- The Ethereum-backed metaverse projects have plunged over 85% this year.
- On a weekly average, the volumes dipped from a high of US$1 billion in November 2021 to about US$157 million as of August 2022.
When the metaverse boom happened, much like the non-fungible tokens, leading brands were queueing up to grab a piece and be a part of this emerging technology. For many who are still figuring out what the fuzz is all about, the Metaverse, in its simplest form, is a gateway for creating virtual settings that are similar to real life.
Metaverse has caught up, especially in the crypto space, mainly to its appeal, which can be found through games, art, real estate etc. Especially the real estate metaverse market has boomed ever since The Sandbox, Decentraland has witnessed tremendous volumes growth and some big-ticket buying.
Many believe the metaverse real estate market alone could become US$5 billion by 2026. As it stands, the overall metaverse market cap stands at US$14,689,085,176, with a trading volume of US$1,924,227,702, according to CoinMarketCap. But while, the momentum, which seemed no stopping, is showing signs of slowing down.
According to a survey done by WeMeta, the metaverse real estate market is facing its very own crisis moment on the back of declining volumes and a bear market, which has gripped the crypto market. In fact, leading metaverse real estate tokens such as Axie Infinity, Decentraland, The Sandbox have been down by 1.62%, 2.41% and 2.70% in the past 24 hours.
Significantly the Ethereum-backed metaverse projects have plunged over 85% this year. One of the reasons for such a drastic fall may be due to the poor land and sale volumes. Another reason could also be the bear market which had gripped the market, resulting in most cryptos witnessing a poor run. Such has been the fall that, on a weekly average, the volume dipped from a high of US$1 billion in November 2021 to about US$157 million as of August 2022.
Amid the waning market interest, let's look at 3 leading metaverse real estate projects and how they have performed of late.
Built on the Ethereum blockchain, Decentraland (MANA) is a virtual world which allows users to create content and monetize it. Every plot in Decentraland has a unique NFT signature. Through its designated marketplace, users can buy, sell or rent land on its platform. Each piece of land has a unique value, and the users can expand the value of the land by connecting nearby plots of land.
The MANA crypto on 10 August was trading at US$1.02 with a 24-hour trading volume of US$20,27,97,023, according to CoinMarketCap.
The Sandbox (SAND)
The Sandbox metaverse boasts of approximately 166,464 land plots. By combining DAO and the NFTs, the SAND crypto creates great powers of decentralized autonomous organizations (DAO) and non-fungible tokens (NFTs), the Sandbox acts as a 3D metaverse game, which allows the users to explore, buy land on and create structures, which can be used for monetization purpose as well. The players wholly own these items collected in the Sandbox game.
The SAND crypto on 10 August was trading at US$1.02 with a 24-hour trading volume of $24,27,62,850, according to CoinMarketCap.
Axie Infinity (AXS)
Another popular metaverse token is another blockchain-based game which allows users to buy NFTs comprising of monsters and then pit them against each other in battles. Powered by the Ethereum blockchain, AXS, unlike conventional games, the NFT confers ownership on the buyer.
The users of the AXS token can buy lands and maximize their investments by monetizing them. Each piece of land comes with gameplay that users can use by earning through Play-2-Earn. It also offers passive income for both the gamers and those who purchase lands through staking and farming of the token.
The AXS crypto on 10 August was trading at US$17.63 with a 24-hour trading volume of US$12,54,81,525, according to CoinMarketCap.
While Metaverse's real estate segment may have witnessed a slowdown, there is no sign of a slowdown in the overall segment. With it still poised to become a multi-billion dollar industry, this slowdown may be seen as a blip.
Having said that, in the crypto space, nothing can be taken for granted as things can change pretty quickly, and therefore one has to be extra cautious to ensure one doesn't make a wrong decision due to a lack of knowledge of the market or lack of research.