The majority of NFT and Metaverse tokens started off on a very high bullish note as users were amazed at the way each of the protocols’ sought to drive the mainstream adoption of NFTs and gaming at launch.
Today is not one of the best days for metaverse and Non-Fungible Tokens (NFT) related digital tokens as most are trading in the red. While ApeCoin (APE) is down 6.46% to $7.58, Decentraland (MANA) dropped 9.18% to $1.03, Axie Infinity (AXS) saw a further reduction in its price by another 8.55% to $21.03 and The Sandbox (SAND) plunged by 9.45% to $1.29 according to data from CoinMarketCap.
The bearish outlook that is engulfing the NFT and metaverse tokens is all a reflection of general negative sentiment in the broader crypto ecosystem. Led by Bitcoin (BTC) is down 3.89% to $29,354.64, and the combined crypto market capitalization is down 3.85% to $1.26 trillion.
The difference between Bitcoin and a few Layer-1 blockchain tokens when compared with NFT and metaverse coins is that the latter brandishes a unique set of utilities that will continually drive their demand. At this time the coins outlook and subsequent price valuation are slashed because there is a significant decline in demand across the board.
Inward Look into NFT and Metaverse Tokens
The majority of NFT and Metaverse tokens started off on a very high bullish note as users were amazed at the way each of the protocols’ sought to drive the mainstream adoption of NFTs and gaming at launch.
The Sandbox for instance is a virtual real estate world where users tend to buy plots of land as NFTs. While a number of major multinational brands including HSBC have landed on the Sandbox metaverse, the platform is having a great deal of challenge retaining customers or its landed NFT holders.
Data shows that land sales on the Sandbox are down by 54% in Q1 2022 compared to Q4 2021. Data from Messari shows that the platform has only a 7% retention rate, that is, landowners who are still in possession of their assets after a year of purchase. Approximately 10% sell-off their Sandbox properties after a month of purchase with just 72% claiming ownership after the first 3 months.
Axie Infinity’s woes are characterized or influenced by many factors beyond the general market slump. The hack of the platform’s Ronin Bridge has had a very massive negative toll on the startup this past few weeks and the revenue generated from the utilization of the gaming platform has dropped immensely.
According to data from Nansen, Axie Infinity now records just $5,500 in daily revenue from breeding and marketplace fees, down 99% from all-time highs of $17.5 million per day recorded in August 2021. These inconsistent engagements with the ideals of the NFT and metaverse tokens have remained a dominant cause of recent price plunges, and unless the sentiments are changed across the board, this may continually drain out the reserve and valuation of these tokens.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
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