Companies deeply connected to the business of creating parallel digital worlds, such as gaming giant Roblox and NVIDIA, the market leader in interactive graphics processors, have seen their value drop faster than the technology sector as a whole. The comparison was drawn by Wonderinterest Trading, which presented its products in March, including the so-called Metaverse index or Trade Responsibly (investing based on sustainability), to the Spanish market.
"Investors that invest into companies creating metaverse were not very pleased last year, but if we review the development in recent months, the situation seems more encouraging. The progress only demonstrates that short-term fluctuations are not indicative of long-term trends," said Olivia Lacenova, chief analyst at Wonderinterest Trading, and added," Recall the dot.com bubble and its bursting in the early years of the millennium. Years ago, many experts had predicted a halt in e-commerce growth or even a dead end in retail development. We
are well aware now that it was just a logical correction of the excessive development. Today, e-shops account for tens of percentages of total trade and are gradually stealing a bigger and bigger share regardless of the inflation and bursting of any bubbles."
Over the past year, Roblox has gone from negative numbers to just above zero (0.65%), NVIDIA has also managed a fairly decent gain of 9%. The NASDAQ index, however, has fallen nearly 10% over the past year. The companies that have been hit the hardest by the price drop, however, are those in the virtual currency world. Coinbase, which is part of the Metaverse Index for the cryptocurrency sector, fell by a staggering 62%.* The FTX exchange's decline in value had a strong impact on the price progress. While the story of its collapse is rather series of personal failures, it is linked to the general nervousness in the technology asset market.1
The panic of falling into "the virtual space" is also well illustrated by comparison of the four major players of the metaverse: Microsoft, Amazon, Alphabet and Meta Platforms. Amazon is clearly a loser in terms of value as it had to cope with a share price drop of one third. Shares of giant Alphabet's (from the parent company Google) are following close behind, with the company writing off 25% of its value.*
Resource: Investing.com, Metaverse index
* Past performance is no guarantee of future results.
1 The share value comparison from 8.3.2022 to 8.3. 2023.
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Wonderinterest Trading Ltd is a Cyprus Investment Firm (CIF) supervised and regulated by the Cyprus Securities Commission (CySec) with CIF licence number 307/16 and company registration number HE 332830. Wonderinterest Trading provides investment services in EU member states.
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