Wealth spillover effects from metaverse cryptocurrencies like MANA and SAND have been documented to influence virtual real estate, specifically LAND NFTs. Historical parallels are drawn with the 1920s Florida real estate bubble, highlighting the lack of earning opportunities in current metaverses. The impact of these cryptocurrencies is rapid, with wealth effects manifesting in weeks, unlike past bubbles that lasted years. Although real estate wealth evaporation can lead to crises, the effects of NFTs as collateral are limited in the current ecosystem.
Real estate bubbles have occurred throughout history. In the case of metaverses, opportunities to earn real estate income are not established, mirroring the 1920s Florida bubble.
Rather than being 'elements of substance', real estate prices were based on the self-delusion that the Florida swamps would be wonderful residential real estate.
The wealth spillover effect from metaverse cryptocurrencies into virtual real estate can happen within weeks, contrasting with the decade-spanning bubbles of the past.
The evaporation of real estate wealth can cascade into a systemic crisis; however, the impact of NFTs on the current metaverse is limited as loan collateral.
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