Hong Kong-based Animoca Brands, a developer of blockchain gaming technology, reportedly cut its target for its metaverse fund by a further 20%, to $800 million, Reuters reports, citing sources familiar with the matter.
The blockchain gaming technology company reportedly lowered its $1 billion target due to volatility in the cryptocurrency sector. The company had previously announced in November 2022 that it was working on a new Animoca Capital fund with a target of $2 billion, but then halved that target to $1 billion in January 2023.
In recent developments, people familiar with the matter shared that the company had once again lowered its target by another 20% to $800 million. Reuters said their sources preferred not to be cited because they were not authorized to speak to the media.
Two sources reportedly revealed to Reuters that Animoca’s market capitalization, which was previously valued at about $6 billion following a Temasek-led funding round in July 2022, has fallen below $2 billion, and its shares trade at a considerably lower valuation on secondary markets.
The lowering of the fundraising target and the declining valuation signal a change in sentiment about the cryptocurrency industry, as enthusiasm around these technologies has waned following scandals ranging from from the collapse of FTX to the bankruptcy of several cryptocurrency lenders.
In 2022, the Animoca brand was named the most funded metaverse developer, according to a Nasdaq report. The study revealed that Animoca had the most metaverse deals in 2022, closing 15 deals and receiving more than $564 million in funding.
Animoca, as a prominent player in the metaverse industry, owns a majority stake in one of the leading metaverse platforms called The Sandbox. Apart from this investment, the company has been actively involved in the development of non-fungible tokens (NFTs) and GameFi. According to Yat Siu, one of the co-founders of Animoca, GameFi is expected to become one of the main gateways to the metaverse for the general public.
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