As metaverse real estate has rapidly grown as an asset class, it was only a matter of time before lenders got in on the game. With prices for digital “land” plots in the most popular metaverses — such as Sandbox, Decentraland and Superworld — rivaling or exceeding that of physical properties, funding such investments with ease has been a growing focus.
And a number of players have stepped out of the woodwork to provide that service.
While the financial terms and identity of the client is unknown, TerraZero revealed how the mortgage itself works; holding the digital property as collateral in the form of a non-fungible token, they collect monthly payments from the borrower until the loan is paid in full. In the meantime, the borrower is granted full “deployment rights”, giving them access to the plot, and the ability to build, develop, or utilize it however they like — just like in a physical mortgage arrangement.
“TerraZero’s vision is to build and provide the tools that bridge the real world with the Metaverse,” stated TerraZero’s founder and CEO, Dan Reitzik. “An entirely new economy is emerging and we want to enable entrepreneurs and others with similar products and services for the Metaverse that are available to them in the real world. Mortgages and financing availability will expedite the development and adoption of the Metaverse, and we are excited to be at the forefront of this new and exciting economy.”