The rebranding of Facebook into Meta Platforms (NASDAQ:FB) has generated significant interest in the metaverse, offering a new investment theme for Wall Street. The metaverse is an immersive, third-dimensional platform with a multitude of experiences that include games, social networks and shopping. In turn, the growing investor attention has recently fueled a rally in meta coins, or cryptocurrencies associated with metaverse projects.
Recent research highlights: “In the Metaverse, a virtual world that transcends reality, artificial intelligence and blockchain technology are being combined…. Data generated in the metaverse has value in itself. In the Metaverse, the amount of data increases, the value increases, and the importance of reliability and security is increasing. Blockchain technology is required to guarantee the reliability of data in the Metaverse, and artificial intelligence is used to secure the diversity and rich content of the Metaverse.”
Put another way, blockchain and crypto assets embody key technologies expected to help the metaverse reach its full potential. For instance, a secure, transparent and traceable payment method constitutes a crucial tailwind that is expected to shape the transformation of the metaverse.
Moreover, in recent weeks, meta coins such as The Sandbox (CCC:SAND-USD), Axie Infinity (CCC:AXS-USD) and Decentraland (CCC:MANA-USD) have significantly outperformed traditional metaverse stocks like Roblox (NYSE:RBLX) or Electronic Arts (NASDAQ:EA). With that in mind, many investors expect multiple meta coins to benefit from this trend well into the new year.
Meanwhile, gaming startups are raising significant cash from prominent venture capital firms. For example, Solana Ventures (CCC:SOL-USD) and FTX joined forces with Lightspeed Venture Partners to invest $100 million in companies focused on developing a gaming metaverse. On the other hand, Andreessen Horowitz led a $150 million financing for Mythical Games — reflecting Mythical’s success in introducing play-to-earn concepts and playable non-fungible tokens (NFTs) to the mainstream.
So, as the cyberspace evolves, we’re likely to hear more about stocks and cryptos that will take the centerstage in the growth of the metaverse. And with that information, here are three meta coins that are poised to gain traction in 2022:
- Axie Infinity
- Somnium Space (CCC:CUBE-USD)
Now, let’s dive in and take a closer look at each one.
Meta Coins: Axie Infinity (AXS-USD)
52-Week Range: $0.3191 – $165.37
Market Cap: $8.2 billion
Founded by the Vietnam-based Sky Mavis in 2018, Axie Infinity is a NFT-based crypto game. Players breed and trade Pokémon-inspired NFT pets called Axies. The game also allows users to purchase plots of land and live in virtual towns. Such a play-to-earn model is an attractive selling point, as it allows users to redeem earnings in-game and exchange for assets outside the game to generate real-life passive income.
The digital ecosystem is powered by two native cryptocurrencies. While AXS-USD can be traded on several crypto exchanges, Smooth Love Potion (CCC:SLP-USD) is awarded to players for spending time in the game. Its $8.2 billion market capitalization makes AXS-USD the top metaverse coin by that measure.
Axie Infinity is developed on the Ronin Sidechain, an Ethereum (CCC:ETH-USD)-based sidechain. In September, the platform boasted around 1 million daily players and generated $220 million in protocol revenue, the second-largest revenue-generating project only behind Ethereum.
AXS-USD hit an all-time-high (ATH) of $165.37 earlier this month. The metaverse coin has gained more than 26,000% year-to-date (YTD). It currently trades around $135, down 18% from its peak value.
Meta Coins: Decentraland (MANA-USD)
52-Week Range: $0.07033 – $4.69
Market Cap: $5.8 billion
Founded in 2017, Decentraland is an early blockchain project to create a decentralized virtual reality platform on the Ethereum blockchain. The blockchain allows players to purchase parcels of “LAND,” and create their own environments, marketplaces and applications.
MANA-USD is the fungible token players use to purchase LAND, services and goods in the digital ecosystem. There are 2.2 billion tokens in supply, and 1.3 billion are in circulation. Decentraland is entirely owned and governed by users through a decentralized autonomous organization.
Players can play, explore, display art in NFT art galleries or try on NFT wearables. Decentraland recently held a Metaverse Festival, where players were invited to listen to live music, enjoying a variety of artist performances during the event.
MANA-USD currently trades around $3.20, up almost 4,000% YTD. It has surged 300% during the past month. It is currently hovering roughly around 20% below its all-time high price in late October.
Meta Coins: Somnium Space (CUBE-USD)
52-Week Range: $1.74– $28.28
Market Cap: $200 million
Somnium Space is an open-source virtual reality (VR) platform. Users can build or buy digital land, homes, buildings and other digital assets. They can also develop their own scenes on their virtual properties, and deploy full-body avatars as well. Moreover, Somnium’s WebXR platform allows them to access their parcel from any device with a web browser.
Furthermore, the platform was developed using the Polygon blockchain to eliminate entry barriers for users worldwide. Somnium has attracted significant attention in the NFT industry due to its ability to integrate NFTs in the metaverse. NFT collections offer players a unique 3D experience with their avatars.
As software development kit (SDK), the platform utilizes Unity Software (NYSE:U). They can upload full-body Avatars and complete scenes onto their land parcels. The platform also boasts full-body tracking, which is the “ability to imitate your real body movement into an avatar.” Additionally, the “most common way to achieve tracking is by attaching to the body special markers that are detected by cameras.
Collectively, CUBE-USD is the token that fuels this digital ecosystem, allowing for smooth transfers of assets within the metaverse. It hit an all-time high of $28.28 in early November. And overall, this metaverse coin has gained more than 500% over the past month. Nonetheless, it currently trades at just more than half its peak value at $15.63.
On the date of publication, Tezcan Gecgil did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Tezcan Gecgil, Ph.D., has worked in investment management for over two decades in the U.S. and U.K. In addition to formal higher education in the field, she has also completed all three levels of the Chartered Market Technician (CMT) examination. Her passion is for options trading based on technical analysis of fundamentally strong companies. She especially enjoys setting up weekly covered calls for income generation.