Estate: Crypto Wallets

Typically the most popular wallets will be compatible with owning Metaverse property and holding tokens to invest in the wider digital real estate ecosystem; these include:

Phantom

With the increasing popularity of the Solana network and Solana NFTs, Phantom quickly became a huge favorite for the community due to its fast and easy-to-use application.

It offers various staking options, incredibly fast swaps and has recently released its iOS App, previously only offering an Android App.

MetaMask

Launching back in 2016, Metamask is certainly one of the most used cryptocurrency wallets, mainly due to beginners' advantage. It was built for users to hold Ethereum and interact with other projects on the Ethereum blockchain.

Ledger

Ledger is the industry leader in cryptocurrency wallet security; they've built a great reputation for being the more secure wallet provider on the market and have several products to offer users.

If you're holding crypto worth over a few thousand dollars, Ledger would certainly be the way to go. Especially when the value of your digital real estate increases, you'll need the safest place to store it. Ledger is a more expensive option but certainly worth it for security reasons.

Coinbase Wallet

Coinbase wallet provides Coinbase users with a self-custody option rather than storing their cryptocurrency on the Coinbase exchange. Self-custody means that you have full control over your funds. Whereas when you store them on an exchange like Coinbase, you don't solely control the coins themselves.

Coinbase is one of, if not the largest exchanges in the cryptocurrency market, and you can certainly feel at ease when you use one of their products.

Crypto.com

Crypto.com has two options to store your cryptocurrency, similar to Coinbase. They have their Crypto.com wallet and their Crypto.com app. The wallet is non-custodial, meaning you have full control, but you also have to pay transaction fees when moving funds around.

The app is the custodial wallet, meaning that you need to fill out KYC, and they can have control over your funds. The benefit to the app wallet is that you don't pay any fees.

If you're a fan of Solana and want to know the best Solana based crypto wallets to use, check out our top picks.

What Platforms Can I Own Digital Real Estate On?

Buying into digital real estate can either be through investing in Metaverse land or using blockchain tech to make physical real estate investing easier, cheaper, or faster. You can do this using a Metaverse platform or a protocol like ours.

Decentraland // Metaverse

Decentraland is one of the most popular Metaverse crypto projects on the market. It regularly breaks records for the most expensive land sales. The name of the land in Decentraland is called LAND, and one of the most expensive sales had sold for $3.2 million. The project is built on the Ethereum blockchain.

Sandbox // Metaverse

The Sandbox originated as a game for mobile and Microsoft Windows back in 2012. However, later on in 2018 was bought by Animoca Brands and began the pivot to building Sandbox into a Metaverse crypto game. A decision that would change the gaming and Web3 industry.

The feature that scaled the Sandbox platform is the VoxEdit interface, which allows you to create your own in-game assets, and the Game Maker allows you to build 3D games without spending your own cash.

Parcl // Real Estate Synthetic Investing

Parcl allows you to invest in US neighborhoods and real estate without owning the physical property. The protocol uses synthetic asset technology to make investing in property easier, cheaper, and faster than traditional investing and even other real estate crypto projects.

The benefit of using Parcl is that you can invest in places like Soho and Manhattan without buying a property, and there is no minimum investment needed. Parcl is on a mission to build a protocol that provides access to the real estate market, a market that millions of people are currently priced out of.

RealT // Tokenized Property Ownership

RealT is a tokenized property ownership platform that allows investors to purchase fractions of a home in the form of tokens. So, instead of owning a full property, you could own a certain portion for a considerably cheaper investment.

As a part-owner of the property, you're then entitled to rental payments, which are typically paid daily and in the form of cryptocurrency like USDC. Although this lowers the barrier to entry for most people, the investment options on platforms like RealT are incredibly limited, and the returns are minimal.

Which NFT Marketplaces Sell Digital Real Estate?

3rd party marketplaces are filled to the brim with digital real estate for sale, but this is typically just for Metaverse real estate; if you want to own some of this, take a look at:

If you're interested in buying or selling Metaverse land, your best bet would be to head to either OpenSea or Rarible. These marketplaces are two of the largest in the space and have plenty of projects, digital real estate, and digital assets to choose from.

OpenSea

OpenSea is arguably the most popular NFT marketplace and the best for buying or selling digital real estate. The marketplace has gained investment from huge names, including Mark Cuban and Kevin Durant. Currently valued at $13.3 billion, trading volume reached a record $2.4 billion in January 2022 alone.

Rarible

Another great marketplace to find digital real estate to invest in, is the main competition to the previous marketplace. Rarible is a DAO-governed and open-source eponymous protocol. Rarible allows you to buy into the two most popular metaverse crypto projects, including Sandbox and Decentraland.

Want to know more about the best NFT marketplaces, we've got a whole article dedicted to just that.

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