Thread by @larsiusprime

Major thanks to @WritNelson @maegodhavemercy and @fruity__snacks for helping me with this article!

TL;DR -- many online virtual worlds have suffered from digital land speculation and housing crises. I chronicle the history and offer solutions.

gamedeveloper.com/business/digit…

@WritNelson @maegodhavemercy @fruity__snacks Final Fantasy XIV has a housing crisis to this day, Ultima Online's persisted for at least two decades. EVE Online had one in it's early days but Ramin Shokrizade nipped it in the bud with a clever fix.

All caused by Land Speculators, who are basically scalpers.

The saving grace of your typical MMO with scarce land is that housing is an optional "nice to have" feature, not a core part of your game. It's survivable if one part of the game totally sucks and is only available at black market monopoly prices.

But if you're pitching one of these new "digital land grab" companies and land:

1) Is strictly scarce
2) Is a necessary factor of production
3) Increases in value in proximity to population growth and economic activity

You are setting yourself up for a predictable crisis.

We know what will happen because we've seen it happen before. Speculators buy up all the land and hold it, waiting for a greater fool to pay them more or extracting rent (on or off the black market) to gatekeep access.

If you have dreams of building a "metaverse" where access to scarce land matters, you are not incentivizing creators with this model, you are rewarding scalpers who count on others to produce value for the community while they sit back and extract value from inflated land prices.

For the solution, read the article!

Okay, I'll spoil it: the solution is to assess a land value tax. EVE did this and solved the crisis.

But I just found out it wasn't just EVE!

This web based game Zapoco did it too!

zapoco.com/forums/1/threa…