(Yicai Global) Dec. 13 -- A Chinese celebrity caused a social media storm when he said that he has recently bought land on the decentralized three-dimensional virtual reality platform Decentraland, with some netizens saying it is a scam and others saying it is a valuable digital asset.

Singer JJ Lin has bought three pieces of virtual land on Decentraland, which is made up of 90,601 plots in the metaverse, he said. His purchase marks a growing trend.

Virtual land is worth investing in as it is a tool for entering the metaverse world, said Shi Yue, a blockchain industry insider who owns five digital plots. “Whether the value of virtual land is driven by intellectual property or traffic, it is a definite trend,” she told Yicai Global.

Buying land in the metaverse is speculation, Liao Xuhua, online entertainment sector analyst at Analysys, told Yicai Global. It’s just an efficient way of investing in virtual currency. "Essentially, it is the same as when I pick up a stone and I sell to you for USD1 million. These methods are all pretend, and the core purpose is to speculate and trade."

But the value of virtual land is surging. Prices jumped nine-fold last month from September, and the number of traders reached a record 28,000, an increase of nearly two and a half times from October, according to decentralized app tracker Dapprader.

Metaverse speculation is driven by the digitization of assets, with blockchain and decentralized finance creating new digital assets, said industry insider Frank Li.

Republic Realm, a metaverse real estate firm, just bought a plot of land in the virtual world The Sandbox for a record USD4.3 million, enough to buy two houses in the center of Beijing. Republic Realm now owns around 2,500 digital lots on 19 different metaverse platforms.

Both Decentraland and The Sandbox saw unprecedented traffic and transactions last month, with virtual land deals reaching USD228 million, the best month to date and up nearly seven times from October, according to Dapprader.

The Sandbox secured USD93 million in a new funding round led by Japan’s SoftBank Vision Fund in November. Since then, prices have soared ten times, a player said.

Buying land parcels on a high-traffic metaverse platform can be understood as purcahsing land in the center of a city, a user said. One can build exhibition spaces, concert halls or houses for rent to earn digital tokens from the high traffic that passes through. Moreover, as it is blockchain-based, the lots will not disappear should The Sandbox close down and land ownership will not change.

Editor: Kim Taylor