What happened

The whole thesis around the metaverse, along with its growth trajectory in both the stock and crypto markets, has come under intense scrutiny of late. That said, a rally in three metaverse-related cryptocurrency projects today has investors enticed, with this subsector continuing to make significant gains this year after plummeting in 2022. 

As of 11:30 a.m. ET, The Sandbox (SAND -4.79%), Near Protocol (NEAR 1.78%), and Flow (FLOW 0.60%) rose 14.8%, 12%, and 5.3%, respectively, over the past 24 hours. These moves are notable, because the 24-hour move for the overall crypto market is negligible, while equities are seeing significant selling pressure today. 

So what

The Sandbox is among the leading large-cap tokens today, surging on news that the Saudi Arabia Digital Government Authority is expected to partner with it to explore various avenues for growth in the metaverse. Additional interest around The Sandbox's token unlock on Feb. 14 is also driving intrigue around the SAND token.

Near Protocol -- a metaverse-affiliated project, but one that's more known as a leader in web3 technology -- also has some intriguing news of its own. Recent reports suggest that the New York University School of Professional Studies will be partnering with Near Protocol to provide hands-on experience for students to work with web3 tools. Indeed, this is promising news for investors bullish on the ability for the crypto sector to develop talent internally.

And Flow, a blockchain project focused on non-fungible tokens (NFTs) that has strong ties to the metaverse, is also seeing strong bullish momentum this year. As I touched on previously, much of this surge appears to be tied to fundamental factors related to stabilizing transaction volumes, as users start to trickle back into the metaverse and other NFT-related spaces such as gaming.

Now what

These three metaverse-linked projects are certainly among the more speculative in the crypto sector. Accordingly, for most investors who believe that cryptocurrencies are inherently speculative enough, this is a group of tokens that tends to be reserved for the most risk-loving investors in this space.

Of course, the returns in bull market rallies for this group have been incredible. Thus, for traders and speculators playing the recent rally across higher-risk assets, these tokens have come into focus. Of course, should momentum reverse, these are also among the top cryptos that could see significant selling pressure. Thus, I think these three digital currencies closely represent the risk-on trade taking place to start 2023. 

Can this rally continue? We'll see. That said, these are clearly three tokens to keep on the radar for those watching the metaverse right now.