Entropia Universe

On 12 December, 2004, a full virtual island of 6000 acres was sold. Through an in-game auction, players were able to bid on their own island. The ownership gives many privileges, such as a unique castle, taxation rights and income from the sale of land lots. The final bid was 265 000 PED (26 500 USD, in-game money can be bought with a credit card).

This looks like a crazy investment for virtual property, but by selling land, there is massive revenue potential, as PED can be exchanged for USD as well. Unless of course they pull the plug on the servers next month :)