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This Week in the Metaverse: Crypto Lehman Brothers Moment and Tesla Drops Bitcoin Holdings

Things are moving fast in the metaverse and the wider world of Web3 as a whole. Depending on who you ask, this futuristic blockchain-based space is either the next big thing for marketing — and pretty much everything else — or an overhyped fad. Here’s what you need to know from the past week:

Leading crypto lending firm Celsius Network filed for Chapter 11 bankruptcy last week. Some analysts are calling the incident the “Lehman Brothers moment” of crypto, drawing a comparison between the collapse of the crypto lender and the collapse of the major bank leading to the 2008 financial crisis.

In its bankruptcy filing, Celsius Network blamed its financial downfall on the ongoing “crypto winter” and “negative media and social media comments about Celsius, a number of which were unsubstantiated and misleading”. The company’s problems, according to the filing, have also been compounded by global economic pressure caused by the Covid-19 pandemic and the war in Ukraine.

Tesla Inc recently converted most of its bitcoin holdings to cash / Adobe Stock

The company owes its users — currently numbering about 1.7 million — about $4.7 billion, according to the filing.

Tesla sells majority of its Bitcoin, citing Covid-19 lockdowns in China


Tesla Inc disclosed this week in a second-quarter earnings letter that it had converted about 75% of its bitcoin holdings into fiat currency, which in turn added about $936 million in cash to the company’s balance sheet. society. On an earnings call, Tesla Chief Executive Elon Musk said the company decided to sell off the majority of its Bitcoin in response to “the uncertainty of Covid lockdowns in China.” Since this week, several cities have been locked down and millions of people have been quarantined in China due to an increase in Omicron subvariants.

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Tesla’s relationship with Bitcoin has oscillated between hot and cold: Tesla bought around $1.5 billion worth of Bitcoin in early 2021, sending the cryptocurrency’s value skyrocketing. For a time, the company allowed customers to make purchases using Bitcoin, but this policy was soon abandoned; in a May 2021 Tweet, Musk said the company would no longer allow payments using Bitcoin due to “concerns about the increasing use of fossil fuels for Bitcoin mining and transactions, particularly coal.” Musk also said on the recent earnings call that Tesla is “certainly open to increasing [its] Holdings of bitcoins in the future.

So should this be taken as a verdict on Bitcoin? After hitting an all-time high valuation of nearly $69,000 in November, Bitcoin has been plummeting since May in what many are calling a new “crypto winter.” Bitcoin is valued at the time of writing at around $22,500.

Christie’s launches a web3 investment company


The auction house Christie’s announced on Monday the launch of “Christie’s Ventures”, an investment fund specifically dedicated to web3. The fund — designed to “provide financial resources and expert support to emerging technologies and fintech companies creating solutions relevant to the art market,” according to a press release — debuted with an investment in LayerZero Labs, a company developing a protocol for omnichain interoperability.

Christie’s, founded in 1766, has made a name for itself in the Web3 space as a prominent NFT auction house; it made headlines last year with the historic sale of Beeple’s “Everydays: the First 5,000 Days” token for over $69 million.

Second Life Teams Up With DJ Superstar Eli Brown For ‘All New Metaverse Music Video’

Electronic music artist Eli Brown has teamed up with Second Life – an online platform that allows users to interact with each other as virtual avatars – to produce “Club Arcane”, an experience interactive that “literally puts listeners into a whole new metaverse music video“. according to a blog post on the company’s website. The description of the new virtual experience makes it sound like a cyberpunk haunted house layered with house music: visitors can expect “eerie melodies”, “eerie visuals”, “eerie alleyways”, “and a neon-lit nightclub brimming with hidden surprises at every turn.”

Nike and RTFXT launch an AR-enabled hoodie


Shortly after Nike acquired virtual apparel design studio RTFKT (pronounced “artifact”) in December 2021, the two companies dropped CryptoKicks – a “repeatable” fusion of a sneaker and an NFT. Now, Nike and RTFKT – a power couple on the rising virtual fashion scene – have launched a physical hoodie with augmented reality (AR) capabilities.

The RTFKT x Nike AR Genesis Hoodie, as it’s known, will come with an embedded Near Field Communication (NFC) chip, allowing its wearer to link it to an AR program – accessible via a QR code emblazoned with the front of the hoodie. The program allows the wearer to add a number of bling-out virtual accessories to the hoodie (wings, for example).

It will only be available to CryptoKicks owners and CloneX avatar collection owners.

The Metaverse is on the cover of Time magazine


For decades, Time magazine has been something of a beacon of American culture; its cover usually depicts some of the most influential people and ideas of the time. So it’s significant that the magazine dedicated its August 2022 issue to the metaverse.

The cover art, designed by digital artist and former Major League Baseball shortstop Micah Johnson, features a rendering of a young man wearing an astronaut helmet and walking through some sort of portal, separating his bedroom from a sci-fi kingdom filled with flying cars and a futuristic cityscape. The title? “Into the Metaverse: The Next Digital Age Will Change Everything.”

Usain Bolt enters web3


Step App – a fitness finance platform (fitfi) that allows users to earn cryptocurrency through physical activity – announced a new partnership with eight-time Olympic gold medalist Usain Bolt on Thursday. “With Step App, the blockchain economy expands beyond finance by incorporating elements of lifestyle, fitness, and gaming into the space,” the company announced in a press release. “The platform transforms everyday exercise activities like walking the dog or daily jogging in the park into social activities or competitions with friends and strangers that encourage consumers to earn money by working out. towards economic freedom.

In addition to attracting new users, the new partnership with Bolt – who has been named Step App’s “lead ambassador” – is partly intended to attract the attention of potential brand partners (including government organizations) “who share Step App’s vision for a healthier world through web3 The company today launched its private beta testing for its gamified and mobile web3 platform.

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