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Even as Bitcoin and the whole crypto market valuation fell last week, Metaverse, gaming, and incentive-offering DeFi tokens soared. This is why.
Looking at the winners and losers over the last seven days, it may appear that cryptocurrency markets are in the black. Despite this, total market value declined 6.7 percent to $2.72 trillion as the price of Bitcoin (BTC) retraced 8.3 percent to $58,425.
The only connection between this week’s top gainers seems to be the metaverse and gaming sector, which has been on a bull run since Facebook rebranded to Meta on Oct. 28, signaling its new focus on that segment. Further bullish news backing the current surge in metaverse-related tokens is the Nov. 19 raise of $400 million by the Gemini crypto exchange to build a decentralized metaverse.
Top performers had specific reasons for the pumping
Gala (GALA) pumped after its Coinbase and Huobi listing on Nov. 16. The utility token powers a decentralized gaming ecosystem that gives players a voice in the funding and development phases.
On Nov. 18, Crypto.com (CRO) has its own news to justify the surge. The marketing department of the Singapore-based exchange agreed to spend $700 million to buy the naming rights to the Los Angeles Lakers’ home stadium.
Elrond (EGLD) also announced a $1.29 billion incentive scheme on November 19 in order to lure users and liquidity to its decentralised finance ecosystem. The project employs sharding technology to achieve a transaction rate of up to 15,000 per second (TPS).
Decentralized exchanges tokens take a hit
Two decentralised exchange utility tokens were among the poorest performers. The lone piece of bad news appears to be Caroline Crenshaw’s article published on November 9th by the US Securities and Exchange Commission. The lack of market protections in the sector, according to the report, raises worries about pseudonymity and market manipulation.
After a 122 percent 7-day rise on Sept. 3, fuelled by a protocol upgrade that allowed ERC-20 and ERC-721 token interoperability, Quant (QNT) is still in a decline.
After a 38 percent 7-day pump on Nov. 2, Vechain Thor (VET) retraced ahead of the release of its proof-of-authority (PoA) mechanism v2.0 testnet on Nov. 5. The upgrade provides a more secure method of choosing block producers.
The OKEx Tether (USDT) premium, which measures the difference between its China-based peer-to-peer (P2P) trades versus the official U.S. dollar currency, has improved slightly.
The current 99 percent indicator is mildly bearish, indicating low desire from cryptocurrency traders to convert cash into stablecoins—a far cry from the 5% discount seen in mid-October.
Meanwhile, the broad price drop had a negative impact on bitcoin total futures open interest. Nonetheless, the move was predicted, given that the overall market capitalisation retraced and $2.7 billion in liquidations occurred throughout the week.
Despite this, the indicator remained at a solid $50.3 billion, which is up 60% from two months ago. It’s worth noting that a drop in open interest isn’t inherently bearish; nonetheless, as more liquidity providers and market makers enter the market, maintaining a particular level is interesting.
Although the above data may not appear to be encouraging, given that Bitcoin (BTC) and Ether (ETH) both suffered significant losses this week, the overall market structure held up well. Those anticipating a “altcoin season” may have been disappointed, but there were no large-scale losses of 15% or more.