The Metaverse Real Estate Fund was popular among investors, with the $75 million reservation max being met within a short time. The fund focused on purchasing virtual real estate in NFT games, such as Sandbox, Axie Infinity, and Decentraland. The land was then held long-term and developed into virtual shopping malls, event spaces, and other communities. These communities accrued ‘rent’ similar to real estate and provided ongoing income to the fund. As the metaverse land accrued in value, investors in the fund received dividends like a normal real estate investor and could eventually sell for a large profit.
The appeal of the fund was driven by its performance, with a return of 145% on invested capital between its initial launch in March and the December Regulation A raise. However, the decline in the cryptocurrency market and the SEC’s crackdown on the industry have posed significant challenges to the fund’s operations.
The fund primarily focuses on buying up virtual real estate in NFT games like Sandbox, Axie Infinity and Decentraland. After purchasing the land, the idea is to hold it long-term, while continuing to develop it into virtual shopping malls, event spaces and other communities. These types of communities can accrue ‘rent’ similar to real estate and provide ongoing income to the fund. This means investors in the fund get dividends like a normal real estate investor would, and as the metaverse land accrues in value, they can eventually sell for a big payday.
Republic is the third-largest equity crowdfunding portal in the U.S. and the owner of the largest U.K. portal, Seedrs. In March of 2021, they launched the “Republic Realm Metaverse Real Estate Fund” available exclusively to a handful of accredited investors. In December of 2021, they launched a Test the Waters (TTW) Regulation A campaign to open it up to all investors. It was incredibly popular and maxed out the entire $75 million reservation max in a very short time.
The SEC has now officially shut down the Regulation A offering, and the fund will no longer be progressing. Republic stated that the SEC feedback and other regulatory events since the fund’s launch have led them to believe that there is no longer a path forward for this offering. However, the fund itself does not seem to be closing entirely, and the company is working on making necessary adjustments to eventually bring a similar offering to market.
Although this offering has been cancelled, there are still many blockchain-based investments available in the equity crowdfunding world. One such example is Gameflip, which is raising funds on StartEngine and has already received $10 million from venture capitalists and over $810,000 from the crowd for its marketplace for gamers. The marketplace includes both blockchain and non-blockchain-based digital assets that gamers can buy and sell.