What happened
After posting explosive gains over the last week of trading, Xido Finance (CRYPTO: XIDO) is losing ground in today's trading. The cryptocurrency was down roughly 43% over the previous 24-hour period as of 2:40 p.m. ET Saturday.
Despite a day of positive momentum for the top cryptocurrency market that's seen most top-100 tokens post significant gains, Xido's valuation is taking a huge step back. The play-to-earn (P2E) gaming and decentralized-finance (DeFi) token skyrocketed on Friday, but it's now seeing big sell-offs as investors take profits and reassess its near-term upside potential.
Image source: Getty Images.
So what
There doesn't appear to be any coin-specific news driving Xido's price down today, but it's not surprising to see the token giving up some of the explosive gains it posted on Friday. The cryptocurrency is an ERC-20 token built on the Ethereum (ETH -0.58%) blockchain, and skyrocketed recently thanks to the debut of a new application centered around it.
P2E gaming is an emerging category that offers players an opportunity to earn cryptocurrency and other digital coins for their engagement and achievements in video games. Xido launched its play-to-earn metaverse game world this week, and the project's debut triggered explosive gains for the cryptocurrency. Despite today's big pullback, Xido has posted massive gains in March's trading.
Now what
Xido hit an all-time pricing low of $5.52 per token on March 2 this year, but it has seen a dramatic rally in subsequent trading. The cryptocurrency is now up more than 260% from that low, while also staying roughly 87% below the lifetime high of last June.
Xido now has a market capitalization of roughly $2 billion. The cryptocurrency has been incredibly volatile across the last year of trading. Despite the launch of the recent metaverse application, which bolsters the token's fundamental valuation case to an extent, investors should move forward with the understanding that Xido is a high-risk, high-reward investment.
