LONDON (Bywire News) - After a harrowing winter in which Bitcoin and other cryptocurrencies had slipped back alarmingly, investors are seeing the green shoots of growth once again. However, for those with the cash and the nerve, the real action is in games.
After slipping back during the summer, Bitcoin investors have had a welcome reason for cheer. With spring on the horizon, the daddy of all cryptocurrencies has been fighting back. Over the past two weeks, it has risen 16%. At the time of writing, it tops $44,000. As Bitcoin works further towards the mainstream in 2022, its price is rallying and confidence returning.
However, for those investors brave enough to risk some real action, the real interest lies in altcoins linked to computer games. Tokens linked to the 3D virtual environment, Decentraland, for example (Axie and Mana) have risen by 35% and 57% respectively in the same period. The Gala gaming platform’s token, meanwhile, has risen a staggering 125% according to data from CoinMarketCap.
For those investors, these newer tokens are in their early stages of growth and, as such, have much more capacity to demonstrate the stellar performance of Bitcoin in days gone by. As cryptocurrencies move into the mainstream, both bitcoin and the number two cryptocurrency, Ether, have been increasingly mirroring movements in the stock market.
Investors who saw Bitcoin as a way to diversify their risks into assets that were less impacted by inflation and other market influencers are now seeking to diversify away into other altcoins in the marketplace.
Gaming tokens is one area in which many investors see real prospects for growth. With Facebook’s CEO Mark Zuckerberg betting heavily on his Metaverse, the nascent virtual world has enormous scope for growth. However, this wild west world is not for the faint-hearted. The novelty of these tokens means they have no track record on which to base analysis. Their values are also purely linked to the success or failure of the gaming platforms on which they are based. This is, then, an extremely high-risk endeavour for investors in which they have everything to gain but everything to lose.
Nevertheless, there is a growing sense that the so-called bottom of the blockchain offers real buying opportunities. The growing interest in the metaverse is prompting people to look beyond Bitcoin at those altcoins which exist on the Layer 1 Protocol of the blockchain, the base level on which smart contracts between buyers and sellers are written in code and upon which virtual games and virtual worlds are built.
The likes of Ether, and its main challengers Polkadot and Solana, are reaping the dividends and have risen by 27%, 28% and 23%. For many people, this – for all the risks – is a moment to buy.
(Written by Tom Cropper, edited by Klaudia Fior)