Does unit of account affect willingness to pay? Evidence from metaverse LAND transactions✰

Voraprapa Nakavachara and Kanis Saengchote

Finance Research Letters, 2022, vol. 49, issue C

Abstract: 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 blockchain-based 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.

Keywords: Metaverse; NFT; Unit of account; Willingness to pay (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:49:y:2022:i:c:s1544612322003154

DOI: 10.1016/j.frl.2022.103089

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