While mowing your lawn in the spring (partly because it’s your social duty to your neighbors, but partly because if you do not, your homeowners’ association (HOA) sends ugly mail and gives you a fine), so take a moment to Appreciate these things that HOA does to help protect your property value. It gives you influence on how your neighborhood is run, for example, and it allows you to express your concerns if something looks like exaggeration or if crime becomes a significant issue near you.
Many people worry about the same kind of problems with their metaverse property. Who decides where your metaverse platform goes? What if bad things get installed and start causing problems? In short: how do you protect your interests in the meta-verse, and who is really responsible for these things?
For larger platforms offering metaverse real estate backed by non-fungible tokens (NFTs) offering proof of ownership, the answer is simple. Your metaverse world has something like a HOA that gives you voting rights and a giant voice in the future of your platform. It is called a decentralized autonomous organization (DAO) and it is the best way for an investor to ensure that their metaverse real estate is protected in the long run.
What is a DAO?
A DAO is an organization that gives participants in various decentralized projects – for example, a metaverse platform or a popular NFT offer – the opportunity to have full control over the future of the project in question. As a member of a DAO, you can vote based on whether you have a specific recognized property in the project. This may mean that you own an NFT-like digital land, or that you have a particular cryptocurrency.
In the case of the meta-verse, DAO-controlled platforms can as Decentralized (MANA 1.71%), hold regular town hall meetings where land and global currency owners can meet to discuss issues of interest to them, propose new projects or vote on new rules or amendments to existing bylaws. In many ways, it’s very similar to your HOA (minus mowing).
How DAOs protect real estate investors from the meta-verse
Buying land in the metaverse can already be a very risky purchase. It’s a country you can not touch, stand on or visit in the real world, not to mention how many people do not know how to invest in real estate, so it’s understandably scary. This is due in part to the new type of investment; it’s just not something that has been done before. Another factor is that investors are often not very aware of how these worlds are governed and the day-to-day running of something that is both similar and so different from the real world.
DAOs are not present on all metaverse platforms, but those that offer a much richer ownership experience. Many potential metaverse platforms are really just gaming platforms that have items available for sale. You may be able to buy things, but you may not always have the right to sell them, or even when you do, you may have no control over what the platform owner decides to change the graphs or the associated rules. with them.
With a DAO in place, however, you and the other owners decide these things (and many more). You have a strong claim in the world, and you elect the board members who make the most vital decisions that make this world go round.
Choose metaverse worlds with DAOs for long-term success
Although Decentraland was the first to offer a DAO structure to landowners, it is not the only one that has done so. Sandboxes (TRUE 3.88%) is also in the process of launching a DAO whose details are not currently available. However, it will probably follow something along the lines of Decentraland’s structure as an example, as it is a very successful model.
Other blockchain-based worlds may well follow this path, and quite frankly, they should. Because they are already built on a blockchain protocol, they have the ability to implement tools like DAOs and other decentralized governance mechanisms. This would give landowners in new worlds more control and security over the value of their properties.
For the best long-term value for your investment, choose metaverse real estate in worlds that give you (and other owners) control over them using a DAO or similar management. Otherwise, the land you own in virtual worlds is always at the mercy of platform developers who could literally change everything from one day to the next and without warning.