The hype of the Metaverse certainly declined considerably in the last two months as the market crashed twice, and the likes of Decentraland stand on the receiving end of this bearishness.
The Metaverse token MANA is witnessing fear in its investors after a very long time, and it might cause a further drawdown in the price.
Although this crash didn’t affect MANA as terribly as the crash of May did, which wiped out 57.4% of its value, the altcoin still did decline by 22.8%. MANA had already recovered a significant amount of the crash from May within the next 48 hours.
But the lack of confidence from investors resulted in gradual depreciation in price, resulting in the altcoin trading at $0.81 at the time of writing.
Decentraland price action | Source: TradingView – AMBCrypto
This shaking faith is visible in the fact that for the first MANA, long-term holders evinced panic and moved around their holding. As a result, they ended up destroying 17.79 billion days.
A move as significant as this was last noticed in October 2021 when the same LTHs destroyed 45 billion days.
Decentraland LTH supply movement | Source: Santiment – AMBCrypto
Although the last time, this reaction was due to FOMO panic and not loss-induced panic, as MANA had rallied by 375% in the span of 3 days (ref. Decentraland price action image).
This is verified by the transactions conducted in these two instances.
Back in October 2021, MANA noted most of its transactions were conducted in profit, with volumes reaching as high as $670 million, whereas this time around, the transactions have primarily been in losses, albeit with a much lower volume of $88 million.
Decentraland transactions in losses | Source: Santiment – AMBCrypto
Plus, the diminishing value of the Metaverse is also becoming more apparent by the day. The value of a single plot of land in Decentraland back in February was worth $6,170, whereas as of this month, the average value is $3,420.
This is the lowest average value Decentraland has witnessed since its launch in 2020.
Decentraland LAND plot average cost | Source: Dune – AMBCrypto
Thus MANA is just as much dependent on the broader market cues as it is on the Metaverse to recover going forward to reclaim $1 and rally further.