The metaverse was anticipated to usher in a bright new future for humanity, led by none other than Mark Zuckerberg. According to researchers at Citi, it was expected to attract five billion users and escalate in value to $13 trillion. Unfortunately, it seems that expectations were set too high for this project, at least prematurely. The metaverse division of the former Facebook, now rebranded as Meta, lost $4.5 billion in the last offseason alone and has incurred losses totaling $46 billion since its inception. The flagship metaverse project, which was designed primarily for adults, became a hit among younger children.
As a result, it is not surprising that the crypto metaverse sector also exhibits the traits of a colossal bubble that is now bursting. This can be observed in the valuation of metaverse assets such as land, in-game currency, and characters. Take, for instance, The Sandbox, a metaverse that was once valued at over $7 billion. As of August 8, its transaction volume plummeted by 99.9%, from a peak of $117 million in 2022 to under $8,000, according to DappRadar.
Furthermore, the situation does not improve when examining the sales of The Sandbox NFTs. On November 24, 2021, $10.2 million worth of The Sandbox NFTs were still being traded. However, on average days in August this year, NFTs from the 2021 collections saw transactions of less than $10,000, representing a reduction of over 99.9%.
By all accounts, the metaverse has collapsed
For example, Decentraland, one of the oldest crypto metaverses, has experienced a 99.9% decline in its daily transaction volume, from $2.5 million on November 29, 2021, to under $5,000 on average this month. Other metaverse worlds have not performed any better. Axie Infinity’s trading volume has decreased by 99%, falling from nearly $1 billion on September 30, 2021, to less than $2 million today. Metaverse transactions diminished by 99%, dropping from 672 on April 6, 2022, to an average of less than five this month. League of Kingdoms transactions have fared slightly better, with a “mere” 90% drop compared to the peak on March 19, 2022. Almost every existing metric indicates that crypto metaverses have significantly waned in popularity, as seen in the number of active wallets, land resales, or the value of in-game assets.
Following the coin release model of MasterCoin and NextCoin in 2013, many crypto metaverses launched their own tokens that serve as both in-game currency and governance tokens. Nearly all of these metaverse tokens, along with user engagement statistics within the digital realms, have declined by at least 90% from their peak. A graph of various metaverse currencies indicates a decline of more than 90% from mid-November 2021 to now. Decentraland’s MANA, Axie Infinity’s AXS and SLP, The Sandbox’s SAND, Yield Guild Games’ YGG, Vulcan Forged’s PYR, Metahero’s HERO, GensoKishi Metaverse’s MV, DeFi Land’s DFL, and NFT World’s WRLD have all decreased over 90% in value since mid-November 2021.
Despite the two-year downturn, there are still believers in the metaverse, particularly billionaire Mark Zuckerberg. His personal fortune is ten times higher than the combined market capitalization of all metaverse tokens identified by CoinMarketCap. Nevertheless, Zuckerberg and his Meta Reality Labs division are almost fanatically committed to making the metaverse a reality. However, whether this will materialize in his lifetime remains uncertain.
https://www.youtube.com/watch?v=videoseries
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<p>The metaverse was supposed to usher in a new, bright future for humanity, spearheaded by none other than Mark Zuckerberg. <strong>According to researchers at Citi, the metaverse was projected to attract five billion users and reach a staggering value of $13 trillion.</strong> However, expectations appear to have exceeded reality, with the metaverse division of Meta (formerly Facebook) amassing a staggering loss of $4.5 billion in the last offseason alone. Over its short existence, the company has reported losses totaling $46 billion. Additionally, the flagship metaverse project was initially aimed at adults but has unexpectedly gained traction among younger audiences.</p>
<h2>The Crypto Metaverse Sector: A Crumbling Dream</h2>
<p>Consequently, the crypto metaverse sector exhibits signs reminiscent of a colossal bursting bubble. One prime example is The Sandbox, which once boasted a market valuation exceeding $7 billion. <strong>As of August 8, its transaction volume has plummeted by 99.9%, falling to below $8,000 from a peak of $117 million in 2022, per data from DappRadar.</strong></p>
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<p>Sales figures for The Sandbox NFTs further reinforce this downward trend. On November 24, 2021, the trading volume reached $10.2 million. However, during an average day in August this year, the same NFTs traded for less than $10,000—amounting to a staggering reduction of over 99.9%.</p>
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<h2>By All Measures, the Metaverse Has Collapsed</h2>
<p>Decentraland, one of the early forerunners in the crypto metaverse space, similarly suffers from a dismal decline in activity. Its daily transaction volume has dipped by 99.9%, from $2.5 million on November 29, 2021, to less than $5,000 this month. <strong>Other metaverse projects, such as Axie Infinity, have also shed a staggering 99% of their trading volume, falling from nearly $1 billion on September 30, 2021, to below $2 million today.</strong> The overall transactions in the metaverse have decreased by 99%, plummeting from 672 on April 6, 2022, to an average of less than five in the present month. League of Kingdoms remains an exception, with only a 90% decrease from its peak on March 19, 2022.</p>
<h3>Decline of Popularity Indicators</h3>
<p>Almost every available metric indicates a remarkable loss of interest in crypto metaverses, including:</p>
<ul>
<li>Average daily transactions</li>
<li>Active wallets</li>
<li>Resales of virtual land</li>
<li>Value of in-game assets (skins)</li>
</ul>
<h2>Token Price Declines: A Harsh Reality</h2>
<p>Many crypto metaverses adopted the coin release model pioneered by MasterCoin and NextCoin in 2013, issuing their own tokens that function as in-game currency and governance tokens. Unfortunately, prices for nearly all metaverse tokens have languished, with user engagement metrics plunging by at least 90% since their peak. The following table illustrates the decline in various metaverse currencies from mid-November 2021 to the present:</p>
<table class="wp-block-table">
<thead>
<tr>
<th>Metaverse Token</th>
<th>Peak Price (Nov 2021)</th>
<th>Current Price (Aug 2023)</th>
<th>Decline (%)</th>
</tr>
</thead>
<tbody>
<tr>
<td>Decentraland (MANA)</td>
<td>$5.80</td>
<td>$0.20</td>
<td>96.55%</td>
</tr>
<tr>
<td>Axie Infinity (AXS)</td>
<td>$164.90</td>
<td>$12.25</td>
<td>92.59%</td>
</tr>
<tr>
<td>The Sandbox (SAND)</td>
<td>$8.40</td>
<td>$0.45</td>
<td>94.64%</td>
</tr>
<tr>
<td>Vulcan Forged (PYR)</td>
<td>$48.20</td>
<td>$3.00</td>
<td>93.77%</td>
</tr>
</tbody>
</table>
<h2>The Future Outlook: Can the Metaverse Recover?</h2>
<p>Despite the bleak landscape of the metaverse, some devoted enthusiasts remain optimistic, including billionaire Mark Zuckerberg. Remarkably, his personal fortune is ten times greater than the cumulative market capitalization of all metaverse tokens tracked by CoinMarketCap. Zuckerberg and his Meta Reality Labs division are adamant about realizing the potential of the metaverse, though whether this ambitious goal can be achieved in his lifetime remains uncertain.</p>
<h3>Practical Tips for Engaging with the Metaverse</h3>
<p>If you're still interested in exploring the metaverse, consider the following tips:</p>
<ul>
<li>Stay informed: Follow reputable sources for updates on metaverse trends and news.</li>
<li>Participate cautiously: Engage in communities and platforms where you can learn without significant investment risk.</li>
<li>Explore diverse projects: Look for innovative metaverse projects that offer real utility and community engagement.</li>
<li>Be cautious of speculation: Avoid falling for hype and ensure your decisions are data-driven and reasonable.</li>
</ul>
<h3>Case Studies: Lessons from the Fall</h3>
<p>Several projects in the metaverse space offer valuable lessons about the pitfalls of over-ambition and speculative investments:</p>
<ul>
<li><strong>The Sandbox:</strong> An initial explosion of excitement was followed by a significant collapse—a lesson in the volatility of virtual asset valuations.</li>
<li><strong>Decentraland:</strong> Once touted as the future of virtual real estate, its plummeting sales figures illustrate the challenges of maintaining value in digital asset markets.</li>
<li><strong>Axie Infinity:</strong> Its model of play-to-earn collapsed under the weight of unsustainable economic incentives, demonstrating the necessity for sound economic models in digital spaces.</li>
</ul>
</div>https://www.youtube.com/watch?v=videoseries
