It has been a volatile week for the cryptocurrency market. Bitcoin (BTC) just reached a new all-time high of $68,547 on Wednesday, only to take a steep dive downwards the same day, reaching a low of $64,200. The recovery is still awaited.
Ethereum (ETH) also saw a new all-time high of $4,850 on Wednesday, only to drop by $300 later in the day. However, Ethereum managed to recover better than Bitcoin over the following two days. The ETH/USD trading pair reached $4,800 again last night.
However, at the time of writing, the number 2 cryptocurrency stands at $4,621. This morning, we once again saw rapid declines in the crypto market. Bitcoin at $63,606 is even lower than Wednesday's low.
Yet, there are also two big winners today in CoinMarketCap's top 100, Decentraland (MANA) and the Sandbox (SAND). Both projects are trying to create their own Metaverse. MANA and SAND saw 24-hour gains of 28.80% and 16.65% respectively.
So, both Bitcoin and Ethereum reached new record highs this week. While many had expected both cryptocurrencies to immediately enter price discovery mode - and thus continue their steep rise - the opposite turned out to be true. The ensuing steep drop caused Bitcoin alone to liquidate $133 million in long positions.
Nevertheless, experts expect a continuation of the upward trend due to the upcoming Bitcoin Taproot upgrade. The update, expected this weekend or early next week, is described as the most significant upgrade to the Bitcoin blockchain protocol in years.
"Bitcoin's "price is undoubtedly supported by the upcoming Taproot upgrade," Singapore-based trading firm QCP Capital, wrote in its Telegram channel on Wednesday. "This is the biggest upgrade since SegWit in 2017 and will improve a whole range of important features. ... We are holding long bitcoin during this important event."
The term "Metaverse" can be explained very broadly, but it boils down to a virtual-reality universe in which users, often through an avatar, can interactively look around and make use of what the environment has to offer.
The "ideal" Metaverse is one where all the individual Metaverses are linked together, allowing you to switch from one world to another.
It may sound vague, but the Metaverse has been by far the most discussed topic in crypto over the past month. This is largely because Facebook changed its name to Meta, with the aim of creating a Metaverse for the entire world.
The cryptocurrencies Decentraland (MANA)
and the Sandbox (SAND)
also benefited greatly from this publicity, making triple-digit percentage gains in just one month. Today, they did so again and the question is how far these rises will continue in the time to come. In the meantime, the Metaverse has become an indispensable part of the crypto industry.