Introduction: Cryptovoxels is an interesting and hardcore NFT concept blockchain game. DappReview has long wanted to delve into the gameplay of this game. This time, we have translated Andrew Steinwold's 6000-word article. Andrew has been involved in this game since June last year and has invested heavily in land, which has now increased by 30 times, earning both fame and fortune. In this article, Andrew reviews and analyzes Cryptovoxels' success factors, future prospects, and his investment logic from multiple perspectives.

Author: Andrew Steinwold

Translation & Editing: DappReview Editorial Team

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Note 1: This article does not constitute investment advice and reflects only Andrew Steinwold's personal views.

Note 2: This article is lengthy. To ensure readability, some paragraphs have been loosely translated. For the original English content, please refer to the link at the end of the article.

Cryptovoxels is a rising star that may one day become the most influential virtual world on Ethereum. Its developers have adopted a conservative approach to development, allowing the game to organically grow in a cost-effective manner. Such cautious development is not uncommon in industries in their early stages, such as the current NFT industry. It is gratifying that Cryptovoxels has found a niche in the crypto art community. The future potential of the crypto art community is unimaginable and may lead a new era in art history. If Cryptovoxels remains true to its mission and follows in the footsteps of DecentralandDCL, aiming to become the highest valued virtual world on Ethereum is not just a dream!

In June 2019, I wrote a blog post discussing why I was bullish on Cryptovoxels. In that post, I specifically analyzed whether Cryptovoxels presented a potential investment opportunity. At that time, I already equated the land in Cryptovoxels with Binance's BNB token, and as you know, BNB has increased by 30,000%. So, I can confidently say now that I saw the potential in Cryptovoxels' land early on and I still believe in it! Below, I'd like to delve deeper into my thoughts on Cryptovoxels.

What is Cryptovoxels?

Cryptovoxels (referred to as CV) aims to build a blockchain-based virtual world. Simply put, it's a completely open free sandbox game where players have no specific goals or missions and can do as they please in the game. For more information about the game, visit: https://dapp.review/dapp/750/Cryptovoxels

Founding Stage

The founder of Cryptovoxels is Ben Nolan, and he indeed has two brushes in running the project. Building a virtual open world on Ethereum is no easy task. Before CV went live, Decentraland (DCL) was the only similar project on the market, and it's fair to say that CV is born out of DCL. Ben Nolan had worked at DCL for a period, and I believe he leveraged his understanding of DCL's strengths and weaknesses to develop CV.

Until the launch of CV, Ben did not quit his job. He continued to develop the project in his spare time. He knew very well that this was a new and challenging project that did not require a large budget but rather a light approach. Many deep-pocketed investors waved money at him, but he rejected them all in order to have the freedom to create. This grassroots entrepreneurial approach allowed him to maintain control over the entire project, making all key decisions on his own. Without a large team overhead or office rent, Ben worked on Cryptovoxels in his garage (jokingly called the Cryptovoxels garage). His fundraising model was quite clever, with the fundraising amount increasing as the platform developed.

In CV, there is a limited number of land parcels (a total of 3026 in the original city), and Ben sells some of them every few weeks. Initially, sales were slow, and prices were low. New land parcels often went unsold, but with more and more players joining the game, each new land parcel put on the market was quickly sold out. As the user base grew and demand for land continued to increase, Ben timely raised the price of land, filling his wallet more and more. Note that Ben only increased prices based on user growth, avoiding exorbitant land prices that would lock users out of the market. Given the current sales situation, the project is expected to continue operating for more than two years.

One year after the launch of CV, Ben finally resigned and went all in on development. In the second half of 2019, Ben set up an office in his home in Auckland, New Zealand, still maintaining his thrifty approach. Only in January this year did Ben hire his first full-time employee, Marcus. Before that, when things got busy, he would occasionally invite friends to help at home. It's hard to believe that product development could still operate this way. Typically, the process would involve presenting a white paper or a PowerPoint to investors, renting an office with the money gained, and hiring a few employees to cram into the house.

What's most surprising is that to this day, Ben has not bowed to the temptation of money. Countless checks were presented to Ben, some from personal funds and others from venture capital institutions, yet none caught Ben's eye. He is committed to self-reliance to maintain creative freedom and grow and profit in his preferred manner. For example, venture capitalists would encourage Ben to monetize CV by having users pay a monthly fee to use the platform. Fortunately, Ben persisted in his slow and steady growth approach and reaped rewards early on.

Current Status

Now, let's delve into the several factors contributing to Cryptovoxel's success:

• Product-Market Fit
• The Stage for NFT Artists
• Social Space
• Usability
• Ease of Building
• Monetization Methods

Product-Market Fit

The definition of Product-Market Fit is having a product that meets specific and significant demands in the market. With the rapid development of the crypto/NFT market, more and more users are starting to hold NFTs and are in need of a platform to showcase their NFTs, which Cryptovoxels has developed to meet market and user demands. The desire to collect is ingrained in human DNA, and people have come up with the following reasons for it:

• Self-display
• Enjoyment
• Utility
• Investment

Players can showcase their collected NFTs in the virtual world for face and profits, aligning perfectly with the above reasons, right?

• If you want to showcase yourself, you can impress others with endless CV land;
• If you are an NFT collector, you can display your prized NFTs in CV;
• If you are a utilitarian, you can use handy tools on your land to create incredibly creative things;
• If you are here just to invest, it's great to let others buy your little items.

On this basis, CV can serve the entire NFT ecosystem.

The Stage for NFT Artists

In fact, in the NFT community, the crypto art community is the most enthusiastic about embracing CV. Every crypto artist hopes their work gets the best showcase. The buildings in CV are very intuitive; users can build a simple gallery within an hour and display their NFT art, which also serves as a simple art marketplace where other users can directly purchase your work. The network effect of crypto art is explosive, with more artists joining CV, bringing in more buyers and generating continuous new liquidity. These crypto artists act as viral machines, always able to create magnificent galleries in the game and share them on social media. Once fans see them, they too will come to join CV, leading to more user engagement and a series of new dynamics.

Social Space

CV is also a social space: if you wish, it can be a 3D version of Facebook. Here, everyone doesn't have a personal page but land parcels where you can place anything you want. People can also gather in this online world. For example, user Conlan established the Gangam Art Clut, a gathering where people worldwide who love crypto art can participate. Gatherings are a magical use case that can expand into many verticals. There have been many discussions about online art exhibitions. With the continuous increase in users, I can foresee users of various NFT projects gathering to discuss their collections: Axie users can meet in the Axie community, Cryptokitty players can gather in the Cryptokitty community... Believe me, as a social tool, users will always find new ways to play on CV.

Usability

Cryptovoxels is cross-platform. In the past, games were limited to a single platform. When I was young, I couldn't play "Call of Duty" with my friends because they had a PS3, and I had an Xbox 360. In recent years, these games have started to be released on as many platforms as possible: PC, Xbox, PS, smartphones, and more. Cross-platform support allows explosive growth in game users. Games with hundreds of millions of users, such as "Fortnite," "Minecraft," and "Rocket League," have also achieved success through cross-platform support. CV allows login via web, VR devices, and even smartphones. Cross-platform login is highly beneficial for a project in its early stages. Just web and smartphone access have opened the door to the vast majority of people worldwide. Users only need to open the web, click "Enter the World," and they're in.

Ease of Building

Building things online is very easy. In December 2017, "Minecraft" reached an active user base of 74 million. This was due to many factors, but multi-platform compatibility and simple construction were the main reasons. Like "Minecraft," CV is open to everyone. Creating incredible works like those below requires advanced skills, but most users can quickly build simple structures.

Devil, Artist/Virtual World Architect

Alotta Money, Artist/Virtual World Architect

Allowing novice users to quickly build items is a huge advantage; the building threshold on some platforms is astonishingly high, forcing those without 3D modeling or programming skills to take detours.

Monetization Methods

The most sticky platforms/games often allow users to earn money in some form. "Minecraft" allows users to have their servers; as server owners, they can sell digital products or memberships. Roblox goes further, allowing anyone to build complete games on their platform and profit as they wish. Fortunately, Cryptovoxels is designed to be very open and connected to Ethereum's global financial infrastructure, allowing users to profit through in-game assets. As mentioned, crypto artists can directly sell their NFT works online in CV, but there are also other ways to profit. The first sustainable profit model created by the CV team is character skins.

Cryptovoxels User MJMoonbow

Anyone can create character skins and sell them on the open market. We also see users renting land parcels from other players. CV user Conlan developed an interesting model: buying a set of adjacent land parcels, developing a core theme with them, just like real estate developers. He acquired row land parcels in Gangnam and created an interesting theme, making the area very popular and increasing land prices. After the popularity of Gangnam, users began renting land in this area, leading to another way of making profits.

Currently, it's still early to achieve profits on the Cryptovoxels platform, but as it develops, we will continue to see different profit experiments. One interesting method is the built-in games on the CV platform.

Games within Games

I believe in the next stage of CV's development, mini-games will be embedded within buildings. Once users can play many games within the world, the functionality of Cryptovoxels will increase dramatically. These games will start off simple, but as time goes on and more games are added, the playability and complexity of the games will improve. There have been discussions about creating a shooting game that allows users to shoot blocks and build simple casinos. If Decentraland is a guide on what can be built, then Bence Varga's games in Decentraland's mini-games showcase what is to come.

To further illustrate, this overall large game is taking place on several LAND parcels within the Decentraland virtual world. If my understanding is correct, Bence Varga has created a game engine that allows users to move their perspective in a seemingly vast world, but the actual "physical" space of the game is small (DR Note: DCL's land resources are expensive, so the shrinkage of physical space is significant for building games within DCL). If this technology is transplanted into Cryptovoxels, the creation of such games will have almost no limits.

What will the future of Cryptovoxels look like? As the saying goes, "software is eating the world," and this includes our physical world. It seems that more and more people are living, working, and entertaining themselves in completely virtual environments every day. Many people can comfortably work from home with just a computer. Daily entertainment is available with internet-connected devices, such as streaming shows, listening to podcasts, or playing games. These broader macro trends, such as the rise of remote work and societal acceptance of games, are positioning platforms like CV to gain immense value in the years to come. In my view, these platforms represent the initial iterations of the virtual world.

Virtual World (Metaverse) 1.0

I believe the missing ingredient in a true virtual world is blockchain. Blockchains like Ethereum can achieve digital scarcity and true digital asset ownership. The true ownership of assets instills confidence in people to invest more time, money, and energy into their interactions with virtual economies and environments. Most importantly, it allows developers and users to immediately enter the globally established financial system built on Ethereum. With these benefits, users and developers will dedicate more time and money to create larger, more robust virtual economies. This is the dawn of a true Virtual World 1.0. I disagree with the idea that a true virtual world can exist based on non-blockchain assets, but that's another matter. Since I have carefully explained the reasons why I am bullish on Cryptovoxels, I will further explain why I purchased specific Cryptovoxels parcels.

Obviously, I am bullish on Cryptovoxels in the long run. Over the past year, I have slowly acquired advantageous terrain on the Cryptovoxels map. I have never sold a parcel, valuing the long-term potential of NFTs and the virtual world over short-term gains. And Cryptovoxels seems to be leading in both these markets.

Reflecting on my first investments in CV, back then, I firmly believed that height was a crucial parameter for game parcels. For this reason, I acquired some adjacent parcels near Frankfurt (a region in the game) because it had the highest height limit in the game at that time. No one would be foolish enough to buy a single parcel for over one ETH from Ben (the lead developer), except for me. My extravagant bidding for parcels caused a stir at the time, but I always stood firm in my views, and looking back now, an entry price of 1 ETH is indeed quite lucrative! The prices of parcels in the Frankfurt area have now risen to between 30 ETH and 200 ETH (January/February 2020 data).

• Elite Throughway parcels 10 and 8 were both sold for 30 ETH
• Cash Road parcel 2 was part of a 500 ETH Playa bundle but individually sold for 200 ETH

This parcel bundle should be one of the most valuable in Cryptovoxels currently. Why do I say that? First, it has the most adjacent parcels, and second, it is the highest in average height among the parcels, with 9 out of 12 adjacent parcels having heights exceeding 18! While there are parcels with higher heights in other bundles, they are not adjacent and are owned by different players.
I also made a discovery that since all new players enter the game from the center of the world (The Center, marked in red underline in the image below), land surrounding the "center" is sure to be prime real estate.

Acquiring land around the world center is not easy as most have already been sold to other players, so I had to look for takeover opportunities in the secondary market. I targeted four adjacent parcels, with three conveniently located along the path where new players are born. I strongly believe that these areas will become very popular. I spent between 1-2.5 ETH on these 4 parcels. Fortunately, the recent prices for land around the world center have reached levels of 29.5 ETH to 35 ETH.

• Buffer Crossing parcels 2 and 4 were recently sold for 29.5 ETH
• Score Fork parcel 1 was sold for 35 ETH

After several months of acquiring these "sweet" parcels, I decided to conduct a comparative analysis of parcel valuations. The results proved my intuition to be correct. Parcels with higher height limits and those around the world center have the highest values.

Personal Investment Plan

To realize the grand vision of the Metaverse, I have decided to create new businesses and experiences on these parcels. My goal is to achieve successful revenue generation in the virtual world over the next three years. It should be clarified that when I refer to the virtual world, it can be any blockchain-based virtual world, including CV, Decentraland, Sandbox, Somnium Space, etc. The ultimate goal is the virtual world, so the platform we use to achieve that goal is not important. I have a strong feeling that these platforms will eventually merge, just like the early intranets gradually connected to form today's global internet. I also want to clarify that when I speak of revenue-generating businesses in the virtual world, I mean any game or activity that brings in money sustainably. If a business can earn a stable $100 per month, I consider that a huge win because it means a native and stable business model can operate well in a completely virtual economy.

As of the publication of this article (February 2020), the market has exploded as trading volumes have increased. Monthly sales at the beginning of 2020 have reached a staggering USD 378k.
(Cryptovoxels monthly sales history, recorded on February 14, 2020, on nonfungible.com)

There have been many high-value land transactions. Some noteworthy trades at the beginning of this year include:

• 29.5 ETH (valued at USD 5,500 at the time of the transaction)
• 29.5 ETH (valued at USD 5,500 at the time of the transaction)
• 30 ETH (valued at USD 6,400 at the time of the transaction)
• 30 ETH (valued at USD 6,400 at the time of the transaction)
• 35 ETH (valued at USD 7,500 at the time of the transaction)
• 50 ETH (valued at USD 10,000 at the time of the transaction)
• 52 ETH (valued at USD 8,500 at the time of the transaction)
• 119 ETH (valued at USD 25,000 at the time of the transaction)
• 500 ETH (valued at USD 110,000 at the time of the transaction)

To make the future a reality, there is much that needs to be done methodically. The CV team must continue to evolve alongside the NFT market. The number of users needs a significant boost from the current 460, and I hope new users will not be deterred by land prices, with more original city unexpectedly land that can be developed. CV needs to remain a gathering place for NFT collectors and players. Users with different games and collectibles need space to meet, team up, and showcase their assets. Hosting a Gods Unchained tournament in CV or partnering with Axies users for real-time battles would be exciting. CV especially needs to maintain its lead in NFT artwork. NFT art is poised to grow into a huge industry, potentially rivaling traditional art markets in the future, so encouraging artists to create in CV is necessary. If these things come to pass, CV has a good chance of becoming a vibrant part of the future virtual world. However, we must remember that we are not even among the first NFT players in the virtual world. Decentraland already has 3500 users, while CV has only 460. We are still in a very early stage, with much more to do, but it seems like now is the best time to truly form a virtual world in terms of technology and timing.
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DappReview Editor's Note:
To build a blockchain version of "Second Life," "Minecraft," or the grand virtual worlds depicted in "Ready Player One," many blockchain + gaming practitioners are exploring. Projects like Decentraland, Cryptovoxels have been forging ahead over the past two years, and I believe more teams will join this lineup in the future. The ideal is beautiful, but reality is harsh. According to the current state of most products' completeness and development progress, we are far from a fully immersive, richly playable game, let alone those grand and distant stories. How to bridge the gap between reality and ideals is something that practitioners need to carefully consider. The author of this article, Andrew, is undoubtedly an optimist, and of course, one may argue that financial gains of 30 times are quite attractive! From DappReview's perspective, based on the current development team and community of Cryptovoxels, the game may ultimately remain in a hardcore and niche state, after all, for most players who do not create buildings, all they can do is explore various artworks and buildings in the game. Whether the game will become more gameplay-rich with the increase of UGC content remains uncertain, and we remain cautious. After reading parts of this article, some readers may be eager to buy some parcels to earn 30 times like the author, please control your impulses. First, open the game website, take a look around, check out the Discord community, and then make your investment decision. If you truly enjoy it, any purchase is right. If you are just looking to make money, understand what you are buying and take responsibility for your decisions.
Original Link:https://andrewsteinwold.substack.com/p/cryptovoxels-investment-thoughts

This article is authorized for reposting by ChainNews, article source: ChainNews (ID: chainnewscom)

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