There are many, many, many metaverse tokens out there…
My problem is - what are they based on?
Think of normal currencies like the euro, yen or dollar. These currencies get their value from the number of transactions taking place in the currency and how many people use them.
All commodities are priced in dollars. This is one of reasons it is the world’s reserve currency.
So for these currencies to become massive currencies, there needs to be substantial trade happening in that currency. So how about it? How much trade is going on in these currencies?
Lets look at one example. Decentraland’s internal trading:
The purchase of property has gone through the roof in the past few months. But is this genuine trade?
In a normal economy, trade brings in foreign currency and this increases the incomes of the population. They then can afford to pay more rent and the house prices rise.
Decentraland has no serious internal trade, it is just speculators driving up the price of property into infinity.
By comparison, Second Life’s currency supports a large number of trade on a daily basis (like USD, EUR etc) and it has a real world GDP of $600 million…