What Happened to Metaverse – the Once Booming Crypto Sector?

In 2021, the Metaverse was once crypto’s most trnding crypto sector. Tokens like The Sandbox (SAND), Decentraland (MANA), and Axie Infinity (AXS) surged in value. Projects promised fully immersive virtual worlds where users could play, build, and earn. Major brands bought virtual land, venture capital poured in, and even Facebook changed its name to Meta to show its commitment to the space.

These developments fueled a sector-wide rally. The Metaverse became one of the most talked-about narratives during the 2021 bull run, driving millions of dollars in trading volume and speculation.

However, much of that momentum began to fade by early 2022. Token prices dropped sharply, daily user numbers declined, and projects struggled to retain attention. The broader crypto bear market only made conditions worse. By 2023, most Metaverse tokens had lost over 90% of their value.

Public interest faded, media coverage shrank, and investors shifted focus to new trends like artificial intelligence and real-world asset tokenization. The Metaverse narrative was widely considered dead.

What the Data Says About Investors

A recent report from blockchain analytics firm Glassnode suggests the Metaverse story may not be over. The research used Cost Basis Distribution (CBD) to study how token holders have behaved in this post-hype environment.

CBD data helps analyze where token holders last moved their assets and at what price points. By mapping this across price levels, analysts can understand whether investors are buying more (accumulating), selling at a loss (capitulating), or simply holding on.

Unlike market price data, which reflects short-term sentiment, CBD provides insight into longer-term conviction. In the case of Metaverse tokens, the data indicates quiet but persistent accumulation at lower price levels.

The Sandbox (SAND) — Quiet Accumulation at Lower Levels

The price of SAND has fallen by nearly 97% from it’s all-time high above $8, now trading at roughly $0.26. Despite this, Glassnode’s data shows steady accumulation between $0.20 and $0.50 throughout the recent bear market.

This pattern indicates that while speculative interest has declined, some investors continue to accumulate SAND, likely betting on its long-term utility and ecosystem development. Rather than exit the sector, these holders appear to be averaging down their cost basis.

MANA, the native token of Decentraland, has also fallen from highs above $5 to around $0.23. Still, Glassnode observed a significant supply concentration forming between $0.55 and $0.65 in late 2024. This suggests that investors responded to falling prices by re-entering the market or adding to their positions. 

Axie Infinity (AXS) has experienced one of the most severe downturns among Metaverse assets. From a peak near $165, it now trades below $3—down over 98%. Yet, on-chain data shows accumulation continues, particularly between the $5 and $10 range.

The total Metaverse crypto token market cap now stands at approximately $8.49 billion, far below its 2021 peak of $38 billion. Leading tokens like SAND, MANA, and AXS have all seen weekly losses between 8% and 15%, while trading volume has dropped over 29% in the past 24 hours.

Despite this drastic downturn, the CBD data shows that long-term holders have not entirely abandoned the sector. In fact, accumulation patterns suggest these investors may see today’s low prices as a strategic buying opportunity.

Is the Metaverse Crypto Sector Dormant, Not Dead?

From the outside, it might look like the Metaverse crypto trend is over. The hype is gone, prices are low, and fewer people are talking about it. But on-chain data shows that long-term investors are still active. They are not giving up. They are quietly preparing for a future comeback.

No one knows if the Metaverse will become popular again. It depends on many things—technology, gaming trends, and new use cases. But for now, one thing is clear: the Metaverse is not dead. It is sleeping. And some investors are still holding on.