Sandbox and Decentraland are caught in the SEC’s crosshairs
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The Sandbox and Decentraland were two of the first in Web3. During the digital land rush of 2021, speculators paid hundreds of thousands of dollars for a plot of land in each metaverse. Some that stand out include a $4.3 million purchase in Sandbox by Republic Realm (now Everyrealm) or Tokens.com’s $2 million purchase round in Decentraland.
Their respective cryptocurrencies, SAND and MANA also skyrocketed. In November 2021, SAND reached a high of around $8.44 and MANA reached a high of $5.90. On Friday, the tokens were trading at 48 cents and 41 cents, respectively, down more than 90%, according to CoinMarketCap.
This week, the SEC said in a lawsuit against Binance and Coinbase that both the SAND and MANA tokens were securities, a move that does not bode well for either platform.
Sébastien Borget, CEO of The Sandbox, appeared on Wednesday as if SAND was labeled a security, saying the complaint does not change the company’s day-to-day operations, Decrypt reported.
“We are aware of the lawsuits against Coinbase and Binance, and we disagree with many of their characterizations,” The Sandbox said in a statement to Fortune. “We hope this eventually leads to more clarity in the US around crypto.”
For its part, Decentraland has not released an official statement on the SEC’s allegations and has not sent a response to my request for comment.
Although the lawsuits could take years to play out, the SEC’s allegations are a setback for a Web3 space already suffering from slowing momentum. Robinhood has already said it will no longer support three of the cryptocurrencies mentioned in the complaint: Cardano, Polygon and Solana.
Because SAND and MANA are the lifeblood of the in-game economies that separate their platforms, being removed from exchanges could throw another wrench into the business of virtual worlds.
A look at Web3 gaming
Although the NFT market last month fell below $1 billion in monthly trading volume for the first time this year, Web3 games are holding steady, according to a report from DappRadar.
The blockchain analytics firm reported in its latest blockchain gaming report that on-chain gaming activity saw a 6% increase in May. And despite a general decline in chain transactions, gaming still accounted for 36% of all activity.
In other news
Crypto exchange Kraken launched the final version of its NFT marketplace after months of beta testing. The new marketplace will not charge gas fees for buying or selling on the platform and expanded its offering to 250 gatherings from the 70 originally promised. The company claims there are thousands of them NFTs available for less than $100.
Louis Vuitton released its first NFT trunk. The collection includes “a few hundred” digital suitcases called “Via Treasure Trunks“the costing $39,000 each. They are available in the US, Canada, France, UK, Germany, Japan and Australia. Trunk buyers will get access to upcoming Louis Vuitton products and events throughout the year.
Cougar plans an NFT sneaker collaboration with NBA player LaMelo Ball and the NFT project Boys Cat Gang, Decrypt reported. The GutterMelo MB.03 Digital Sneakers will go on sale June 29th and retail for around $175 at Open sea. Buyers of NFTs can redeem them from July 18 to August 20 for a physical version.
This story was originally featured on Fortune.com
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