Passive income opportunities in the metaverse have been gaining momentum, and top metaverse platforms like Upland, Decentraland, Somnium Space, Voxels, and the Sandbox are at the forefront of the industry’s growth. These platforms offer many ways to earn passive income, and early adopters have already begun taking advantage of these opportunities. For instance, landowners in Somnium Space earn a living from rental fees, while game makers in the Sandbox, enterprises that sell billboard spaces in Decentraland, and players who seize idle gameplays in gamified metaverses are making money.
To gain a better understanding of the approaches currently in use, let us examine the experiences of those who are already making passive income in the metaverse.
Here are some ways to earn passive income in the metaverse:
a) Own property in Metaverse
Chris Bell, an investor in the Somnium Space metaverse, is a successful example of a metaverse landlord. He earned $18,000 in 2021 by renting out his 100 plots of land. Bell determines the land’s current value by analyzing recent secondary market sales on OpenSea and rents it out to tenants for an annual fee that is 10% of the property’s current value, aiming for a 10% annual return relative to the current value of the land.
Leasing land is a popular way to earn passive income in the metaverse because it creates a win-win situation. Tenants can build their own experiences on the rented land, which can generate new income for them, as we will discuss in the following section.
Leasing lands is permitted on all popular metaverse platforms, but the drawback is that deals need to be closed outside of the metaverse marketplace, which can be a security concern. To overcome this problem, new business models, such as the partnership between LandWorks and the Voxels metaverse, are being developed. LandWorks is a permissionless lending protocol that connects landlords with tenants through a decentralized marketplace, allowing renters to securely search Voxels’ lands. Currently, the marketplace is integrated with Decentraland land plots.
Decentraland, one of the largest metaverse platforms, has also introduced built-in land rentals to facilitate leasing without leaving the Decentraland marketplace. Landowners can list their properties directly on-chain by approving the smart contract for rent and letting the tenant use the land on their behalf by signing the listing prompts.
b) Offer different and unique experience
Generating passive income in the metaverse by creating experiences on land plots is another option for landowners and tenants. You can earn entry fees from visitors by creating a wide range of experiences like mini-games, shows, art galleries, dioramas, interactive tours, and shops. You don’t have to do it all by yourself. You can hire developers and designers to assist you in creating these experiences.
The Sandbox is a platform that offers a variety of such experiences. They provide builders with a collection of tools to make creating unique experiences on virtual lands much easier. Game publishers can charge players for visiting their plots and playing games on them.
The Sandbox also provides two funding programs, one for game makers and the other for creators who design game assets. Thus, many talented game artists, designers, and agencies create Sandbox experiences, which you can hire to build custom experiences for you.
Other metaverse projects offer similar opportunities that you can take advantage of. For instance, Blake Hotz hosts immersive events in Somnium Space, ranging from horror houses to try-on shopping experiences.
Expanding metaverse lands through experiences benefits landowners, as it increases the value of their land plots. Sam Huber’s Admix company, which recently merged with Landvault, develops buildings on the lands before renting them out to clients. As an example, in partnership with L’oreal, Admix built a display of oversized perfume bottles in Decentraland. According to Huber, this business model can yield profits as high as 70%.
c) Build billboards in metaverse
Similar to the real world, businesses in the metaverse also want to advertise their services in high-traffic areas to reach potential customers and increase brand awareness. Therefore, earning money by placing ads on metaverse billboards is another opportunity to make money effortlessly.
Virtual real estate companies are leveraging the potential of metaverse billboards by investing in attractive land plots and creating ad spaces on them. For example, Decentraland Architects offers three types of billboards in Decentraland, and Metaverse Billboards focuses on the Voxels, with over 250 billboards available. Some companies, such as Lemma, offer billboard solutions that integrate physical and virtual worlds.
Building billboards in the metaverse is a straightforward process. Individual investors, whether they own or rent metaverse properties, can use their investments to follow in the footsteps of these businesses and earn passive income.
Generating passive revenue from metaverse land assets opens up many possibilities. However, there are two additional options worth considering.
d) Explore staking and other crypto rewards opportunities
Most metaverse projects have their own cryptocurrencies, such as MANA for Decentraland and SAND for the Sandbox. These currencies are in constant demand as users need them to engage in metaverse activities. As a result, they offer opportunities to earn interest through decentralized finance (DeFi) methods like staking and yield farming.
To take advantage of these programs, you can invest in the metaverse’s native currency and lock your tokens in a liquidity pool for a set period to earn interest. Some metaverse projects offer these programs directly, such as the Sandbox’s past offering of SAND staking on Polygon without pairing it with another currency. It’s essential to follow the official channels of your desired metaverse to learn about these opportunities.
Centralized exchanges like Binance also offer staking programs, with Binance currently providing a locked staking program for SAND that offers up to 14.50% reward rates. Additionally, NFT staking opportunities are available in the crypto space. For example, in the play-to-earn game with metaverse elements, Axie Infinity, in-game asset owners can stake their NFT assets and take out loans up to 30% against their value.
Other metaverse projects offer unique ways to earn interest, such as Upland, which is a monopoly-like metaverse mapped to the real world. Newly-minted Upland property owners can earn up to an annual yield of 17% of the property’s mint price in UPX, the primary currency of the metaverse. However, players must level up in the game to convert Upland yields to USD.
e) Unlock rewards with collected tokens from games
One way to make passive income in the metaverse is by collecting game tokens. Game metaverses offer both fungible and non-fungible tokens that can be collected by players, providing a new way to earn passive income.
For example, Alien Worlds has a token mining process inspired by cryptocurrency mining, where players can accumulate the game’s native currency, Trillium (TLM), by playing the game. This can then be exchanged for other cryptocurrencies to gain real-life monetary value.
Other metaverses incorporate play-to-earn mechanisms that require minimal effort, such as fusing or breeding to create new and improved in-game NFT items, which can then be sold on secondary marketplaces. My Neighbor Alice offers an interesting passive income option through NFT collaterals, where a percentage of the price of an NFT that a user buys goes to their collateral account. When they sell it back to the system, the previously locked collateral amount is paid back to them.
To take advantage of these opportunities, players need to spend time exploring different game metaverses and understanding the various ways in which they can earn passive income.
Passive Income Opportunities in the Future Metaverse
The future metaverse will be an immersive environment enabled by hologram, AR, VR, and AI technologies. It will offer both exclusive virtual experiences and smooth transitions across multiple realities. This convergence will open up numerous business prospects, including novel revenue streams through passive income strategies. While new monetization methods may surface with emerging metaverse concepts, conventional Web2 business models will likely continue to adapt to the metaverse.
For example, creating and selling online courses multiple times and dropshipping are proven ways to make profits in the current internet version. The metaverse’s integration will lead to new e-commerce income forms. Social media advertising and product recommendation are other effortless methods to generate revenue that will likely undergo adaptation to the new internet when the metaverse combines with decentralized social media apps.
However, keep in mind that living off passive income requires hard work, regardless of the future opportunities that may arise.