Glassnode: Is the Metaverse doomed? On-chain data tells you the answer.

Source: Glassnode; Compiled by Wuzhu, Golden Finance

This week, we introduced another exploration targeting CBD use cases - analyzing metaverse tokens. Although prices have fallen and the hype has gradually faded, on-chain data indicates that major investors remain active, steadily accumulating and lowering their cost basis.

Does this signal a long-term bet on the revival of the metaverse? Let's first review how to analyze and interpret CBD data, and then apply this knowledge to the latest trends in the metaverse.

Understanding the Cost Base Distribution

Cost Basis Distribution (CBD) tracks the position of the token supply concentration based on the holders' average cost basis. By analyzing the changes in supply distribution, we can identify investor behavior – whether they are accumulating, selling off, or reallocating their holdings.

How to Interpret the CBD Heatmap:

• Color Intensity (Supply Distribution)

Warm colors (red/yellow) indicate a high concentration of supply within a given price range, while cool colors (blue/green) indicate a lower supply volume.

• Y-axis (Cost Basis)

Each horizontal slice represents the price range of the last movement of a portion of the supply, showing how holders adjust their cost basis over time.

Tracking these changes helps us identify potential market turning points, where accumulation or distribution trends may indicate future price movements.

Metaverse Tokens: What Cost Basis Distribution Data Reveals

In this analysis, we focus on metaverse tokens — The Sandbox (SAND), Decentraland (MANA), and Axie Infinity (AXS) — which are among the most prominent assets during the metaverse craze of 2021. Although the hype around virtual worlds has subsided, our focus shifts from user activity to examining investor behavior using cost basis distribution (CBD) data.

We do not assess adoption metrics or in-game activities, but rather analyze how token holders adjust their positions over time. Are they selling off, holding steady, or accumulating at lower prices? By tracking supply changes at different price levels, we can gain insights into how investor beliefs evolve during the post-hype phase, and whether accumulation trends imply long-term confidence in these projects.

The Sandbox (SAND): Steady Accumulation in a Bear Market

Despite price fluctuations, on-chain data shows that accumulation continues. Holders with strong convictions are steadily increasing their positions, bolstering their confidence in the project's long-term potential.

Decentraland (MANA): Buy the dip

The concentration of supply has significantly increased, reaching around 0.60 dollars, reflecting an increase in purchasing activity after the price drop. This indicates that investors view the price drop as a buying opportunity rather than a sign of further decline.

Axie Infinity (AXS): Long-term confidence remains strong.

Despite the ongoing decline, on-chain data shows a gradual increase in large positions. This pattern suggests that some investors remain confident about the future of Axie Infinity.

Will the Metaverse Revive?

Speculation around the metaverse may have waned, but on-chain activity suggests otherwise. The continued accumulation of major metaverse tokens indicates that many investors view these projects as undervalued opportunities rather than failures.

Does this lay the foundation for a future recovery? Although the price trends remain uncertain, data shows that the confidence of major market participants is still strong—they are positioning themselves accordingly.