Can The Sandbox (SAND) Reach $1000?

Decentraland was my first encounter with “the metaverse”, but Sandbox has hijacked much of my excitement about this crazy sector of the crypto market. In this article, I’m looking into the possibility of The Sandbox (SAND) reaching $1000:

Yes, The Sandbox can reach $1000. This would put its market capitalization at $800 Billion, which is realistic because of the unprecedented potential of value-creation in the metaverse.

The main obstacle and reason why The Sandbox might struggle to reach 1000 dollars is that it has a huge supply:

Currently, there are 800 million tokens in circulation, which logically makes the price low. The max supply is 3 billion coins, which means that only 1/3 of the existing coins are in circulation at the moment. (source)

Remember: Price = Market Cap / Circulating Supply.

If the circulating supply is high, the price must be low. However, with a large enough market cap, The Sandbox can reach $1000.

“Just how big does the market cap have to be?”

We can calculate that by manipulating the equation above like this:

Price * Circulating Supply = Market Cap

$1000 * 800 000 000 = $170 000 000 000 = 800 Billion USD

In other words:

For The Sandbox to reach $1000, the market cap has to reach $800 Billion.

To give some perspective, the image below shows the market cap of a hypothetical Sandbox at $1000 side by side with the expected peak Bitcoin and Ethereum prices for this crypto cycle:
(Bitcoin will hit $100K and Ethereum will hit $8K)

Can sandbox reach 1000?
Comparison of market caps

If The Sandbox at $1000 had a market cap bigger than Bitcoin or Ethereum, I would deem it unrealistic.

As we can see on the image above, SAND at $1000 is highly realistic, but it’s too close to ETH to take place in 2022 or 2023 in my opinion.

This tells me that for The Sandbox to reach $1000, we need Ethereum and Bitcoin to grow beyond $100K and $8K respectively, which might happen this cycle, but more likely next cycle (2025-2028).

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Let’s get into the what, and the how, and analyze it deeper:

The Adoption of The Sanbox Might Take it to $1000:

Adoption is what drives the value of the SAND token. More adoption makes the coin go up in price, basically.

Thankfully, the adoption of The Sandbox is ramping up!

The Sandbox lags behind the leading decentralized metaverse “Decentraland” on users, but The Sandbox is growing FAST! They have a total of 500,000 users as of Q4 2021, while the number for Decentraland is estimated to be in the millions. (source, source.2)

Another interesting thing to compare is the volume of trading on Opensea (the leading NFT marketplace):

  • The Sandbox has a lifetime volume of 143,621 ETH.
  • Decentraland has a lifetime volume of 342,715 ETH

In other words, Decentraland NFT’s have been traded roughly three times more than that of The Sandbox. However, we need to keep in mind that Decentraland has been up and running much longer than The Sandbox.

Also, the gap between them was MUCH bigger 6 months ago. The Sandbox might be smaller than Decentraland, but in terms of growth, I think it’s doing better.

Below you’ll find some of the partnerships The Sandbox has landed:

the sandbox partners
source: https://www.sandbox.game/en/

In addition, they have hosted some pretty cool events, like a concert with Deadmau5 and Snoop Dogg. (source)

In the future, we will need to see continued growth in terms of monthly active users and partnerships with both big and small artists, businesses, and other organizations. Only with huge growth in these two aspects can The Sandbox ever reach $1000.

How Can The Sandbox Reach $100?

The potential value of this coin is insanely high. We’re talking trillions of dollars.

If The Sandbox manages to capture all its potential, the price would probably be in the multiple thousands of dollars. But I’m getting ahead of myself…

Think about it:

The Sandbox is recreating the world in a digital format. It created value from real estate, art, music, games, gambling, collectibles, parties/festivals, in-game businesses, marketplaces, and the list goes on…

We’ve got respected macro experts like Raoul Pal saying that “the metaverse”, which The Sandbox is making, might double the global GDP.

His reasoning goes (basically) like this:

If we copy the world into a digital format, we could potentially create the same amount of value in the metaverse as in the “real” world, and as a consequence, double the global GDP

“What exactly does “double the global GDP” mean for The Sandbox?”

Well, the current global GDP is estimated to be roughly 85 Trillion USD. To simplify this a lot, we can think of the global GDP as the world’s market cap.

If The Sandbox gets a 100% market share, which it won’t, and its market cap reaches $85 Trillion, the price could in theory reach:

$85 Trillion / 3,000,000,000 SAND (max supply) = $28,333 per SAND

If The Sandbox gets a 20% market share of the metaverse and reaches a market cap of 0.2 * $85 Trillion = $17 Trillion the price would be:

$17 Trillion / 3,000,000,000 = $5,666

Even if it only captures 1% of it, the price would be:

$0.85 Trillion / 3,000,000,000 = $283

All those calculations were with the max supply. If we use the current circulating supply we can multiply the prices by 3x…

This gives us a SAND price of $1063.

In other words:

For The Sandbox to reach $1000, it needs to reach a market cap equivalent to almost 1% of global GDP. This is not unrealistic as the nature of this project has the potential to double global GDP (or more). Therefore, The Sandbox can reach $1000.

Nevertheless, we see the beginnings of this value explosion already. There have been huge concerts, parties, art gallery openings, other social events, and much more. The real estate part and the advertising from businesses in The Sandbox and other projects like Decentraland metaverses are also taking off as I’m writing this.

Conclusion: Yes, The Sandbox Can Reach $1000

The Sandbox can definitely reach $1000 if it manages to capture a part of the value creation of the metaverse.

If Raoul Pal is right, and the metaverse actually manages to double the global GDP, The Sandbox can blow through $1000 like a hot knife through butter. It needs only capture one percent of the value in the SAND token, given today’s circulating supply. With the max supply, it needs roughly 3%.

Oh, and please remember:

This article is NOT a price prediction type of article. All of this is purely hypothetical and should be considered as a thought experiment. I hope you found it interesting and illuminating.

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