In October 2021, Facebook rebranded itself as Meta and announced it was betting the company’s future on the “metaverse” — a term from the 1992 sci-fi novel Snow Crash that referred to a shared virtual world people would inhabit. Mark Zuckerberg’s announcement put the concept on the global radar. Crypto projects had been building metaverses for years, and suddenly they were in the spotlight.
The two most prominent crypto metaverses were Decentraland and The Sandbox. Both were virtual worlds where users could buy land, build structures, and interact with each other. Both used NFTs to represent land ownership. Both had native cryptocurrencies (MANA and SAND) that could be used within the ecosystem. During late 2021, both exploded in value. A single parcel of virtual land in Decentraland sold for over $2 million in November 2021.
The mainstream narrative quickly focused on crypto metaverses. Brands like Gucci, Adidas, and Samsung bought virtual land. Celebrities announced virtual concerts. Companies planned virtual offices and stores. The total value of NFT-based virtual real estate exceeded $1 billion. It seemed like a genuine new frontier — the internet was about to become a 3D shared experience, and early movers would own valuable digital real estate.
But the reality was disappointing. When users actually logged into Decentraland or The Sandbox, they found mostly empty worlds. Daily active users were in the hundreds or low thousands — nowhere near the numbers needed to support multi-billion-dollar valuations. The graphics were clunky, navigation was confusing, and there wasn’t much to do. The experience felt like a low-budget version of games like Second Life or Minecraft that had existed for years.
When the crypto bear market hit in 2022, metaverse projects were devastated. Virtual land prices crashed 90% or more. Brands quietly abandoned their virtual properties. Meta (the company) burned billions on Reality Labs with little to show for it. The metaverse dream, at least as it had been hyped, was largely a failure. But the underlying technology remains interesting, and some believe that with better graphics, better tools, and killer apps, the metaverse will eventually arrive — just not on the timeline everyone expected.
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