The Sandbox is an Ethereum token that, in my opinion, is on its way to zero. To me it's more decentralization, blockchain, Web3 theater built on top of a game, a virtual world, almost none of which is actually hosted on chain. I'm going to review it here because I'm tired of getting ripped off in these absolute garbage coins that are obviously, at least to me, not good investments. And I have to be honest with you: I bought and lost a little bit of money on this myself last year, which is exactly what motivated me to do better research. It's easy to get hyped up into buying something. But once you learn how to look, it's also easy to find what's wrong with a project and why you shouldn't buy it.
Down 25% While Almost Everything Else Doubled
The first thing I look at is the price chart. Over the last year, SAND has actually lost about 25%. Meanwhile Bitcoin is up about 100%. Ethereum is up around the same. The Internet Computer protocol is up around the same. But this token has managed to lose money over the last year. Why? Because, in my view, it's blockchain Web3 decentralization theater, all the way down.
If you look at what it claims to be, it says The Sandbox is a blockchain-based virtual world. All right, but how blockchain-based is it really? If you actually jump in, almost none of the real computation or assets are hosted on the blockchain. There are very tiny little amounts of computation. This is an ERC-20 token bridged over to some other platforms, and then almost all of the computation is done off chain. That means it's not really decentralized at all, because whoever is controlling all these assets on Amazon Web Services, or whichever centralized platform they've got it on, whoever has control of that account has control of all the stuff that actually makes it valuable.
The NFTs, the Land, and a House Built on Water
The NFTs and the land behind it are therefore incredibly speculative, and they give you no real ownership. There's a DAO, and the DAO is really just a polling mechanism. The developers and the team are not exactly transparent or accountable. You can see the founders, Arthur Madrid and Sebastien, but you might need to look up PixOwl if you want to find the actual team, because if you look directly under The Sandbox, this is a mobile game studio. To me, PixOwl looks like it might be the real owner of The Sandbox, which means the token is incredibly speculative. The token has no real legal ownership, and no ownership by code, over the actual assets. That, to me, does not look like a good investment.
If you go into The Sandbox documentation and look at the Sandbox Foundation, there's no transparency as to which people are even working on this right now, outside of the fact that this appears to be one of the games PixOwl developed, and they therefore own everything that's real. So what exactly is owned by the community? What people got hyped up about is that you can buy these plots of land and, in theory at least, you own them on the blockchain. These go through as Ethereum transactions unless they're bridged over to something else. You've got all these different brands that have supposedly bought up different parts of land, and you too can own, for just three Ethereum, a tiny little bit of a virtual world that isn't even actually on chain.
Here's how I'd describe it. If I sold you a house and told you the house is built on water, and then you came to the house after you bought it and saw that 99.9% of it is built on land, and there's a tiny 0.1%, less than a square foot, that's actually built on water, the image you had in your head versus the reality would be drastically different. That's what The Sandbox is to me. People imagine the whole thing is on chain, that by buying a piece of land the token makes it yours and nobody can take it away from you. But what you're really buying, as far as anyone can see, are assets that appear to be hosted on PixOwl's servers. You're essentially being tricked into thinking this is real Web3, but it's not.
Why You Pay in Ethereum, Not in SAND
Here's another critical problem. You'll notice a plot costs three Ethereum. My thought when I researched this was: why would I be paying Ethereum when there's a token built around this land? Why would I be buying these plots in Ethereum on the marketplace when there's a SAND token? Well, because nobody selling these plots, or hardly anybody, is interested in getting paid in SAND tokens. They want something more reliable and stable, like Ethereum. You technically have the choice of what to sell in, but almost everybody sells the actual land in Ethereum, and increasingly in USDC. And it's like, seriously?
So there's no transparency from the Sandbox Foundation, the real assets appear to all be owned by PixOwl, and the SAND token itself isn't even generally used to transact the land. If you created your own version of this, who would come after you legally? Probably PixOwl. So why would you even want to hold the token?
The DAO Is Just a Poll, and You Might Have to Pay to Vote
Well, do you think being able to vote in a poll is valuable? Because if you do, they have the Sandbox DAO. According to the Sandbox DAO website, you can shape the future of the platform, join the discussion, and vote. Now, I haven't voted myself, but I'm going to guess that since this is on the Ethereum blockchain, or over on Polygon if they do it there, wherever you vote you're going to have to pay to vote if it's actually on chain. And that would really change elections in the world, wouldn't it? How many people would just stay home, like, I'm not going to pay to vote. Even if it was 20 dollars, people would say I'm not paying 20 dollars to vote, I don't care that much. So I imagine you have to pay to vote here.
And the worst part is that whether it's on Ethereum or bridged to Polygon, your votes are essentially meaningless, because the actual way the code gets changed, or the tokens get allocated or adjusted, is in almost every case just a polling mechanism. Whoever the real controllers of The Sandbox are, the foundation or the company, PixOwl, somebody has to actually go in and make those changes. The blockchain doesn't make them itself. It just tells the developers what changes people would like. We've seen this before with things like Arbitrum, where one of the first DAO votes went one way and the people with real control literally did the exact opposite of what the DAO voted. Then they came out with a response like, well, we were just asking your opinion. To me that's obviously just decentralization DAO theater. There's no real DAO there, because the technology itself isn't set up to actually execute and do what you think it should do. The proposals here are only released every two weeks, so it's not exactly upgrading fast, and you have to have a minimum of five SAND or one LAND to even be able to vote.
What a Real DAO Looks Like to Me
On the Internet Computer, the technology is absolutely set up to do exactly what you think it can do. On the Internet Computer you have real DAOs. When you launch an SNS coin and you vote on these DAOs, your vote is executed by code. So when you vote on something, the code executes: it sends the tokens, it can remove canisters. Some of these tokens have had people get more than 50% of the voting power, totally take control of the token, change the name, rebrand it, and change the supply. That, to me, is a real DAO. The Sandbox, in my opinion, which is exactly what we're here for, is not a real DAO. A real DAO should have legal or physical ownership over the asset it claims to be giving you voting power over. If The Sandbox ever moved their actual hosting and their ERC-20 token onto the Internet Computer, I might change my opinion on it going to zero. It would be difficult to do right now, because they've already built all the backend, the website, and the hosting off chain, so it would take a significant effort to put all that on chain. But the fact is it's now possible to build all of this on chain.
So as an investor, I'm not tolerating this anymore, where it's fake Web3 made to look like real Web3, when technologically it's essentially Web2 with a token bolted on. This is the same reason I'll never invest in crypto gaming coins, and why I came to the same conclusion reviewing tokens like Enjin Coin. If you want to follow my honest reviews of these coins, I keep them all going in my Money playlist.
The 3,000 Dollar Giveaway and the Gas Fee Trap
Then I look at their X account, and they're giving away 10,000 SAND, a hundred SAND, 30 dollars to a hundred players, 3,000 dollars. Wow, that's amazing. Really making it rain in here with this 3,000 dollar giveaway. I could do a 3,000 dollar giveaway on the Internet Computer right now. And those tokens are going to cost you ETH gas fees. If you get this in your wallet, you're stuck paying ETH gas fees, and as the price of ETH pumps, you could get stuck not even being able to sell your giveaway.
This is the problem with these tokens. People don't realize that if you bought, say, 30 dollars of this, a hundred SAND tokens, then on some exchanges you'd have to pay 20 dollars to take it off the exchange and put it in your wallet. So you're stuck holding it on an exchange, and because it's on an exchange, the price is easy to manipulate.
Who Actually Holds SAND
If you look at the holders, there's massive concentration. This is not decentralized at all. The top 500 wallets have about 95%, but the top 100 have 90%, so why even bother with the other 400? This token has been out for years. According to the chart, it's been out on Ethereum since 2020. And when you read further, they talk about PixOwl being around since 2011, which appears to be the real owner, but you're not investing in PixOwl by holding the SAND token.
So the token's been out since 2020, and the top 100 holders still have 90%. The Genesis address still has 10%. One top address that isn't labeled has 18%. A multisig has another 8%. Then roughly 8% of it is bridged onto Polygon. And how many times do we need to see bridges hacked and rip people off before we stop accepting and trusting them? That's a point of vulnerability where everything could go to zero. You've also got huge amounts of the token sitting on Binance right now that could be dumped at any time, or manipulated up. Whoever's holding it there doesn't really have real ownership. It's not your coin or your crypto for real if it's on an exchange. A lot of people have just bought these on an exchange wallet and are sitting there with it, although at least that way you could dump it without paying any fees.
You'll see a ton of wallets here that hold a lot of supply, a bunch of different exchange wallets, for people who in most cases have never played the game and never bought land.
You Don't Even Need the Token to Play
I was actually thinking about playing the game myself, but you don't even need the token to play. And when you're playing, you're not even doing anything on the Ethereum blockchain or on Polygon. So why do we even need a token? We need a token to raise money and to get people to think there's something special here, when really this looks relatively easy to spin up technically. You take some of the Unreal Engine code, throw some things together, have a few developers build the blockchain stuff in, and that's it. If this game wasn't hyped up as blockchain, it would be an absolute nothing burger. That's the whole reason these games put a token out, to trick people into investing in them.
I'm a gamer, and to me this is a sucky-looking game. It doesn't even look good enough for me to want to play it. If you've seen how things like this do over time, just as games, they tend to do very poorly. If you look at the token transfers chart, it isn't going well either. At the peak of the bull market hype you had a few thousand transactions a day, and overall the activity has gone down, especially recently, down to a few hundred total transfers a day. That includes every possible thing you could do with the token. That's just on Ethereum, and there can be additional usage on other chains, but to me this looks like a nothing burger, easily going to zero, with a ton of hype. It looks like they paid a bunch of people, like Snoop Dogg, to show it and hype it up and get people interested.
Why I Dumped My SAND
Even I got tricked into buying the token. But I realized that if I'm holding a token for The Sandbox game and I haven't played The Sandbox game, then I either need to play the game or dump the token. So I decided to dump the token, because this game sucks and I wouldn't even bother playing it.
When you compare something like The Sandbox, with a few hundred thousand holders and a market cap of nearly a billion dollars, to something like the Internet Computer, which I believe has the absolute best technology in crypto, the difference is night and day. There's no transparency about the team behind The Sandbox, and no real ownership, unless it's just PixOwl, in which case it's not decentralized or community-owned at all. On the Internet Computer, the major contributor, DFINITY, runs the largest research and development team in blockchain, a massive amount of technical talent, engineers, PhDs, and computer scientists. My own website is hosted on the Internet Computer protocol.
You could actually build The Sandbox fully on chain, and if it was fully on chain and controlled by an SNS DAO, then it could genuinely be owned and controlled by the community, by code. But the way The Sandbox is set up, it's not fully owned and controlled by the community. It has tokens on a blockchain, and those tokens are powerless to actually control the real assets, which would be the in-game world, the foundation of all the value. This is the same trap I keep running into across these coins, and it's why I'm comfortable saying I'd never hold something like the Loopring ERC-20 token for the same reasons. I dig into all of this honestly inside the Jerry Banfield Family, where you all asked me to review this in the first place, so I did.