AI-powered investment insights

About: Investoom Weekly is the newsletter by the market intelligence company Investoom that provides AI-powered investment insights through social sentiment data, onchain data and financial data. Investoom democratizes the access to hedge fund insights.

Overview of the topics

• Crypto Highlights: Tokens such as Decentraland have emerged as top performers, with gains of up to 152% in January.
• Social Data: During the past week, investors have typed 90 times per day the words “Metaverse+blockchain”.
• Financial Data: Roblox, DressX, and Emperia saw the crypto crash as an opportunity to reimagine the future of Web3.
• Onchain Data: In 2022, the volume of venture investments in Web3 games and the metaverse reached $7.6 billion.
• Deep Dive: Lamina1 is introducing the Lamina1 Ecosystem Fund (L1EF) to support developers working on open metaverse projects.

‍

Crypto Highlights

Is MANA on its way to reaching $1?

During 2023, the cryptocurrency market has seen a surprising resurgencein the performance of metaverse tokens, which had suffered heavy losses in 2022. Tokens such as Decentraland have emerged as top performers, with gains of up to 152% in January.

However, as of late, Decentraland's performance has started to decline, losing 13.4% over the past 30 days. This may prompt risk-seeking investors to explore other opportunities, such as artificial intelligence-related tokens. Given its recent decline, MANA’s ability to break through the $1 threshold in 2023 remains uncertain. In fact, it may face challenges in maintaining its momentum and attracting new investors, in particular in a competitive and constantly evolving crypto market.

There are reasons to be skeptical about the possibility of Decentraland's token gaining significant value in the near future. Firstly, the token has not established any real-world utility, since it is primarily a governance token for a small metaverse world. This means there are limited ways to exploit MANA outside the Decentraland ecosystem. Unlike Bitcoin MANA cannot be used to purchase items online that aren’t related to the Decentraland metaverse, such as virtual items for your in-game avatar.

Social Data

The growth of cryptos in the metaverse

The metaverse, cryptocurrency, and Web3 share a common thread of being hot technology buzzwords that are currently trending in the tech industry. However, for many tech developers and investors, these three concepts are closely intertwined and will be part of the decentralized internet, known as Web3.

As the metaverse is a three-dimensional virtual world and cryptocurrencies represent digital assets, they could come to rely on each other. Indeed, the metaverse could provide a unique use case for cryptocurrencies, allowing for virtual transactions and creating an economy within the virtual world. In turn, cryptocurrencies could help facilitate such transactions and enable the metaverse to function as a fully decentralized, user-controlled space.

At the heart of both cryptocurrency and the metaverse lies a fundamental piece of technology: the blockchain. Originally designed by Bitcoin creator Satoshi Nakamoto, the blockchain is a public digital ledger that records transaction data. Transactions that use blockchain networks can be peer-to-peer and eliminate intermediaries such as banks. This can reduce costs and speed up transaction times.

While commerce on the internet currently relies on the digital versions of traditional fiat currencies, currencies based on the blockchain are created as digital-native means of transacting business in a digital world. With this respect, the metaverse could use this technology to create permission-less interactions between internet users and enable decentralized marketplaces within the metaverse. Here, users could buy and sell virtual goods and services without the need for an intermediary.

Today, the metaverse is primarily dominated by the video game industry and other innovative start-ups. However, there are four early-stage projects worth watching that are actively working towards bridging the gap between cryptocurrencies and the metaverse: ApeCoin ($4,98), Decentraland ($0,60), Theta Network ($1,08) and Axie Infinity ($9,25).

Therefore, the interest in the metaverse could increase the prices of these cryptocurrencies in the long term. During the past week, moreover, investors have typed 90 times per day the words “Metaverse+blockchain”, showing particular attention to the topic.

‍

Financial Data

Roblox, DressX, and Emperia to the moon

The crypto market experienced a significant crash in 2022, resulting in the loss of billions of dollars for many investors. However, some experts saw this as an opportunity to refocus on truly innovative ideas and reimagine the future of Web3, which is increasingly linked to the metaverse.

Companies such as Roblox, DressX, and Emperia provided a glimpse into this uncharted territory through their successful ventures in digital currency, avatar fashion, and virtual shopping experiences. Nike also joined the Web3 hype by launching CryptoKicks NFTs that channeled sneaker-head culture, while LinksDAO brought decentralized golf to the blockchain with a virtual "country club" for players worldwide to connect.

Roblox is a virtual world platform that has transformed into a full-fledged entertainment platform, attracting 56 million daily active users in 2022. It is a year-over-year increase of 23%, with the fastest-growing age group being 17 to 24 years old. The company also implemented an age guideline system in September 2022 to encourage more experiences aimed at mature users. Roblox is often the go-to platform for brands and celebrities entering the metaverse, and its virtual currency, Robux, is the basis of a digital economy, with creators of games and virtual goods earning over $624 million in 2022, a 19% increase over 2021.

DressX, on the contrary, is a digital fashion designer that offers more than 3,000 articles of clothing for avatars. In particular, it is the largest collection of virtual fashion in the world and allows people to outfit their own avatars. The startup offers apparel from well-known brands such as Adidas and the prices reach $1,500, with the most expensive piece being a dress made to celebrate Ukrainian freedom. In April 2022, DressX became the first creator to use Roblox's layered clothing feature, offering a puffer jacket in digital leather for $35. The company also created looks for Meta's avatars in July and collaborated with Coca-Cola to design a rave-inspired collection for its Dreamland AR music experience in August.

Concluding, Emperia is a London-based startup that creates virtual stores for retailers to experiment with the space between physical shopping and two-dimensional e-commerce. Its Artemis platform was launched in 2022, targeting luxury fashion brands to manage product placement in virtual stores based on users' interactions without any technical expertise. Despite the ongoing criticism around the metaverse, Emperia has built virtual stores for notable brands such as Bloomingdale’s, Lacoste, Sunglass Hut, and Dr. Barbara Sturm.

‍

Onchain Data

GameFi investments reached $7.6 billion

As we’ve already seen, the blockchain industry faced several challenges in 2022, including the significant fall in Bitcoin's price and the collapse of FTX. However, despite these setbacks, the industry has remained resilient and has found new ways to thrive.

The main area of growth and optimism is the development of the GameFi industry. GameFi combines gaming, DeFi, NFTs, and the metaverse. In 2021, GameFi emerged as a leader in the crypto space, with successful projects like Gala Games, Decentraland, The Sandbox, and Axie Infinity. The GameFi sector continued to attract investments in the past year, with the volume of venture investments in Web3 games and the metaverse reaching $7.6 billion. Some analysts predict that the GameFi sector will be valued at $2.8 billion by 2028.

A year ago, Animoca Brands, a metaverse game developer, completed a $359 million funding round led by Liberty City Ventures, which put them at the top of the list for total investment rankings in the metaverse space. Since then, there have been several significant metaverse-related projects that have gained traction. The Sandbox, Phantom Galaxies, and REVV Motorsport are among the most notable examples.

The Sandbox is a virtual gaming world where users can create, share, and monetize their content, while Phantom Galaxies is a multiplayer game set in space. REVV Motorsport, on the other hand, is a motorsport game where players can buy, sell, and trade digital assets.

‍

Community

Interested in what the other readers think about it? Join our community on Discord and discuss our insights with other investors! [Join Discord]

‍

Deep Dive

Why Lamina1 is introducing the L1EF?

To support developers working on open metaverse projects and give investors an opportunity to invest in these projects at an early stage, Lamina1 is introducing the Lamina1 Ecosystem Fund (L1EF).

Lamina1 is a blockchain platform created by Neal Stephenson, a science-fiction author, and Peter Vessenes, a blockchain expert, with the objective of building the metaverse. Invite 3 friends to read the full article

‍

News of the week

• Banks: Investors step into U.S. bank stocks, but with some caution. [Read more]
• Technology: Russia's oil resilience may fade on a lack of technology. [Read more]
• Markets: Stocks gain, 10-year yield hovers around 4%. [Read more]
• Investments: Chinese brokerages pressured to end overseas investing services. [Read more]

Read the full version here.

About

Investoom is a Munich-based Fintech Startup democratizing the access to quantitative investment insights that are used by big hedge funds, but are inaccessible to retail investors. We are a market intelligence company that provides AI-powered investment insights through social sentiment data, onchain data and financial data.

Disclaimer: The Investoom newsletter is meant for informational purposes only. It is not meant to serve as investment advice. Please consult with your investment, tax, or legal advisor before making any investment decisions. [Read more].

Advertising and sponsorship do not influence editorial decisions or content. Third party advertisements and links to other sites where products or services are advertised are not endorsements or recommendations by Investoom. Investoom is not responsible for the content of the ads, promises made, or the quality or reliability of the products or services offered in any third party advertisement.