The Virtual Technology landscape is evolving rapidly. Virtual reality is forecast to reach $30 Billion (US) by 2020 and major brands are lining up to do battle for dominance in the market. VR companies have raised multi-million dollar backing in venture funding but there are growing numbers of start-up's that are selling their own crypto currencies to help fund their development and this is attracting speculators hungry for profit. It is into this bubbling cryptocurrency market that High Fidelity have just announced they will cash out and exchange their crypto coins for U$ dollars.
The currency is called HFC and is tied to the US dollar at a fixed rate (100 HFC = 1 USD). The High Fidelity company controls the rate to prevent inflation in an attempt to avoid speculators treating it as an investment like happened to Bitcoin. Rosedale thinks there is great value in a digital currency that has low speculation value.
Other virtual worlds like Decentraland have also issued a crypto coin "Mana" and then used it in a bidding auction selling 10-metre-by-10-metre plots of virtual land. Last August the two Argentinian co-founders, Esteban Ordano and Ari Meilich raised 24 million dollars in an initial coin offering (ICO) and sold out so fast that the vast majority of users waiting for the launch never got any of their orders filled. Apparently, over 28 million dollars change hands in the bidding war, making it what Decentraland calls the largest ever virtual land sale.
Decentraland uses the Ethereum blockchain to store information about land ownership and its content so they are using similar methods to High Fidelity. They are using Ethereum smart contracts to validate that modifications were made by the owner of the land and content will be distributed using the IPFS network, while data hashes are stored in the blockchain.
They base everything on the theory of land scarcity. "Without scarcity, most LAND would be left abandoned, which would hurt content discoverability and the user experience overall." they say on their web site. Incredibly, some 10m by 10m parcels of land actually sold for over $120,000! So the hype must work.
This does seem fantastic when you consider that land is so cheap in the Opensim Metaverse, one wonders why anyone would buy land for such a high price in Decentraland - land that doesn't even exist yet I might add! That's right, they still have to finish building the virtual platform. The founders have hit on the idea they can fund development by selling crypto coins so they have to push the scarcity factor to the speculators. But there it is, this is all about speculation and the hope that the land will rise in value at some point because there is only a limited amount. They are effectively trading futures. It is not a new idea though if anyone remembers people bidding up the price of virtual land to unheard-of prices when Bay City was launched in Second Life.
|Talla visits Aech's Garage from the movie, Ready Player One in Sansar|
|Talla visits High Fidelity too.|
|AI driven creatures in VU not too unlike Opensim has had for years!|
|This is an example of Black Dragon and in the HiFi forums Niran says "All in all Second Life could do much much more, what Second Life is really lacking is someone skilled and willing enough to add to the graphics." This can also be said of Opensim.|
Rosedale is ever the forward thinker so I have faith he can make it work but it remains to be seen if crypto will give High Fidelity the edge and help to propel the platform onto the world stage as a major player, something he never managed with second Life although it is still very profitable for Linden Lab, the Land Barons and the top content brands that hang in there.