Not everyone is convinced that Mark Zuckerberg’s massive metaverse experiment is a good idea. Since Facebook rebranded to Meta in 2021, the social media giant’s focus has increasingly shifted to connecting the digital and physical worlds through augmented reality. However, a shareholder of the company recently issued a letter to the CEO calling the metaverse investment “super-sized and terrifying.”
It didn’t take long for those concerns to be justified. Meta published its third-quarter financial results after the bell on Oct. 26 and, perhaps unsurprisingly, its metaverse division underperformed. Meta’s Reality Labs lost a whopping $3.672 billion during the quarter, mirroring a similar decline in Q1. That’s the risk you run when you venture into unchartered territory. For all the hype surrounding the metaverse, these new social worlds remain largely empty. Will Meta fill the void? Only time will tell.
This week’s Crypto Biz chronicles Meta’s metaverse experiment, Tesla’s Bitcoin (BTC) holdings and the sudden surge in Reddit’s nonfungible token (NFT) collection.
Tesla’s Bitcoin losses rise to $170M in the first 9 months of 2022
While Tesla’s foray into Bitcoin was initially praised by the crypto community, the whole ordeal has been a far bigger distraction for the electric vehicle maker. In the second quarter, Elon Musk’s company sold 75% of its remaining Bitcoin holdings, which added roughly $936 million to its balance sheet. By the end of Q3, Tesla’s remaining BTC was sitting at an unrealized loss of $170 million, according to a new disclosure filed with the United States Securities and Exchange Commission. The company’s net loss from BTC isn’t as bad, though, given that Tesla had realized $64 million in profits during its previous sale. Musk proved to have paper hands, after all.
CashApp adds support for Bitcoin Lightning Network
Cash App users will soon be able to send BTC to each other through the Lightning Network, the highly touted layer-2 payment protocol that’s supposed to make Bitcoin transactions faster and more scalable. To be clear, Cash App already supports Bitcoin transactions on Lightning in a limited capacity through QR codes. Now, the popular mobile app will give users the ability to send $999 worth of BTC every seven days. The catch is that the service is only available to residents of the United States, excluding New York. While estimates vary, Cash App is said to have roughly 80 million users. Imagine this demographic transacting regularly on Lightning one day.
You can now receive #bitcoin instantly via the Lightning Network in @CashApp! ⚡
– Open Cash App
– Money tab -> Bitcoin
– Share QR code or linkWhat do you think?
Try it by sharing your link below pic.twitter.com/rg1BbzyLMB
— Michael Rihani⚡️ (@MichaelRihani) October 25, 2022
Reddit NFT trading volume hits all-time high as wallet holders near 3 million
Crypto winter has been especially hard on NFTs — a once booming market whose trade volumes have plummeted over the past year. But, for social media platform Reddit, NFT interest appears to be surging. Data from Polygon and Dune Analytics revealed this week that the trading volume of Reddit’s NFT avatars eclipsed $1.5 million over a 24-hour period, bringing the collection’s cumulative volumes to $4.1 million. Since Reddit launched its collection in July, more than 2.9 million collectible avatars have been minted. You’re going to love the data breakdown in this story.
Zuckerberg’s $100B metaverse gamble is ‘super-sized and terrifying’ — Shareholder
Some of Meta’s own shareholders are growing weary of its metaverse gambit — and the colossal price tag behind it. Altimeter Capital CEO Brad Gerstner penned a letter to Mark Zuckerberg, urging that the company slash its annual metaverse investment budget from $10-$15 billion to $5 billion. He called the hyper-fixation on metaverse technology “super-sized and terrifying.” Altimeter Capital owns a 0.11% stake in Meta, so it’s unlikely that Zuckerberg will heed the warning. But, a $10 billion annual investment by Meta translates into $100 billion in 10 years on a concept that Gerstner says is far from proven.
Before you go: Why are Bitcoin whales accumulating?
Has Bitcoin reached its definitive bottom for this cycle or is there room for one final capitulation? This question has divided the Bitcoin community, which continues to anticipate a major breakout in the coming weeks. For dedicated hodlers, though, timing the bottom won’t matter in the long run. While retail was busy selling sub-$20,000 BTC, the whales have been quietly accumulating. In the latest episode of Market Report, Cryptox’s analysts discuss why Bitcoin whales have been stacking sats and what it could mean for the market in the short term. You can watch the full replay below.
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