About the editor: Spencer Noon is GP and co-founder of Variant. Founders should reply to this email to get in touch.

Network Coverage: Metaverse
This week our contributor analysts cover Metaverse-related projects: Decentraland, Axie Infinity, Loot, and CryptoPunks.

• Decentraland is a virtual world built on Ethereum where users can buy, sell, and customize land parcels and other collectibles. After Facebook’s rebranding announcement, Decentraland’s MANA token saw a 4,000%+ increase over the past week. While it’s difficult to separate wallets of investors/speculators from the platform’s users, active wallets addresses with MANA tokens smashed through all-time highs in recent days, and the project is being considered a pioneer of the decentralized metaverse.

• The MANA token serves as the virtual economy’s currency and governance token; 2.5% of MANA in each transaction are burned. While there was a significant increase in marketplace fees in USD, MANA burned experienced a noticeable uptick but less drastic than in USD, especially compared to late 2020.

• Over 99% of the 30D volume was LAND – ERC-721 tokens for virtual land parcels – or estates, which are adjacent LANDs aggregated by users. The 30D marketplace volume also showed little interest in collectibles, as well as in wearables and names which only accounted for about 0.13% and 0.02% of the 30D volume, respectively.

• The daily active addresses on Axie’s Ronin Chain saw an almost 100% spike in a single day. Katana is a native AMM based dex built on Ronin aimed at reducing transaction costs for users within the Axie ecosystem. The release of Katana was accompanied by the announcement of their upcoming launch of RON, Ronin's native token. Users looking to farm RON tokens are required to stake AXS, ETH, SLP, or USDC into Katana’s pools.

• Total revenue on Axie Infinity is set to cross a billion dollars across breeding, NFT sales, and marketplace fees paid by users. According to DApp Radar, close to a million different wallets have conducted trades cumulating to $2.9B for Axie related NFTs.

• At $2.8B, Ronin currently does more in NFT volume than Solana and Flow according to Cryptoslam.io. Ronin also reports a higher number of transactions (8M) for NFTs than Ethereum and Solana combined (4.2M) according to Cryptoslam.

• Loot burst into the spotlight in late August representing a paradigm shift in the NFT space; it introduced a bottom-up approach to value creation where the community was left to build the future of the project. With no company, art, team, or attributes, Loot makes it impossible to gate-keep any creative decisions. In the first month, 123 projects remixed or built on Loot. Today there are 2,538 unique owners. Over 5,000 unique wallets have held Loot at some point in time.

  

• By measuring the concentration of tokens among holders, one can assess the strength of a project's community. Ideal NFT collections tend to have low concentration, favoring individual participants over many whales. The top loot holder currently owns 238 Loot or 2.98% of the entire supply.

• Several of the largest Loot holders have actually trimmed their Loot bags. As a whole, this is healthy for the project as it reduces whale concentration at large. Top 5 Loot holders currently hold 11.3% of the supply.

• On October 29th, a sale of ~125K ETH or 500M USD involving punk #9998 printed on-chain, claiming the top spot on all leaderboards and sending twitter into amok. Soon after it became known that this was a flash loan powered wash-sale. Nature has healed since, but on-chain history remains unchanged raising important questions on the gameability of on-chain leaderboards. Is this the point where we bring TCRs back?

• Aside from that, marketplace activity going through the punks contract has tamed over the past month, hitting a 2021 low with only 33 on-chain txs printing this week. Average sale prices have deflated by almost 50%, but at the same time the NFTX Punk Vault looks primed to hit new all-time highs.

• In Issue #86 of Our Network, this segment called out "Pink with Hat" and "Buck Teeth" as potentially undervalued. They have both repriced upwards since, with their average historical prices catching up to their rarity cohort comparables. Are "Rosy Cheeks," "Blonde Short," and "Spots" next?