Facebook (Meta) hit a snag in its quest to explore opportunities in the metaverse space, which might explain why most metaverse tokens’ prices declined sharply over the week.
Various Reasons For Metaverse Tokens’ Price Decline
One other factor responsible for these price declines was the weakness in the wider crypto market. MANA, SAND, AXS, and APE are among the top metaverse tokens that posted double-digit losses. AXS price declined the most, losing 26% of its value following a $600m hack earlier in the week.
Many industry analysts agree that Meta’s delay in executing its plans to explore the metaverse space slowed down the level of cash investments into the metaverse sector. Also, some investors have started taking profits following a bullish run by these tokens late last month. The analysts also believed that the decline in the wider crypto market is also responsible for the token price declines.
Meta’s Struggle With Its Metaverse Plans
Meta’s plans to create a virtual space hit an obstacle on April 7. Meta had to temporarily suspend its plans for the metaverse space following US regulators’ ruling that the company must get majority backing from its shareholders before executing any of its metaverse plans.
Hence, Meta would need the approval of its shareholders via votes regarding its metaverse plans. Last December, Meta’s shareholders claimed that they needed to vote over possible denial of psychological and human rights that might happen on the platform. The shareholders proposed that a neutral party must scrutinize Meta’s metaverse plans over possible political or health risks.
The investors supporting this proposal opined that this proposal is necessary because of Facebook’s history of not censoring politically divisive content. Despite the company’s plan to boycott the proposal and move ahead with its plans, the regulator’s ruling would now force Meta to hold a vote about it during its next annual general meeting scheduled for next month. Through this vote, investors would determine whether Meta’s metaverse plans are “sensible and suitable” or “foolish.”
More Firms Seeking To Explore The Metaverse Space
Even though Meta may be experiencing problems in its metaverse plans, many other companies are not having such problems. Top Singapore-based financial institution (the DBS group) has announced that they will start offering their lending services in the metaverse soon.
Also, Mastercard’s latest intellectual property filings include metaverse-related trademarks. One of Mastercard’s competitors in the payment processing space, American express, had made a similar filing in its filing last month’s filing. This positive news was some of the reasons for the rise in the prices of metaverse tokens late last month.
Many businesses continue to explore the metaverse space with some level of creativity. One such creativity is JPMorgan’s virtual real estate purchase, making it possible for anyone to own a bank account in the metaverse space. Also, pharmaceutical behemoth, Pfizer, announced a blue badge tick on the avatar of its vaccinated gamers.