As bitcoin drifts towards mainstream maturity in 2022, daring crypto investors are eyeing up new sources of explosive action: "altcoins" that power online games and worlds
Bitcoin , which like the rest of the market had been largely sinking since late 2021, has risen about 16% over the past two weeks to push above $41,000
Yet newer and smaller coins linked to virtual platforms have enjoyed stronger rallies amid the buzz around the metaverse
Those used on gaming platform Axie Infinity and 3D virtual environment Decentraland, for example - the Axie and Mana - have gained 35% and 57% respectively in the same period since Jan. 24. The token of the Gala gaming platform has jumped 125%, according to CoinMarketCap
To give an idea of scale, though, the combined market cap of Axie, Gala and Mana is about $12.7 billion, a fraction of the $800 billion-plus for bitcoin, which commands 40% of the market
In a possible sign of this drive, multi-asset funds managing a combination of coins saw inflows totalling $32 million in the week ending on January
Yet the sheer novelty of many of these coins and the consequent lack of track records significantly ups the danger stakes for investors in an already risky and nebulous crypto world
Furthermore the fortunes of the likes of Axie and Gala are tied to the success of their gaming platforms, as well as the wider virtual economy
Back with bitcoin - even though the dominant cryptocurrency is rallying after nearly halving in value between early December and January
Will Hamilton, head of trading and research at Trovio Capital Management, cites futures funding rates, which have remained negative since early December and suggest people are paying to be short