Venture capital firm and Web3 game developer Animoca Brands has refuted claims that its metaverse fund target was cut by $200 million, or 20%, to $800 million amid turmoil in the cryptocurrency market and instability in the banking sector.
The company also played down claims that its valuation had plummeted from $6 billion in July 2022 to about $2 billion in March 2023.
Animoca reportedly halved its $2 billion metaverse fund target initially in January and recently slashed it by 20 percent to $800 million, according to a March 24 Reuters report citing anonymous “people familiar with the matter.” Announced in November 2022, the fund will allocate capital to metaverse-focused mid-stage startups. At the time, Animoca co-founder and chairman Yat Siu outlined a fund target of between $1 billion and $2 billion, depending on the amount of money raised.
In a public statement shared with Cointelegraph, Animoca stated that “the statement that the Animoca Capital fund target was ‘cut’ from $2 billion to $1 billion is incorrect, as $1 billion has been within the announced range.”
The firm did acknowledge that the collapse of the U.S. banking sector certainly had an impact, but stressed that the amount of money the fund will ultimately raise has yet to be determined.
“There is no doubt that FTX and the banking crisis have had a severe impact on the available venture capital, but the fundraising for the Animoca Capital fund is ongoing. We will update the market with appropriate details, including the final size of the fund, once the financing closes, ’ the company said. Commenting on the leaked information, Siu told Cointelegraph that, given that the information comes from unnamed sources, “it makes it very difficult to determine who or what the source and agenda are, which is unfortunate.”
Regarding the company's valuation, Animoca asserted that figures reported by Reuters and "two other" unnamed sources were inaccurate. Animoca, which trades under the symbol AB1, was originally listed on the Australian Securities Exchange (ASX) in the company's early days. However, AB1 was delisted back in March 2020 following ASX’s assertion that Animoca’s involvement in crypto-related activities, among other things, breached its listing rules.
Since then, its shares have been traded on unlisted equity-focused exchanges such as Sydney-based PrimaryMarkets. Data from the platform was used to calculate AB1's total market cap of approximately $2 billion. However, Animoca believes that these figures do not fully represent the company's total valuation.
"The statement that Animoca Brands 'now trades its shares on PrimaryMarkets' is technically incorrect. We terminated our arrangement with PrimaryMarkets in the second half of 2020, however PrimaryMarkets chose to continue trading Animoca Brands shares on its platform, ’ the company said, adding: "We believe that the light trading activity on PrimaryMarkets does not accurately reflect the value of the company. Trading volumes are too low to provide the price accuracy you would find on the actual primary market."
