Journal
FINANCE RESEARCH LETTERS
Volume 49, Issue -, Pages -Publisher
ACADEMIC PRESS INC ELSEVIER SCIENCE
DOI: 10.1016/j.frl.2022.103089
Keywords
Metaverse; NFT; Unit of account; Willingness to pay
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LAND is a non-fungible token in The Sandbox metaverse representing virtual real estate ownership, and users pay different fees when settling transactions with SAND, wETH, or USD. The choice of cryptocurrency/token settlement unit affects users' willingness to pay.
LAND is a non-fungible token (NFT) representing virtual real estate ownership in The Sandbox metaverse, a digital world built on the Ethereum blockchain. The open nature of a blockchainbased metaverses like The Sandbox allows users to transact in multiple denominations/currencies. We analyze more than 71,000 transactions and find that when transactions are settled in The Sandbox's native utility token (SAND), users pay 3.4% more compared to ETH (in effective USD prices). There are also evidences that users pay less when transactions are settled in wETH and USD-pegged stablecoins (USDC). Thus, the cryptocurrency/token settlement choice (i.e., unit of account) matters for willingness to pay.
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