Founded in 2012 by Pixowl based in San Francisco, the Sandbox originally began as a mobile game where players could build their own virtual worlds. This version is still available today as the Sandbox Evolution. In 2017, Pixowl announced that it would turn the Sandbox into a 3D game built on the Ethereum network. This would allow every in-game item that users create to exist as an NFT. In 2018, Pixowl was acquired by Animoca Brands based in Hong Kong. Its Development is coordinated by the Sandbox Foundation which is made up by over 100 developers in 32 different countries. The Sandbox raised $7 million USD from 3 SAND token sales in 2019 – 2020. It also raised millions (USD) more though LAND sales starting in 2019.
The Sandbox’s Metaverse is made up of 166,464 plots of LAND. LAND is an ERC-721 token (Ethereum’s NFT standard). LAND tokens can be grouped into estates which can be owned by a single player or a district which is owned by 2 or more players. LAND can be edited and customized using the VOX edit software. VOX edit is also used to create in-game NFT’s. LAND can be monetized via renting or featuring pay to play experiences like “quests”, which can be created using the sandbox game maker. LAND and in-game NFT’s can be purchased and sold on the Sandbox’s own NFT marketplace and all NFT’s are priced in the SAND token.
SAND is an ERC-20 token, which is the Sandbox’s in-game currency. SAND and LAND give governance rights to their holders. SAND can be staked and earn players passive income. The Sandbox Alpha was released on Nov. 29th 2021 and closed on Dec 20th 2021, having had 18 total experiences.
In Oct. 2020 Socios purchased a rather large estate in the Sandbox to create a virtual platform for its community. For those unfamiliar with Socios, they created and deployed the Chiliz blockchain. Chiliz (CHZ) is a sports NFT focused crypto project featuring fan tokens.
In Jan. 2021, the Sandbox announced its first round of public LAND sales which happened in Feb. 2021 with CoinMarketCap as a sales partner.
In March 2021, the Sandbox announced that its Feb. 2021 LAND sales had broken NFT sale records, nearly raising $3 million USD. Towards the end of March the Sandbox released the public beta version of its NFT marketplace.
In June 2021, the Sandbox upgraded the VOX edit software to allow for the seamless creation of in-game NFT’s. Towards the end of June, the Sandbox announced a series of plans to reduce its carbon footprint by 99%. This included purchasing carbon credits, planting trees, and integration with Polygon ($MATIC).
In July 2021, the Sandbox announced a partnership with Skybound Entertainment. Skybound is the company you can thank for The Walking Dead / Fear the Walking Dead comics and TV shows and bringing zombies to the Metaverse. As a part of this partnership, the Walking Dead was given a large plot of LAND and the Sandbox later sold LAND NFT’s near the Walking Dead community primarily targeting fans and gamers alike.
In Aug. 2021, the Sandbox announced a partnership with Big Fan innovate to bring sports into the Sandbox.
In Sept. 2021 the Sandbox bought a Bored Ape NFT for 740 ETH (around $3 million USD). The Sandbox actually has a large collection of community owned NFT’s which total in value more than $14 million USD. Snoop Dogg also came to the Sandbox with his virtual mansion and sold 1000 passes to his private virtual party.
In Oct. 2021 Ubisoft announced that it was seeking to invest in and create blockchain games with a focus on Animoca Brands (which owns the Sandbox).
In Nov. 2021 the Sandbox announced that it had raised $93 million USD which was led by SoftBank (one of the largest investment companies in the world).
The Price Analysis
The Sandbox price increased significantly on Friday (Dec. 24th) as interest in NFT’s and Metaverse coins like Gala, Decentraland, and Enjin jumped. Sand is trading at $6.07, which is about 20% above the lowest level on Thursday. This spike brings the market cap to over $5.7 billion USD.
The 4 hour chart shows that the SAND price has been under pressure over the past few weeks. The price has crashed by more than 28% from its ATH. A closer look shows that the price has found a strong support level around $4.75. It struggled to move below this level several times this month.
However, recently the price has managed to rebound and rose to the highest level since Dec. 15th. It also moved above the 25-day and 50-day MA (Moving Averages) while the RSI (Relative Strength Index) has been rising. The coin has also moved above the descending trend line, rising above $6 USD. This means that the bullish trend will likely continue as bulls target the key resistance level at around $7. This price is about 15% above its current level. However, a drop below $5.50 will signal a possible bearish trend.
By providing an ecosystem for tokenized assets in gaming, the Sandbox ecosystem makes use of several different tokens. SAND is an ERC-20 token that powers all of the ecosystem’s transactions and interactions. For example, it costs SAND tokens to play games, purchase NFT’s, or customize your avatar. In the future, SAND will also serve as a governance token, allowing its holders to have input on changes to the ecosystem when the Sandbox DAO is established.
SAND can also be used to purchase NFT’s, ASSETS, and LANDS, which are digital pieces of real estate that are represented by ERC-721 tokens (the ERC standard for NFT’s). Players can use their LANDS in a 96x96 meter digital plot, to house games, ASSETS, and NFT’s. Only 166,464 plots of LAND will ever exist. When a player combines multiple parcels of LAND into one property, it’s called an Estate.
User generated digital ASSETS are represented as ERC-1155 tokens. To ensure the everlasting scarcity and verifiable scarcity of NFT items, they use the ERC-1155 token standard. This standard allows a smart contract to track token-ownership at the individual token level: each item has a unique identifier, and optionally, unique properties stored as metadata.
SAND tokens can be staked to earn passive income such as SAND, as well as GEMS and Catalysts. GEMS and Catalysts are two further types of tokens which are required for ASSET creation. Catalysts are ERC-20 tokens that define the “tier” and scarcity of ASSETS, which can range from “common” to “legendary”. Common ASSETS are the least scarce with legendary ASSETS being the scarcest. GEMS are ERC-20 tokens and are burned when used. Additionally to being passively earned through staking rewards, GEMS can be purchased from other players.
The Sandbox pays for Ethereum gas fees for users, making their experience more seamless. In addition, 50% of the SAND token transaction volume is allotted to the Sandbox Foundation, which supports the ecosystem by funding grants and promoting the Sandbox.
Progressing opening of the Metaverse to LAND owners who have built high-quality experiences
Launch of the DAO with staking and voting mechanisms for SAND, LAND, and AVATAR holders
The Sandbox DAO will allow to participate in major decisions on the Game Platform
Launch of the first virtual concerts (Deadmau5, Richie Hawtin) and The Walking Dead game
Mobile version launch
Other milestones in 2022 with a release TBD:
New IPs and Premium NFT’s to be announced
Over 1000 Games available
Availability of Game on consoles
LAND Public sale
Regular LAND sales will continue
Co-Building Mode –
Creating games with Friends, Custom Scripting with programming 3rd layer and major updates with more gaming packages and Behaviors
Additional Seasons with big rewards to earn
Major updates with more behavior to make creation of voxel assets and NFT’s easier
Concerns and Conclusions
My main concern can be summed up with a single word, Overload. The hype around the Sandbox going live has been building up for more than 3 years and has amassed a massive community that’s anxiously waiting to explore its Metaverse. Now that is great news but at the same time it does raise concerns of whether or not developers have sufficiently made the Sandbox website and its Polygon smart contracts ready to handle this potential massive influx of traffic.
Which brings me to my next concern, and that would be the centralization of architecture. Although the Sandbox does utilize both Ethereum and IPFS, the Sandbox whitepaper notes that the Sandbox Metaverse runs on a single server hosted on AWS. I’m sure you are all familiar with issues regarding AWS with some of you even experiencing issues here on Public with AWS outages. So it goes without saying that having a single point of failure is not a good thing.
Unlike the Sandbox, Decentraland uses a network of community-run servers to host its Metaverse. This is obviously better because it doesn’t have a single point of failure. The only down-side is that you sacrifice scalability. Decentraland can only host 100 people per server, although this is something that they are working on. However the Sandbox can handle several times that amount, this is due to its centralization of its Metaverse.
Another important note while on the subject of centralization is that the Sandbox Foundation maintains complete control of the project. Although this is how most cryptocurrency and crypto-based projects start. The problem with this, is that having that much control means that the Sandbox is unlikely to be listed on Coinbase in its current form. The reason for this is because Coinbase might view the Sandbox as a potential security and decide that it’s not worth the risk.
My last concern is the FATF or the Financial Taskforce and their crypto recommendations. This is because the FATF recommends that the Sandbox mandates KYC. These recommendations are supposed to take effect in June 2022, which if they do it might restrict the potential adoption and user base that would otherwise drive up the price of SAND.
Not financial advice.
DYOR. DCA. BTD. HODL.