While Meta’s shares experienced a record slide this week, the token prices of its competing metaverses have been on the rise, posing a question – can the Web2 company hold back against the oncoming storm of Web3?
February didn’t start off on the right foot for Meta as it set a new anti-record. Facebook’s parent company saw the largest single-day drop in US market history on Thursday, February 3, when its share prices plunged by 26%. This transpired after the company revealed less-than-stellar earnings and decreased daily activity.
In October 2021, Facebook Inc announced that it was changing its name to Meta Platforms, signaling a shift in the company’s trajectory towards developing the Metaverse – a virtual social environment.
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe - We publish new crypto explainer videos every week!
What is Olympus DAO? (OHM Crypto Animated Explainer)
Despite this, Meta has not been the leading name in the conversation, with its blockchain-based competitors The Sandbox and Decentraland seeing significant gains.
Based on data provided by Meta, in Q4 2021, the company’s total revenue was worth $33.67 billion, compared to $28 billion in the same quarter in 2020. Notably, the net income decreased to $10,28, compared to $11.2 billion the previous year.
This was the first time Meta’s earnings report featured a separate segment for Reality Labs, the company’s virtual (VR) and augmented reality (AR) R&D division.
While the initial numbers weren’t too optimistic, with the company’s losses going from $6.6 billion in 2020 to $10 billion a year later, it may still see a U-turn. The R&D department is still working on technological advancements for the Metaverse, like the haptic globe, which will allow users to touch objects inside the virtual world.
Yat Siu, chairman and co-founder of Animoca Brands, commented on Facebook’s market situation in an interview with a news outlet, stating that the shares performance may reflect a trend towards users straying further away from the centralized Web2 model.
Siu described Web2 as “a system that does not share any meaningful part of the ownership or value of the network,” saying that the users would eventually wind up seeking out better alternatives and abandoning the current model.
According to Siu, it’s likely that some of the biggest Web2 brands, like Meta or Apple, could end up losing some of their best people to Web3, particularly metaverse-based projects, as they start looking for decentralized opportunities that allow them to hold ownership of their work, rather than it being swallowed up by a corporation.
Animoca Brands is the company behind The Sandbox, a blockchain-based virtual game and one of Meta’s biggest competitors in the metaverse area. Alongside Decentraland, it’s one of the biggest competitors in the metaverse market today. Both The Sandbox and Decentraland are Ethereum-based.
The past week has been favorable for both Meta’s rivals. Decentraland’s token MANA has seen its price go up by more than 20% in the past week, climbing up to $2.60. SAND, The Sandbox’s token, has also been on the up and up with a 17.5% growth. The price surged to $4 at its peak and is currently balancing at around $3.60.
It wasn’t just Meta’s market performance that gave MANA and SAND a boost this week.
The Sandbox has been keeping busy. It announced a partnership with the decentralized autonomous organization (DAO) UniX Gaming. On top of that, the platform is also working on collaborations with Coincheck and WMG – Oasis LAND and Warner Music Group LAND, respectively. The metaverse is set to expand on February 10, with more new land available.
Meanwhile, Decentraland published its Manifesto for 2022, which listed a prototype mobile app, game experience improvements, more NFT utilization opportunities, and protocol enhancements as some of the key projects.
The Sandbox team announced a partnership with UniX Gaming, a decentralized autonomous organization (DAO), and a release of more “land” in its metaverse slated for February 10.
Recently, some unconfirmed rumors surfaced, alleging that Meta was looking into acquiring The Sandbox. Sebastien Borget, Co-Founder and COO of The Sandbox, as well as Siu both denied these rumors.
Interest in the metaverse is ever-growing, with companies like Apple, Microsoft, and Disney starting to look into opportunities offered by Web3. Although Meta is hoping to be a big player in the field, it may not win the race quite yet.
