According to Meta’s financial report for the last quarter of 2021 released on Wednesday, the loss was a result of a decrease in Facebook’s daily active users (DAU) for the first time, which was met with a swift reaction from the market.
Meta, the parent company of social media giant, Facebook, has announced a loss of $10 billion in its augmented and virtual reality division, taking metaverse related tokens AXS and SAND along for the ride.
Meta, lost more than 26% during yesterday’s trading session as Facebook’s stock saw losses of over 22% during the after-hours trading session. The company’s stock lost a total of 26.39% throughout the past 24 hours, which saw over $200 billion off its market capitalization.
According to Meta’s financial report for the last quarter of 2021 released on Wednesday, the loss was a result of a decrease in Facebook’s daily active users (DAU) for the first time, which was met with a swift reaction from the market.
Meta’s losses went up from the $6.6 billion it recorded in 2020. Market experts however believe that the company is still in the early stages of laying the blueprints for the Metaverse technology, including the development of a haptic glove, which will allow users to “touch” objects in the metaverse.
Axie Infinity (AXS), The Sandbox (SAND), and Gala (GALA), and other metaverse related tokens, saw their price embark on a downward spiral, falling as much as 125 in the last 24 hours, following a downward trend that began on Wednesday night.
AXS’s price fell to under $46 in the early Asian hours on February 3, before slightly climbing up to $49 in afternoon hours. AXS saw its price trade over $53 before Meta published its earnings on Wednesday. The token, at press time, was trading at $48.65, down from the $93 price a month ago, and is now relying on support levels last seen in September 2021, before the token started its impressive run to all-time highs of $162 in November.
As rumors and speculations began to Swirl, analysts with crypto research firm Delphi Digital, attribute the fall of the token’s price to the falling user activity on Axie Infinity, partly in connection with the game’s native Smooth Love Potion (SLP) tokens.
“As SLP prices dip, players suffer as they cannot earn as much when compared to a few months back,” Delphi analysts stated in a note. “At its peak, a player could have earned $35 per day on July 21 vs $1 today at current prices (assuming 100 SLP/day). This has led many players to stop playing as the income has been reduced massively,” they added.
SAND recorded losses of 50 cents after Meta’s earnings release, further plummeting to as much as 10% in 24 hours on Thursday. The token which was up 7.5% a week ago, at press time was trading at $3.42, a figure shy of the $5.49 mark it reached just a month ago.
GALA also dropped from $0.20 to $0.18 within that same period before both tokens slightly recovered in Asian morning hours on Friday, as the crypto market as a whole saw some green.
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