Upcoming play-to-earn blockchain game Illuvium closed a virtual land sale worth over $72 million, defying crypto's bearish market sentiments. Furthermore, it limited the transaction fees to about $20 by using the Immutable X layer-2 scaling solution.
Illuvium sold the digital land plots via dutch auctions from June 2 through June 5. In total, 19,969 digital land plots were sold to investors and prospective players, with nearly 282 plots going on sale every hour.
For the 19,969 plots, Illuvium used a dutch auction format where the price of each plot gradually decreased for each batch. The Illuvium plot prices were as follows:
Tier 1 plots - prices started at 2 ETH (about $3,700)
Tier 2 plots - prices started at 6 ETH (about $11,100)
Tier 3 plots - prices started at 20 ETH (about $37,000)
Tier 4 plots - prices started at 80 ETH (about $148,000)
According to the rarity and volume of in-game resources, a land can produce, the auctioned plots are tiered between levels 1 and 4. Later this year, Illuvium will launch on Windows and Mac computers, with plans to conduct more land sales.
The land sales brought in over $72 million for Illuvium. According to a tweet, the creator plans to redistribute about 4,018 ETH (over $7.4 million) to ILV stakers. Furthermore, 239,388 of the game's sILV2 tokens (about $22 million) would be burned to reduce the total supply.
The official post regarding the planned burn reads, "Inflation bad, deflation good."
Ultimately, the Illuvium game world will feature 100,000 total land plots, with holders receiving access to various in-game benefits. It includes extracting fuel you can sell to other players for a potential profit. Also, landowners receive 5% of the in-game revenues that the land plot generates.
Illuvium's land NFTs are based on the Immutable X layer 2 Ethereum scaling solution. Thus, it enables cheaper, faster, and more energy-efficient transactions. Warwick estimates a 60% reduction in gas fees leveraging Immutable X. Accordingly, users only had to pay about $20 per transaction on average.
To further reduce gas fees, all future sales will entirely be held on Immutable X. "Nearly all Ethereum NFT sales result in wasteful bids that reward miners and cost the buyer. Gas wars should now be a thing of the past," stated Warwick.
By contrast, BAYC's Otherside sale was doomed with issues. Buyers paid an average gas fee of $6,000, which went as high as $14,000. At that time, Ethereum became congested as buyers tried to get their orders filled as quickly as possible.
Virtual land is rapidly becoming a formidable asset class within Web3. MetaMetric Solutions estimates that over $501 million worth of metaverse land sales were closed in 2021. In fact, $85 worth of Metaverse land was sold in January 2022 alone.