First Mover Asia: For the metaverse to be a $ 13,000,000 opportunity, many things need to change; Bitcoin surpasses $ 31,000

Citi Report makes bold predictions, but major Metaverse platforms struggle to attract engaged users; altcoins are mixed.

Good morning. Here’s what happens:

Price: A late surge took bitcoin to over $ 31,000 from where the week started.

Insights: A Citi report calculates the potential value of the metaverse at $ 13 trillion, but platforms are struggling to attract engaged users.

Technician’s Opinion: The price rebounds have been short-lived, indicating a loss of purchasing power.

Prices

Bitcoin (BTC): $ 31,285 -0.07%

Ether (ETH): $ 1,828 -1.5%

The biggest winners

Good Teletypewriter Return DACS sector
Chain link LINK + 9.1% Informatics
gimbal ADA + 1.2% Smart contract platform
XRP XRP + 0.8% Currency

The biggest losers

Good Teletypewriter Return DACS sector
internet computer PCI -8.7% Informatics
Solana FLOOR -7.4% Smart contract platform
Classic Ethereum ETC -4.0% Smart contract platform

Bitcoin lags behind to return above $ 31,000

Bitcoin returned above the $ 31,000 mark on Tuesday following the introduction of a federal cryptocurrency bill that would address a number of major regulatory issues plaguing the industry. Ether and other major digital assets also rose in the afternoon, regaining ground lost earlier in the week.

The largest cryptocurrency by market cap traded above $ 31,200, roughly unchanged in the previous 24 hours, but well above its temporary position below $ 29,300 in US exchanges. Bitcoin fell late on Monday and continued to trade in an unstable range between widespread investor concerns about inflation, geopolitical turmoil and the global economy.

Ether, the second largest cryptocurrency, has recently fallen by more than 1%, trading just above the $ 1,800 level. Other major altcoins were mixed with SOL over 7% but LINK rose over 8%. Sentiment remained bearish.

“Markets continue long-term downtrend, but recent US crypto-friendly bill provides short-term support as it proposes to squeeze the sadly too big. [Securities and Exchange Commission] in terms of cryptocurrency jurisdiction, “James Key, CEO of the 3 Autonomy Network web protocol, told CoinDesk.

Equity markets, which have been swinging up and down in the past few days as investors digested some bullish treats and their recent bad news regime, soared on Tuesday with the Nasdaq, S&P 500 and Dow Jones Industrial Average all up by over. half a percentage point.

However, investors had cause for concern on Tuesday. The World Bank reduced its global economic growth forecast for 2022 to 2.9%, down from 4.1% in January. World Bank Group President David Malpass called the “risk” of stagflation “considerable”. Later in the day, US Treasury Secretary Janet Yellen told the Senate Finance Committee that she expected inflation to remain high. And less than three weeks after reporting disappointing first quarter results, Target warned investors that its earnings would plummet due to the change in consumer behavior that created imbalances in its inventory.

Many analysts expect the cryptocurrency bear market to get worse in the near future, and Key noted that Bitcoin’s previous bearish cycles bottomed out after an 85% decline in value in at least 18 months. The current market has lost nearly 60% of its value since it hit an all-time high last November.

“I really doubt it’s the bottom,” Key said. “Furthermore, these previous cycles were all in a long-term bull market, while this is not true for the first time. When institutional investors cut risk, “exotic” and risky assets like cryptocurrency are the first to sell off, indicating that this time around it has the potential to be a worse bear market. “

Markets

S&P 500: 4,160 + 0.9%

DJIA: 33,180 0.8%

Nasdaq: 12,175%

Gold: $ 1,851 + 0.6%

Knowledge

The metaverse struggles to attract engaged users

A recent report from Citi calculated the total addressable market value of the metaverse at $ 13 trillion.

If accomplished, that would be an impressive achievement given that the games market is only worth $ 180 billion, according to game research house NewZoo, and the PC gaming hardware market is only $ 5.7 billion.

For the most part, the Metaverse market is just a minor version of the gaming market. Exchange-traded funds (ETFs) Metaverse, with their exposure to publicly traded cryptocurrency companies, have lagged behind their gaming counterparts in the market, despite being mostly the same.

Citi says the $ 13 trillion figure comes from all “Internet-related revenue to that from displaced businesses in the physical world.” This makes huge assumptions about the future of ecommerce, as it implies that all parts of the ecommerce stack will be interrupted by the metaverse.

This almost parallels the bullish augmented reality (AR) mindset in the late 2010s. The mobile-centric was poised to disrupt many parts of the internet economy, from gaming to advertising.

But AR space failed to generate useful unicorns. Blippar, a promising London-based startup that merged artificial intelligence (AI) and AR, went bankrupt in late 2018 after raising $ 37 million at a $ 1 billion valuation.

The app promised to revolutionize e-commerce by allowing users to point their phone at any object and get whatever information the app could glean from visual recognition and online searches. It could also be used to provide enhanced 3D visualizations of products, improving online sales opportunities for retailers. It was all very interesting and promised new revenue models, but the user base never materialized.

Aside from Blippar, Magic Leap, which released promising initial visuals it never managed to deliver, sucked the life out of capital markets for AR capital markets, depriving many promising AR startups of their means to create this augmented reality. promise. Despite Pokemon Go’s success, there simply wasn’t another AR unicorn like this one.

Going back to Citi’s metaverse predictions, just like the bull market around AR in the late 2010s, something is missing: users. On-chain data shows that despite high ratings, the metaverse majors are struggling to build a user base, with some having only a few thousand at most compared to the tens of millions of players playing simultaneously on Steam or Xbox. Live.

And it’s not because they’re new platforms: the Steam PC gaming network has reached 1.5 million concurrent users six years after launch; Decentraland currently has fewer than 1,200 active users and has been open to the public for two and a half years.

We still have a long way to go before the metaverse becomes a $ 13 trillion opportunity.

Opinion of the technician

Bitcoin’s daily chart shows support / resistance. (Damanick Dantes / CoinDesk, TradingView)

Bitcoin (BTC) remains in an unstable trading range as short-term indicators are neutral. The cryptocurrency could find support at $ 25,000 and $ 27,000 as its price continues to stabilize from last month’s selloff.

BTC has dropped 4% in the past 24 hours.

The Relative Strength Index (RSI) on the daily chart fell back below the neutral 50 threshold, indicating weak momentum behind the latest price increases above $ 30,000. On the weekly chart, the RSI is the most oversold since March 2020, which preceded a rise in cryptocurrency prices.

However, the indicators could remain oversold for several weeks, especially in a downtrend in prices. This means that the upside may be limited for BTC, with an immediate resistance at the 50-day moving average of $ 33,371.

Important events

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